Fri | Dec 15, 2017

Money the key stumbling block in EU-Britain divorce talks

Published:Friday | September 1, 2017 | 12:00 AM

The European Union and the United Kingdom were locked on Thursday in a bitter fight over the divorce bill London will have to pay on Brexit, a stand-off that fuels concerns over a messy break-up with no deal at all.

The UK is insisting that it has no obligation to meet all the EU's financial demands while the EU says that without clarity on the bottom line, it will refuse to heed UK's demand to quickly open talks on a future relationship which would be vital for a smooth transition once Britain leaves the EU in March 2019.

The two sides remained at loggerheads over a number of issues beyond Britain's financial commitments, including the rights of citizens in each other's areas and the Irish border.

"We did not get any decisive progress on any principal subjects," Michel Barnier, the EU's chief Brexit negotiator, said at a press conference after the conclusion of the third round of separation talks.

After the UK government triggered the two-year separation proceedings in March, the EU said it will not start talking about a future relationship unless key issues like financial commitments are dealt with. These include everything from staff pensions to commitments made to developing countries.

The UK, for its part, says the EU is taking a "maximalist" approach to such issues, but wants to talk about trade as soon as possible as its actual departure date gets nearer.

In testy comments after four days of talks, Barnier said it would only be logical that Britain pays for commitments it made as far back as 2014 and not leave the remaining 27 EU nations footing the bill.

"It would not be fair," he said. "After this week, it is clear the UK does not feel legally obliged to honour its obligations after departure."

According to some estimates, the UK's bill to cover commitments it has made could be around €60 billion (US$71 billion). Many in the UK government have balked at anything that high. Other estimates are even higher.

"We have a duty to our taxpayers to interrogate it rigorously," UK chief Brexit negotiator David Davis said, highlighting a gap of billions of euros separating the two.

Barnier said the dispute posed fundamental questions. "With such uncertainty, how can we build trust and start discussing a future relationship".

In light of the minimal progress made, Barnier said he was not yet in a position to advise EU leaders meeting in October to throw open the talks to include future relations between them.

Barnier said "we are far from seeing sufficient progress." The notion of 'sufficient progress' can only be officially decided by EU leaders, without UK Prime Minister Theresa May.

As well as the divorce bill, the EU wants to see progress on guarantees for citizens' rights and issues related to the border between Northern Ireland and Ireland before any trade talks can begin.

While conceding some of the discussions on Ireland had proven "fruitful," Barnier warned the UK that with "every passing day, we move closer to the date of departure".

Davis conceded that "significant differences" remain and called on the EU to show "flexibility" to break the logjam in talks. Barnier said the EU was ready to intensify the pace of the negotiations.

- AP