.comment-link {margin-left:.6em;}

Saturday, April 21, 2018

The divorce bill just got bigger

Are there still people out there who believe that the UK will be better off leaving the European Union? I only ask, because if so then clearly they have not been paying attention. Either that or they are Brexiteers filling some of top Cabinet jobs who feel obliged to defend the many lies that were told during the referendum.

The latest blow to the 'better-off' myth comes in the Guardian, which reports that the cost of the Brexit divorce bill for the UK could be billions higher than the £35bn-£39bn figure put forward by Theresa May.

They refer to a National Audit Office (NAO) report which has warned that the UK could pay an extra £3bn more in budget contributions as well as an additional £2.9bn to the European Development Fund. Auditors have concluded that the Treasury’s estimate includes £7.2bn of receipts which will go directly to the private sector and not to the government’s accounts:

May told parliament in December that the bill would be between £35bn and £39bn, a fee jointly agreed in a meeting between the Treasury and the EU’s chief Brexit negotiator, Michel Barnier.

Auditors found that the total amount that the UK would contribute to the EU annual budgets in 2019 and 2020 would be calculated on the basis of the UK’s economic outlook, which would also partly determine Britain’s share of outstanding commitments and liabilities after 2020.

Britain’s exit settlement could not be defined until there was more certainty in areas such as the economy’s performance in 2019 and 2020, auditors said.

Costs still to be worked out include those relating to pension liabilities, the amount British organisations will receive in EU funding after withdrawal and exchange rate fluctuations because the divorce bill will be paid in euros, according to the study.

“Relatively small changes to some assumptions about future events could push the cost outside of HM Treasury’s £35bn to £39bn range,” the report says.

Due to EU financial rules, the UK could have to pay up to £3bn more in budget contributions than Treasury estimates after formal withdrawal in March 2019. The UK might have to pay towards other costs, which are not in the government estimates, such as potential liabilities that could depend on future events.

The UK will also pay £2.9bn to the European Development Fund for overseas aid, which is not featured in the exit settlement estimate because the fund was not established under EU treaties.

Britain’s contribution to the EU pension scheme might last until 2064 unless the government decides to pay off its commitments earlier in a lump sum, which would present “risks and opportunities to the total value the UK may be liable to pay”.

I didn't see any of that on the side of a bus in June 2016.
Comments: Post a Comment

<< Home

This page is powered by Blogger. Isn't yours?