In the 3 years since leaving the EU, the UK has paid Brussels £35 billion

Enough to pay UK pensioners their Winter Fuel Allowance for the next 25 years

Montage © Facts4EU.Org 2024

The news only adds to Sir Keir Starmer’s woes at his party conference this week as his ratings plunge

With millions of UK pensioners in an uproar about losing their Winter Fuel Allowance in order to save money for Rachel Reeves’ upcoming budget, the Facts4EU.Org think-tank reviewed the latest official information released on Friday, about just how much money the UK is still sending to the EU despite having left over three years ago.

Even using the most conservative estimates from government files, the UK has paid the EU over £35bn net in the three years since the UK’s official exit. This includes payments under the ‘Divorce Bill’, as well as more billions for the EU’s ‘off-budget’ payments, and even more billions for fines from the EU Commission.

The funds given to the EU exceed Rachel Reeves’ "£22bn black hole"

With the Labour Government’s first budget fast approaching (on Thurs 31 Oct 2024), there has been much talk in the media of the ‘£22bn black hole’ which Chancellor Rachel Reeves claims to have discovered in the UK’s finances, allegedly bequeathed to her by the previous government of Rishi Sunak and his then Chancellor Jeremy Hunt.

In addition to this there has been a furore over the axing of the Winter Fuel Allowance for pensioners, as well as the revelations of alleged undeclared gifts to Sir Keir Starmer and other members of the Cabinet. Then we learnt last week that the total of UK Government debt has hit 100% of GDP.

Finally on Sunday, the Observer published their latest poll showing Sir Keir’s personal approval rating amongst the public has dropped by 45 points since the general election.

With this Facts4EU report for GB News, the financial news for Mr Starmer gets even worse

Against the financial and political landscape outlined above, the Facts4EU.Org think-tank has studied the latest declarations of government spending released on Friday by the Office for National Statistics,as well as additional official data from HM Treasury, the National Audit Office, and the OBR.

Amongst many troubling facts which our analysis has uncovered, the UK’s ongoing payments to the EU in Brussels stand out.

What’s the cost of Theresa May’s settlement with the EU?

According to the ONS and HM Treasury the settlement demanded by the EU :

“will have a net cost of £30.2 billion to the UK, according to the Treasury’s latest estimate. As of May 2024, net payments of £26.2 billion had been made.”
- Office for National Statistics, July 2024

Brexit Facts4EU.Org Summary

The UK’s continuing payments to the EU

The last 3 years since the end of the ‘Transition Period’ on 31 Dec 2020

Under the ‘Divorce Bill’ and other EU claims, the UK has paid around £35bn to the EU Commission since the UK’s formal exit. This includes payments for items which were never included in the ‘net cost of membership’.

Net payments

Feb 2020 - Dec 2023 : £23.8 bn
Jan - May 2024 : £2.4 bn
Jun 2024 - 2065 : £4.0 bn

'Off-budget' EU funds

EDF 2023 : £2.9 bn
ECHR fine 2022 : £2.3 bn

TOTAL : £35.4 bn

[Source: Latest data - Office for National Statistics | H M Treasury | National Audit Office | Office for Budget Responsibility | EU Commission .]

The ONS went on to confirm that Fact4EU.Org's numerous reports over recent years showing that the UK would still be liable to pay monies to the EU Commission until 2065 are indeed correct.

“An estimated £4 billion of net payments are expected from June 2024 to 2065, which is an average annual net payment of roughly £95 million.”
- Office for National Statistics, July 2024

This is another 40 years of liabilities, and this is in fact one of the smallest amounts for which the UK may be liable to the EU. Based on eight years of research on such matters we strongly believe the amount will be much higher.

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What previous governments signed us up to

The figures shown above are part of what colloquially became known as ‘the Divorce Bill’, first agreed to by the Remain-supporting Prime Minister Theresa May.

There was never any legal obligation on the UK to pay the EU anything on exit. Even the Committee of the Remainer House of Lords in their report at the time confirmed this. Nonetheless the EU Commission, represented by its Chief Brexit Negotiator, (and now French Prime Minister), Michel Barnier erroneously claimed it and Theresa May and Ollie Robbins, her civil servant in charge, agreed.

