UK not 'legally obliged' to pay EU exit bill, peers say

Posted On: 
4th March 2017

The UK could leave the European Union without paying a penny, government lawyers and the House of Lords have said.

The Lords committee said the exit bill would be a "prominent factor" in negotiating the UK's future relationship with the EU
PA Images

Legal advice given to the Government states there is no law or treaty compelling Britain to make payments to Brussels after it leaves the EU, The Times reports.

The position is backed by the House of Lords, which said today that the Government had no legal obligation to pay the €60bn Brexit bill suggested by Brussels chief negotiator Michel Barnier, or honour the £12.4bn payments into the EU budget in 2019 and 2020 agreed by former Prime Minister David Cameron.

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However, Britain may have to pay the EU to achieve a strong negotiating position about its post-Brexit position in Europe, the House of Lords EU financial affairs sub-committee said.

“Even though we consider that the UK will not be legally obliged to pay into the EU budget after Brexit, the issue will be a prominent factor in withdrawal negotiations,” said Baroness Falkner of Margravine, the Liberal Democrat peer who chairs the sub-committee.

“The Government will have to set the financial and political costs of making such payments against potential gains from other elements of the negotiations.”

One government source told The Times: “Think of it like golf club rules. Once you leave the club, there is no obligation to keep paying.”

The legal advice and the House of Lords report are likely to prove controversial in Brussels.

Ingeborg Grässle, chair of the European Parliament’s budget control committee, labelled the report’s conclusions “really disappointing”. “It is not about the money. It is about responsibilities. The question is, do you stick to your engagements?” she told the Guardian.

“The EU feels that we have to organise a real divorce and we have to sort out the money, the kids, who gets the dog and the cat… and for the British, it is as if they are leaving a golf club.”

The €60bn Brexit bill suggested by Mr Barnier covers the UK’s share of EU civil staff pensions, unpaid bills and decommissioning nuclear power plants.

A European Commission spokesperson said: “During the time of its membership, the UK has taken – and will take – financial commitments. They should be honoured in full. This will be an essential element of the negotiations on the orderly separation.”