Brexit chief dismisses 40B-pound exit bill claim as PM lays out negotiating plans

Published 24.09.2017 21:32

Brexit negotiator David Davis on Sunday dismissed a report that Britain was prepared to pay 40 billion pound ($54 billion, 45 billion euros) divorce bill on leaving the European Union.

The Times quoted a "Brussels source" in their story on Saturday, but Davis told BBC television that "they sort of made that up."

"I'm not going to do an actual number on air, it would be ridiculous to do that, but we have a fairly clear idea where we're going on this," he said.

He called EU claims for Britain to contribute to the bloc's future pension pot as "debatable to say the least."

"The last time we went through line by line and challenged quite a lot of the legal basis of these things and we'll continue to do that."

British Prime Minister Theresa May on Friday revealed plans for a transition period of around two years after it officially leaves in 2019, during which time Britain would still largely be under current EU rules.

Davis stressed that Britain "would not under any circumstances" accept the supremacy of the European Court of Justice after the transition period, a key issue for Brexit hardliners. He added that it was "quite likely" that a joint system of EU-UK courts will be agreed in order to resolve disputes.

May's cabinet is divided over certain key issues of Brexit, particularly on what terms Britain wishes to access the EU's single market after it has left.

The pro-EU faction of her government, led by finance minister Philip Hammond, want close ties with the bloc, while Brexit campaigner and foreign minister Boris Johnson is pushing for a cleaner break.

Johnson heightened tensions last week with a newspaper article spelling out his vision, and wrote again in the latest edition of the Sunday Telegraph to lay down his demands. He said Britain should not adopt any new EU rules made during the transition period and wants London to be able to sign trade deals with countries outside the EU during the two-year period.

Davis denied Johnson's article had changed the content of May's speech, saying the "policy in the prime minister's speech had been coming for a long time.

"I don't think there's been any change of policy in the last few weeks."

May's Florence speech was intended to jolt the divorce talks out of deadlock, three months after they began and to demonstrate some unity in her government - notably on remaining in the EU single market and accepting its rules for a couple of years after Brexit, a bitter pill for some hardline opponents of EU membership.

The tone went down well with some: "There are many positive elements, especially regarding the future relations," a senior EU government official said. "On the other hand, on issues related with the separation there is not much clarity. We are looking forward to receiving detailed proposals."

May made two potentially important concessions on the other two criteria for moving on to trade talks: a direct role for the EU-UK exit treaty and for EU case law in British judges' rulings on the future rights of EU citizens in Britain; and she said Brexit would not immediately cost other states money.

On the first, Barnier may repeat the EU demand for direct oversight by European Court of Justice; on the second, EU negotiators insist Britain will owe a share of Union spending for years after the budget May referred to, which ends in 2020.

One potential benefit from a transition period may be that it lets Britain present its voters with a somewhat less hefty bill for leaving than the 60 billion euros ($70 billion) or so that Brussels reckons it would owe the EU come March 2019.

About a third of that 60 billion represents what the EU wants Britain to pay into the current budget for 2019 and 2020, whether or not it remains in the single market. By staying in for a transition period, Britain could deduct that 20 billion euro payment from the one-off, pre-Brexit divorce settlement.

Such payments to the EU have become a hot-button issue for British voters, somewhat to the frustration of EU negotiators who note that Britain's annual net contribution to the EU budget represents little more than 1 percent of its public spending.

May will meet Donald Tusk, who chairs EU summits, over lunch in London on Tuesday and then the 27 leaders at dinner in Estonia on Thursday, just after Barnier and Davis are expected to have concluded the negotiating round in Brussels.

The Eurocrats insist they will not negotiate with May over Barnier's head, but this week could be an important moment in setting how quickly they are willing to open trade talks for the future - and indeed in determining how far mutual tactics of bluff and counter-bluff may risk ending in chaos without a deal.

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