The Rt Hon Sir John Redwood, former Secretary of State, commented on our report

“Facts4EU.Org’s research for GB News once again reveals a scandalous truth that most of the media ignores.
“The UK has gone on paying huge sums to the EU three years after we finally left. In the last 3 years the UK has foolishly paid the EU more than the Chancellor's alleged black hole and meekly plans to send the EU more. No wonder we are still short of cash to pay pensioners their heating allowance.
“I urged leaving the EU with no deal and trading on WTO ‘Most-Favoured Nation’ terms to spare us this unacceptably large bill. The Treasury should query the invoice and refuse to pay EU fines now we are out.”
- Former Secretary of State the Rt Hon Sir John Redwood, 24 Sept 2024

This ‘Divorce Bill’ has no upper limit

Extraordinarily the final amount the UK will end up paying to the EU is not known. Here is what the House of Commons Library had to say in their last report on 23 July this year.

“There is no definitive cost to the settlement. The final cost to the UK will depend on future events such as future exchange rates and EU budgets.”
- House of Commons Library briefing to MPs, 23 July 2024

Government’s independent auditor: ‘significant risks’ about the total figures payable to the EU

It is an uncomfortable fact that no-one in or close to Government knows the precise figure for the UK’s payments to the EU. The figures published by the ONS, HM Treasury, the OBR, and the EU Commission are all different. In our figures above we have used what we believe to be the best estimate.

Below we quote from the Certificate and Report of the Comptroller and Auditor General to the House of Commons, entitled: "Key audit matter 1 – EU Financial Settlement"

“The Agreement includes a Financial Settlement and sets out the various rights and obligations of the UK and EU during the transition period and beyond. These include financial rights and obligations that fall to HM Treasury. The transition period ended on 31 December 2020. I have identified a significant risk of material misstatement in HM Treasury accounts because of the underlying complexity and sensitivity of judgements surrounding interpretation of the Withdrawal Agreement. I consider this area to be a key audit matter.”

The one thing we do know for sure is that the UK will continuing paying the EU until 2064.

Observations

In what must surely rank as one of the worst international negotiations of all time, the British Government of Theresa May agreed to an open-ended ‘financial settlement’ with the EU Commission of Jean-Claude Juncker, despite no obligations to pay anything whatsoever. The consequences of this can be seen above.

At a time when the new Government is preparing for their first budget (at the end of next month) it seems that every billion pounds is under scrutiny. Already the Winter Fuel Allowance is being scrapped for millions of pensioners, unless they receive Pension Credit or certain other means-tested benefits. 10.8 million pensioners in 7.6 million households in England and Wales received the Winter Fuel Payment for winter 2023/2024.

The Department for Work and Pensions (DWP) estimates that in future only 1.5 million individuals in 1.3 million households in England and Wales will receive a payment for winter 2024/2025. This would mean 9.5 million pensioners no longer receiving the payment they were expecting.

The measure is part of a package announced by the Labour government aimed at making immediate savings following an audit of public spending. It is expected to save around £1.3 billion in 2024/25. The monies listed above which are sent to the EU would have kept the UK's pensioners warm for another 25 years.

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[ Sources: Office for National Statistics | H M Treasury | National Audit Office | Office for Budget Responsibility | EU Commission ] Politicians and journalists can contact us for details, as ever.

Brexit Facts4EU.Org, Tues 24 Sept 2024

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Reader Comments 11

1. John Jones , Tuesday, September 24, 2024, 06:58:

The UK agreed to pay the EU as part of a long and heated Withdrawal Agreement. The order of magnitude costs where pretty much known at the time with some ' indeterminate costs ' called Reste à liquider (RAL) also budgeted for.
ECHR fine 2022 : £2.3 bn
ECHR and the EU are different organisations - the ECHR is a Court based in Strasbourg to which we signed up in c. 1951 before the UK entered the EEC/Common market in 1973.
European Development Fund
The Treasury expects the UK to make £2.9 billion of payments to the EDF, with payments ending in 2026.
As at 31 December 2023, the UK had around
£0.5 billion of outstanding contributions to the EDF.
HoC Report 23/07/24

2. Sparky , Tuesday, September 24, 2024, 07:54:

Resurrecting the "No Deal" scenario which the worst case effects of leaving the EU were based on. These worst case scenarios are the ones often quoted as Brexit must be working because it's not as bad as they said it would be. I expect there will be comments today around it was the EU's fault or Remainers fault. No, this is a result of Brexit.

3. LuxuryBalloon , Tuesday, September 24, 2024, 09:31:

I prefer having our sovereignty back than getting the WFA from the government … a very small price to pay … especially if you compare that to all the projects Fear that the remainers invented.

