Britain and EU agree on Brexit bill

Negotiators from both sides confirm they have reached an in-principle deal on size of payment

BRITISH and EU negotiators have reached a deal on the Brexit bill, opening the door to a potential breakthrough in talks next month, The Daily

Telegraph has learnt.

Sources on both sides said that an agreement-in-principle had been reached over the EU’S demand for a €60 billion (£53 billion) settlement ahead of a crucial lunch meeting on Monday between Theresa May and Jean-claude Juncker, the European Commission president.

Two senior inside figures confirmed that terms were agreed at a meeting in Brussels last week after intense backchannel discussions led by Oliver Robbins, the UK’S chief Brexit negotiator.

The Telegraph understands that the final figure, which is deliberately being left open to interpretation, will be between €45billion and €55billion, depending on how each side calculates the output from an agreed methodology.

It means that the final amount will be far higher than the initial opening €20billion offer to win “sufficient progress” made by Mrs May in her Florence speech.

The gross UK settlement, before deductions, is understood to be €100 billion.

After being dragged down earlier in the day by the Bank of England Governor Mark Carney’s gloomy warning of potential Brexit “pain”, sterling spiked above €1.12 against the euro as traders piled into the currency on news of a breakthrough in negotiations.

Although it remains true that “nothing is agreed until everything is agreed”, sources said the breakthrough on money effectively now leaves only two major obstacles in order to make progress when the European Council meets on Dec 14.

These are defining the role of the European Court of Justice (ECJ) in governing the agreement on the rights of 3.2million EU expats in the UK after Brexit, and the continued row between London and Dublin over avoiding a return to a hard border with Northern Ireland.

“The deal on the money is there. It’s now the ECJ question and Northern Ireland that are the outstanding issues ahead of the council,” said a senior source involved in negotiations.

The deal on the bill throws the spotlight on to the ongoing negotiations over the Irish border question.

British and Irish negotiators are in “constant touch” in search of a compromise solution as the December deadlines approach.

In a boost for the process, the threat of a snap Irish general election, which had threatened to create a political vacuum at a crucial moment in the Brexit talks, was ended yesterday by the resignation of Frances Fitzgerald, the Irish deputy prime minister.

The British offer on all three areas – money, citizens’ rights and Northern Ireland – is now expected to be delivered by Mrs May next week in order to enable Michel Barnier, the EU’S chief negotiator, to make his recommendation on “sufficient progress”.

If Mr Barnier gives the green light, a meeting of EU ambassadors is scheduled for next Wednesday to prepare guidelines ahead of the European Council summit a week later, with the European Parliament likely to vote on its own “sufficient progress” resolution on Dec 13.

However, the EU has made clear that the payment is for settling past liabilities and does not guarantee a trade deal.

“This is the easy part,” said one EU

negotiator. “The hard part comes when we talk terms on trade and transition.”

The precise size of the UK’S payment will not be calculated until the point of UK exit, and the Telegraph understands the EU side is discussing how to obscure the final bill in order to help Mrs May overcome political opposition from Brexiteers.

Last night, Nigel Farage said Britain was unwise to commit to a larger bill.

He said: “Even if we were guaranteed a free trade deal in return, I would still be saying ‘it is not worth £45 billion’.”

The UK had already signalled a willingness to pay €40billion, but the Telegraph understands that Mrs May was forced to increase that offer during the course of the last week on the advice of all seven members in the Cabinet’s Brexit sub-committee.

A third EU source with knowledge of the talks said the text of the deal would allow a “low figure” to be generated for the UK public, but that the final text would give the EU certainty it was looking for, which is in excess of €50 billion.