May ‘set to raise Brexit divorce bill to £40bn’
Ministers are preparing to offer the eU up to £40billion in divorce payments, Philip Hammond has suggested – as ministers prepare for a crunch meeting on the issue today.
the chancellor said the Government would make a fresh offer to Brussels ahead of an eU summit next month when leaders are due to decide whether to begin post-Brexit trade talks with the UK.
Mr Hammond put no figure on the new offer, but Brussels sources have suggested the eU will not consider a payment of less than £40billion.
this is double the figure previously offered by theresa May.
in september, the Prime Minister offered to hand over £20billion to the eU during a two-year transition to a new relationship after Brexit in 2019.
But eU leaders, who are demanding at least £53billion, have rejected the offer as too small. Ministers on a key cabinet sub- committee are due to hold talks behind closed doors today on how much to offer the eU, and what to demand in return.
Boris Johnson and David Davis have both warned the Prime Minister against making a significant new offer unless it is accompanied by guarantees on the type of trade deal the UK can expect from Brussels.
But the chancellor yesterday indicated he was backing a bigger payment, saying there was a ‘very high value’ in having a close trade relationship with the eU after Brexit.
talking up the prospect of a new offer, he told the BBc’s Andrew Marr show: ‘ i do think we’re at something of a turning point. We’ve had a difficult year.
‘We’re now i think on the brink of making some serious movement forward in our negotiations with the european Union, and starting to unlock that logjam so that people can start to see clarity about the future.’
the eU’s chief negotiator, Michel Barnier, set a deadline of this Friday for a new offer, although this has now been extended for a further week. France and Germany, which will have to plug the financial holes left by the UK’s eU departure, have both indicated they will delay the opening of trade talks until they receive an improved offer.
Ministers are desperate to begin talks on trade and a twoyear transition deal at next month’s eU summit in Brussels. Mr Hammond yesterday suggested ministers would act to ensure a deal, saying: ‘ We will make our proposals to the eU in time for the council, i am sure about that.’
the cabinet’s Brexit strategy and negotiations subcommittee is due to meet today to try to thrash out an agreement on a new offer.
this could be put to a full meeting of the cabinet tomorrow before being proposed to eU council president Donald tusk, who will travel to lonmembers
‘Clarity about the future’
don for emergency talks with the Prime Minister on Friday.
But, despite Mr Hammond’s assessment, there is no guarantee of agreement among ministers. One cabinet source said there was ‘impasse’ on the issue. Pro-remain ministers have a narrow majority on the Brexit sub-committee.
But the Prime Minister is said to be reluctant to push ahead without the support of Brexiteers such as Mr Johnson, Mr Davis, Michael Gove and liam Fox, who are all of the committee. Mrs May will come under pressure today to get guarantees from Brussels on the future relationship with the eU before agreeing a new sum.
Failure to get agreement on the divorce terms next month will lead to renewed calls for the Government to prepare for leaving the eU without a trade deal. eurosceptic Jacob rees-Mogg yesterday urged ministers to reject any further financial demands.
He said: ‘it’s a matter of choice for the Government – they will have to choose whether to give lots of money to the eU or spend money on necessary UK public services. i’d encourage the Government to choose our own domestic services, instead of expensive schemes in europe.’
And some pro-remain MPs are also nervous about handing over large sums to Brussels without receiving guarantees in return. tory MP stephen Hammond said he was not opposed to increasing the offer, but added: ‘We have to be clear what we’re paying for and what we’re getting.’