4. Andy , Tuesday, September 24, 2024, 09:44:

Sparky,
No it is not the result of Brexit. It is the results of the work of people like you. Nowhere in any EU treaty is there any obligation for a none member to contribute one penny to THEIR budget. There is in fact no mechanism within any treaty for this to happen. It was the EU and Barnier who dreamt up this nonsense and that fool May and her poodle who agreed. There was and is no basis for any of it in Law, that is to say the EUs own Treaties. If you think I am wrong quote the relevant articles from the treaties.

5. Gazzablack , Tuesday, September 24, 2024, 13:55:

Meanwhile over at the Labour party conference, Keir Starmer has called for the "return of the sausages" in the Middle East"
.

6. John Jones , Tuesday, September 24, 2024, 17:53:

4. Andy
"..However, the political and economic consequences of the UK leaving the EU without responding to claims under the EU budget are likely to be profound. If the UK wants a preferential trading relationship with EU, including a transitional arrangement, the EU partners may well demand a financial contribution post-Brexit..."
This came from the House of Lords Brexit Committee - real politik by virtue of UK wanting a de minimus deal ( as it turned out) with the resultant TCA - effectively meant that we paid money to the EU to leave in order to get a minimal deal.
Our case wasn't helped because we'd also made 7 year forward commitment to spending alongside other member states in the MFF negotiations.

7. Andy , Wednesday, September 25, 2024, 06:06:

6, JJ. The fact remains that there was no legal basis whatsoever for any payments to the EU after leaving. Whether the UK "made 7 year forward commitment to spending alongside other member states" was irrelevant because the EU should have adjusted its budget in light of its revised income - the EU is a Legal Entity.
The UK should have withdrawn from the EU under its own constitutional terms, that is to say repealed the 1972 Act. Article 50 of the Lisbon Treaty did not oblige the UK to negotiate any treaty with the EU and nor should we have done so. The EU behaved, as it always does, in an arrogant manner and ignored its own Law and accepted international conventions and norms.

8. John Jones , Thursday, September 26, 2024, 13:22:

7. Andy
I struggle to accept this revisionist form of history.
Like it or not ( I don't myself) the UK made a 7 year commitment in the MFF in good faith - we didn't know at the time that there would be a referendum much less that we'd vote to leave.
Multi year obligations are relevant to many organisers & companies - it's not uncommon to have to pay off forward debts.
Again it's unfortunate, whilst I didn't like Article 50 we as in Gordon Brown signed the Lisbon Treaty - this made Article 50 a legally binding clause to leave the EU.
Sure we had no legal obligation to cut a deal having invoked Article 50. Article 50 stacked the eventual Withdrawal Agreement in the EUs favour.
My beef is that Theresa May had no strategy or plan when she was given parliamentary permission to invoke Article 50 - it was almost criminal intent as to what she did.

9. Andy , Thursday, September 26, 2024, 14:54:

JJ, 8.
It isn't 'revisionist form of history'. The fact that the UK whilst a member state, agreed to a 7 year MFF is actually irrelevant. The revenue can only be gained in accord with what is set out in the treaties, and once a member country leaves there is no legal basis for that former member to continue to fund the EU under the terms of a treaty to which it is no longer a signatory. This was pointed out to Barnier by David Davis, but he was totally undercut by the evil Mrs May and her poodle. If you care to read the treaties there is no provision for a former member to pay a brass cent.
As to invoking Article 50, the Supreme Court (a Blair creation) made a 'political decision', just like they did with prorogation, although that was a more clear perversion of the Consitution and the Law: careful reading of the 1972 Act with a proper understanding of how it was written shows clearly that the Crown could invoke Article 50 of its own accord. All that was required was to repeal the 1972 Act and we would have left the EU. The treaties would become null and void.

10. John Jones , Thursday, September 26, 2024, 21:46:

9. Andy
Up until the Lisbon treaty - leaving the EU was as Douglas Hague said " trying to leave a burning building without a front or back door".
Unfortunately, the Lisbon Treaty also made it a legal international treaty obligation to leave via Article 50 ( however invoked).
Life is what it is - not what we'd like it to be.
Please, don't quote David Davies - he genuinely was as thick as mince and duly got his just rewards - Barnier at least knew what he was talking about & getting the better of the unprepared Brits in negotiations.
We got what we deserved - no more or less.

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