How much is our Brexit bill?

Downing Street has been thrown on the defensive over what Britain does or does not owe the European Union.

Dr Matthew Partridge
By
published
in Features

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John Redwood: Britain has nothing to pay
(Image credit: 2016 Getty Images)

Downing Street has dismissed a report that the UK is prepared to pay a €40bn bill to leave the European Union, says Bloomberg.com, while leading Brexit supporters protested at paying anything at all. John Redwood has stated that "there is absolutely no legal need or political need to offer them anything at all, full stop".

The next round of talks with the EU is scheduled for later this month. The problem, says David Allen Green on FT.com, is that the UK "lost the crucial argument on sequencing". Brussels has made a post-Brexit trade agreement with the EU conditional on adequate progress on other issues: EU citizens' rights, the Irish border, and the Brexit bill.

It's hard to see negotiations on our future trading relationship being concluded before March 2019 if we don't pay up, agrees Tom Harris in The Daily Telegraph. And the mooted figure of €40bn "is substantially lower than the €100bn figure being thrown around with abandon a few weeks ago". Bear in mind that "the only way to make good on Leavers' predictions of economic prosperity outside the EU is to make sure that that free-trade deal is done".

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If it isn't, we will end up trading on WTO rules and the trade barriers to Europe would result in a "hefty bill". So it's surely better to pay some money for a few years than "pay... forever via tariffs". Especially if it's just three years' of our annual current fee. Opponents of this "modest... concession" are "displaying all the judgment and sense that landed their party in opposition for 13 years."

Dr Matthew Partridge
Dr Matthew Partridge
Shares editor, MoneyWeek

Matthew graduated from the University of Durham in 2004; he then gained an MSc, followed by a PhD at the London School of Economics.

He has previously written for a wide range of publications, including the Guardian and the Economist, and also helped to run a newsletter on terrorism. He has spent time at Lehman Brothers, Citigroup and the consultancy Lombard Street Research.

Matthew is the author of Superinvestors: Lessons from the greatest investors in history, published by Harriman House, which has been translated into several languages. His second book, Investing Explained: The Accessible Guide to Building an Investment Portfolio, is published by Kogan Page.

As senior writer, he writes the shares and politics & economics pages, as well as weekly Blowing It and Great Frauds in History columns He also writes a fortnightly reviews page and trading tips, as well as regular cover stories and multi-page investment focus features.

Follow Matthew on Twitter: @DrMatthewPartri

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