UK may quit talks with EU over size of Brexit bill

Britain's Secretary of State for leaving the EU David Davis.
Britain's Secretary of State for leaving the EU David Davis. PHOTO: REUTERS

Britain wants the bloc to drop demands for a divorce payment as high as $155 billion

LONDON • Britain will quit talks on leaving the European Union (EU) unless the bloc drops its demands for a divorce payment as high as €100 billion (S$155 billion), the United Kingdom's Brexit Secretary David Davis has said.

Britain's negotiations would otherwise be plunged into "chaos" and even a £1 billion (S$1.8 billion) settlement would be "a lot of money", Mr Davis said in an interview published in London's Sunday Times.

The size of Britain's exit bill, and which types of negotiations can begin before it has been agreed, has been a source of debate for weeks.

European Commission President Jean-Claude Juncker has said the UK will have to pay about £50 billion, while Luxembourg Prime Minister Xavier Bettel has signalled a figure between €40 billion and €60 billion.

The Financial Times estimated the cost could balloon to €100 billion, while a study by the Institute of Chartered Accountants in England and Wales put the cost at as low as £5 billion.

Prime Minister Theresa May's government has questioned how Brussels officials reached their preliminary estimates.

Mrs May also weighed in on the Brexit bill, saying in an interview with the London Sunday Telegraph that "money paid in the past" by the UK into joint EU projects and the European Investment Bank ought to be taken account in the final sum.

"There is much debate about what the UK's obligations might be or indeed what our rights might be," she said. "We make it clear that we would look at those, both rights and obligations."

Meanwhile EU ministers yesterday unanimously gave Frenchman Michel Barnier the green light to start what they warned would be "very difficult" talks with Britain over its exit from the bloc.

Negotiations are expected to begin in mid-June, after the British general election.

A former European commissioner and French foreign minister, Mr Barnier will conduct negotiations on behalf of the remaining 27 EU member states for the coming two years, based on a set of "negotiating directives" .

The EU insists on making "sufficient progress" on three key divorce issues before talks can start on a future UK-EU trade deal. These are the rights of EU citizens in Britain and British citizens on the continent; London's exit bill; and arrangements for the border between Ireland and the British province of Northern Ireland.

Britain, however, wants the divorce settlement and the future trade relationship to be discussed in parallel. "We all have to prepare for very difficult negotiations,"German foreign ministry state secretary Michael Roth said.

BLOOMBERG, AGENCE FRANCE-PRESSE

A version of this article appeared in the print edition of The Straits Times on May 23, 2017, with the headline 'UK may quit talks with EU over size of Brexit bill'. Print Edition | Subscribe