LONDON: The EU cannot enforce a penny of a possible €60bn divorce bill if Britain crashes out of the bloc without an agreement, according to a report by a Lords committee.High quality global journalism requires investment. The report published on Saturday admits there are “competing interpretations” on the issue of how much if anything the UK will have to produce to leave the EU. The Lords’ European Union committee concedes that generous payments might be “impossible” to avoid, for example to ensure future access to the single market. But it says: “We conclude that if agreement is not reached, all EU law – including provisions concerning ongoing financial contributions . . . will cease to apply and the UK would be subject to no enforceable obligation to make any financial contribution at all.” The UK currently pays about 12 per cent of the EU’s budget, meaning its withdrawal will impose bigger financial burdens on other net contributors such as France and Germany. With the British government expected to trigger Article 50 this month, beginning the process of departure, the divorce bill is expected to prompt the first major row between the two sides.
A heavy bill would enrage some Eurosceptics given that the possibility of an exit charge never featured in last year’s EU referendum campaign. In theory the government could spread some of the payments over many years into the future. But Mrs May’s administration wants a clean break that does not involve any “hire purchase” payments which – in the words of one insider – look like “pseudo or associate member status”. Senior EU figures have suggested repeatedly that any talks on a new free-trade deal will have to wait until the issue is resolved. The tab includes liabilities such as pension pledges, infrastructure spending plans and nuclear decommissioning. So far Downing Street has remained silent on the issue, refusing to say whether or not it will pay the divorce bill and – if so – how much. On Friday Number 10 said the issue was still “hypothetical”.