Phillip Hammond under pressure to cut the UK’s divorce bill
March 21, 2017

Phillip Hammond, Chancellor of the Exchequer, is facing calls from pro-Brexit cabinet ministers to cap Britain’s EU divorce bill to £3 billion, after indicating this week that the country would meet its EU debt obligations – “[Britain is] a nation that honours its obligations, and if we do have any bills that fall to be paid we’ll obviously deal with them in the proper way”. It is understood that the EU is preparing to demand up to £50 billion from Britain once the Prime Minister, Theresa May, triggers Article 50 next Wednesday, 29 March. The amount of Britain’s liabilities is expected to be the first issue that will be discussed once Brexit negotiations formally begin. Senior Conservative ministers have said that the UK is not obliged under EU or International law to pay the amount sought by the European Council – “as the Prime Minister said, we do not want to pay huge sums. We think anything over £2 billion or £3 billion is not possible. There are those round the Cabinet table who think we are going to have to pay a huge amount to get out, and the Chancellor is on that side.” However, sources close to Mr. Hammond responded that the Chancellor has not announced that the UK will pay £50 billion, having told EU officials of overstating their position at the G20 summit last weekend. Britain wants to discuss the divorce and future trading relations at the same time but the EU has toughened its negotiating stance, saying that the UK’s payments must take priority. The Treasury will assess whether any liabilities demanded by the EU must be met, with David Gauke, Chief Secretary to the Treasury, overseeing the analysis.

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