Not too high: Foreign Secretary Boris Johnson has said the EU can ‘go whistle’ if it made ‘extortionate’ payment demands of Britain. Picture: REUTERS
Not too high: Foreign Secretary Boris Johnson has said the EU can ‘go whistle’ if it made ‘extortionate’ payment demands of Britain. Picture: REUTERS

London — Britain is prepared to pay up to €40bn as part of a deal to leave the EU, the Sunday Telegraph newspaper reported, citing three unnamed sources familiar with UK negotiating strategy.

The EU has floated a figure of €60bn and wants significant progress on settling Britain’s liabilities before talks start on issues such as future trading arrangements.

The government department responsible for Brexit talks declined to comment on the article. So far, Britain has given no official indication of how much it would be willing to pay.

The newspaper said British officials were likely to offer to pay €10bn a year for three years after leaving the EU in March 2019, then finalise the total alongside detailed trade talks.

Payments would only be made as part of a deal that included a trade agreement, the newspaper added.

"We know [the EU’s] position is €60bn, but the actual bottom line is €50bn. Ours is closer to €30bn but the actual landing zone is €40bn, even if the public and politicians are not all there yet," the paper quoted one "senior Whitehall source" as saying.

Whitehall is the London district where most British government departments and ministers are based.

A second Whitehall source said Britain’s bottom line was "€30bn to €40bn" and a third source said Prime Minister Theresa May was willing to pay "north of €30bn", the Sunday Telegraph reported.

Britain’s Brexit minister David Davis said on July 20 that Britain would honour its obligations to the EU but declined to confirm that Brexit would require net payments.

British Foreign Secretary Boris Johnson, a leading Brexit advocate, said last month the EU could "go whistle" if it made "extortionate" demands for payment from Britain.

Pro-Brexit campaign group Leave Means Leave said speculation about a divorce bill from the EU was "unhelpful".

"With the EU Brexit negotiations, nothing is agreed until everything is agreed," said the groups’ co-chair Richard Tice.

"The focus should be on accelerating talks with the aim of concluding them at the end of 2017. This would enable businesses to adapt during the 15 months leading to March 2019."

The Telegraph said advisers in May’s office had warned bosses in London’s financial sector that Britain walking out of Brexit talks was a "real possibility" if the impasse over the bill could not be broken.

Former European Commission head Romano Prodi told the Observer newspaper it would be economic "suicide" for Britain to fail to reach a compromise on Brexit, and called on the EU to preserve as much trade with Britain as possible to avoid damaging both sides.

If Britain cannot conclude a deal, trade relations would be governed by World Trade Organisation rules, which would allow either party to impose tariffs and customs checks and leave many issues unsettled. The EU also wants agreement by October on rights of EU citizens already in the UK.

Reuters

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