The UK has told EU negotiators their sums on the Brexit bill do not add up, as talks on Britain’s separation from the bloc hit deadlock.
Tensions boiled over in Brussels as the EU accused Britain of failing to reveal its hand on the financial settlement. UK officials hit back at the EU, saying some claims for money had no legal basis.
Michel Barnier, the EU’s chief negotiator, vented his frustration amid slow progress during the third round of talks, which conclude on Thursday. “To be flexible you need two points – our point and their point,” Barnier told reporters. “We need to know their position and then I can be flexible.”
Meanwhile, British negotiators fumed at suggestions they were not serious – a charge levelled by Barnier on Monday because the UK has not published a paper on the Brexit financial settlement.
Over a three-hour Powerpoint presentation, British officials picked apart the EU claims over liabilities, which are reputed to be about €75bn, although Barnier has never cited a figure.
Numbers were not on the table during the latest talks. Instead the two sides are trying to hammer out liabilities the UK could face – a politically sensitive task that will shed light on the final bill and is bound to incite charges of betrayal from hardline Brexiters.
David Davis, the Brexit secretary, has acknowledged the UK has “obligations” from its 44 years of EU membership, but is refusing to say what they are.
The British team thinks the EU is trying to extract more than it is legally entitled to, on the basis of an “unsatisfactory” paper that runs to less than four sides of text and some tables.
“The UK has made it clear that it finds the EU position paper on the money unsatisfactory and nobody would sign a cheque on the basis of the commission’s paper,” said a source familiar with the UK’s position. “It is also clear that they have an issue with the current view around town that ‘serious’ means agreeing with the commission. The UK doesn’t agree with it.”
In particular, Britain is challenging the claim it should pay into the EU budget until the end of 2020. The EU has said the seven-year budget was agreed by David Cameron in 2013, while the UK counters there is no legal basis for the payments, and too many extras have been thrown in.
Barnier has described as “incontestable” British liabilities, which include pensions, unpaid bills and the pending budget contributions. He has described the EU methodology as “rigorous and objective”.
The stakes are high because the UK is barred from discussing its future with Europe until there is “sufficient progress” on the financial settlement, citizens’ rights and Ireland – a judgement that will be made by EU leaders.
Throughout the negotiations, the UK has railed against this “inflexible” timetable, but the Brexit secretary’s calls to merge talks have been rejected.
Barnier’s hands are tied, because his brief has been agreed by the EU’s 27 leaders, who have no wish to rewrite the mandate. While the UK hoped to pass the “sufficient progress” test in October, EU diplomats say they are not concerned about delays until the end of the year.
As tempers frayed, Guy Verhofstadt, the European parliament’s Brexit coordinator, said hopes of a divorce deal in October looked doubtful. “If it goes very slow, as is the case at the moment, it will be very difficult to say there is sufficient progress when we are in October,” he said.
He added: “If only one party around the table is putting a position and the other party is not responding then it is difficult to start a negotiation.”
The UK has more than 100 officials involved in the ongoing talks, which also cover citizens’ rights and Ireland.
Progress has been heavy-going on citizens’ rights, with little hope of progress on the 50% of areas under dispute. The European health insurance card has proved to be a sticking point, meaning 27 million Britons could still lose the right to claim free or low-cost healthcare when visiting the continent.
Even some of the less significant “other” issues are also proving harder to negotiate than some expected. The two sides are far apart on what happens to goods on the move on Brexit day. Although this issue could disappear with a transition deal, failure to reach any deal could lead to long queues at ports, as companies fall into a legal black hole.
While the mood is intense, it is also understood to be respectful. There are seasoned negotiators on both sides, many of whom know each other from routine Brussels meetings.
Verhofstadt said he saw signs of change in the UK, such as greater recognition that no deal is the worst possible outcome. He also said there was new understanding of the need for a transition period, which he predicted would replicate the status quo.
“The more and more time we lose in the coming months, the more and more it is clear that the transition period can only be the prolongation of the existing situation, of the status quo,” Verhofstadt said.
This view – firmly in the Brussels consensus – flies in the face of government hopes to secure brand new customs arrangements by Brexit day in 2019.