Britain could be forced to pay up to €60 billion (£52 billion) in unpaid budget commitments, pension liabilities, loan guarantees and spending on UK-based projects as part of Brexit negotiations, the Financial Times reports.
The FT was briefed by senior EU negotiators on plans for talks with Britain once Article 50 is triggered, beginning the official process of Britain leaving the 28-nation bloc.
It looks pretty bad for Britain. Michel Barnier, one of the European Commission’s chief Brexit negotiators, wants to go after Britain on finances, forcing it to plug the financial gap created by Britain leaving the EU. The total bill is estimated to be between €40 billion (£34 billion) and €60 billion (£52 billion).
European negotiators say they are also unwilling to discuss transition arrangement or trade deals until a divorce settlement is reached, by mid-2018 at the latest. If Article 50 is triggered early next year, as Theresa May has signalled, this would leave Britain with just 6 months to negotiate a transition and trade deal.
A transition deal, which financial firms based in London are lobbying heavily for, could also involve Britain continuing to pay full EU budget contributions for a number of years. This would lessen the immediate sting of a bill up €60 billion, with payments spread over a few years, but would anger many who voted for Brexit.
The only suggestion that the UK may catch a break is a quote from an unnamed “high-level participant” in the talks, who told the FT: “This is all very dangerous.” This suggests that at least some people in the EU corner are in favour of watering down negotiating demands in a bid to reach an amicable Brexit.
The FT report suggests a relatively clear negotiating position from the EU. It comes on the same day as a leaked memo suggests that the government’s Brexit plan is in chaos. The memo says that divisions within the cabinet have led to over 500 different plans developed across different government departments. It says Whitehall may have to hire as many as 30,000 extra civil servants to deal with the project.