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UK will refuse to pay £39bn divorce bill in no-deal Brexit

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Prime minister Boris Johnson on Sunday said the UK would not pay the £39bn Brexit divorce bill in full in the event of Britain leaving the EU without a deal on October 31.

Ahead of a meeting at the G7 summit in Biarritz with Donald Tusk, president of the European Council, the prime minister said that while the chances of a revised Brexit withdrawal agreement being finalised were “improving”, it was “touch and go” whether a deal could be struck. 

Mr Johnson said that if the UK left without an agreement, it would not be obliged to hand over a significant part of the £39bn divorce bill that it agreed to pay to the EU as part of the withdrawal agreement negotiated by Theresa May, his predecessor.

The new prime minister is seeking to renegotiate the agreement — notably by removing the so-called backstop that is intended to prevent the return to a hard Irish border — although the EU has repeatedly said the accord cannot be reopened.

“If we come out [of the EU] without an agreement it is certainly true that the £39bn is no longer, strictly speaking, owed,” Mr Johnson told ITV. “There will be very substantial sums available to our country to spend on our priorities. It’s not a threat it’s a simple fact.” 

He also said that “very substantial sums” available in the event of a no-deal Brexit could be used to support farmers and “all sorts of areas that are important to our people”. 

Mr Johnson appeared keen to temper expectations about a breakthrough on a revised Brexit deal, while also emphasising the EU was engaging with him.

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He told Sky News there was still an opportunity to strike a deal, noting a “change of mood” among EU leaders.

Mr Johnson has repeatedly said the UK must leave the EU on the designated departure date of October 31, with or without an agreement.

Last week a senior French government official said a no-deal Brexit would not mean the UK could avoid its billions of euros of financial obligations arising from the country’s departure from the bloc.

Britain’s commitment to pay £39bn to the EU as part of Mrs May’s withdrawal agreement was one of the most contentious parts of the Brexit negotiations, particularly for Eurosceptic MPs.

Some of the £39bn arises because the UK has pledged contributions towards the EU budget that have not yet been paid. Britain is also being asked to contribute towards EU staff pension costs that were incurred before Brexit.

Two Sunday newspapers reported that Downing Street was eyeing a general election in mid-October, based on the premise that if the Conservatives won it would give Mr Johnson a mandate to secure a revised Brexit deal with the EU.

But Number 10 insiders said that the public continues to strongly oppose an election and the government will not be seeking one, focusing instead on delivering on the outcome of the 2016 Brexit referendum.

Via Financial Times

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