£36billion

UK Brexit ‘divorce bill offer’ enrages Tory Eurosceptics who warn they will block it

HARD line Tory Eurosceptics last night warned ministers they would try to block a Brexit ‘divorce bill’ of £36billion.

MPs lined up to criticise the offer, calling it ‘illogical’, ‘absurd’ and even ‘illegal’.

Downing Street dismissed a report that the Government was considering paying such an amount.

A source called it ‘wrong’ and ‘inaccurate speculation’ – and indicated internal estimates of the likely payment were much lower.

But the figure is among those being discussed in Whitehall as part of attempts to kickstart progress in EU exit talks.

The Sunday Telegraph reported that the Government will only agree to pay the sum if the EU treats it as part of a deal on future relations. It said the EU wanted £54billion but would accept nine billion less.

The UK would offer £27billion but could stretch to £36billion, it claimed – with the Government making net payments to the EU of around £10billion a year for up to three years after Brexit. The EU is insisting that trade talks cannot start until ‘significant progress’ has been made on the financial settlement, citizens’ rights and the question of the border in Northern Ireland.

Any payment would be conditional on a full deal on a future relationship, including a full trade agreement.

No agreement has been reached within the Cabinet – including among senior figures in the Leave campaign such as Boris Johnson, Liam Fox and Michael Gove.

At £36billion it would fall far short of some of the numbers suggested by senior Brussels officials, who have demanded the UK pay up to 100billion euros – or £90billion. Theresa May has insisted that the days of ‘vast annual payments’ to the EU will end.

But ministers, including those who voted to leave, accept privately that some payment will be made when we do – to cover programmes already agreed to by the UK, and liabili-

‘It would be totally bizarre’

ties such as pension payments for EU officials. Last night, archEurosceptic MP John Redwood called the figure ‘a nonsense’.

He said: ‘It’s a bad idea to pay anything to get talks about trade, which they have to talk about at some point anyway. Ministers would have to pass an Act of Parliament to authorise an otherwise illegal payment.

‘I have told ministers, they have no power to make an exgratia payment to the EU. I would say the chances of it going through Parliament were pretty slim, because even some Labour MPs would see it was a choice between giving the EU £36billion and spending more money on health, education and welfare.’ Conservative MP Peter Bone said a Brexit fee of that magnitude was unlikely to get through Parliament.

He said: ‘One of the prime reasons the UK voted to leave the EU was to stop sending them billions of pounds per year, so it would be totally bizarre to give the EU any money, let alone £36billion, given also that over the years we have been in the EU or its predecessor we have given them over £200billion. So if there was going to be any transfer of money then it should be from the EU to the UK.’

Jacob Rees- Mogg, MP for North East Somerset, said the figure was ‘absurd’.

‘There is no logic to this figure, legally we owe nothing,’ he said. ‘We ought only to pay in for schemes that we wish to remain involved with.’

Conservative MEP David Campbell Bannerman noted that the figure was ‘close to’ the £38billion for two years of UK contributions to the existing EU Budget, which has been agreed to the end of 2020.

If Britain leaves without paying anything, the EU will have to find money from its remaining members to cover the UK, the second largest contributor to the EU budget.

Manufacturing is on the rise and will help steer the UK back to growth, a report has claimed. Output among manufacturers is booming, with more businesses expecting healthy order books in the coming months, said accountants BDO. The business advisors’ output index rose to 95.1 last month from 94.9 in June – climbing into growth territory after last month’s contraction. The growth was driven by the improving performance of the manufacturing sector.