Prime minister Theresa May is expected to formally present the breakthrough offer next week as part of package deal if agreement can be reached on the other issues of citizen rights and the contentious question of the border between Northern Ireland and the Republic. [...]
Negotiators are working on how to present the settlement as a net estimate, with the UK side pressing for an implied figure of between €40-45bn once UK receipts and other deductions are taken into account. “They have promised to cover it all, we don’t care what they say their estimate is,” said one senior EU diplomat. “We’re happy to help them present it.”
Intensive negotiations are continuing, with the aim of reaching a declaring “sufficient progress” next week on the financial settlement, citizen rights and Northern Ireland. Discussions are delicately poised and negotiators have warned that a hold-up on any one element of talks could scupper a December deal to open trade talks.
Both sides say no final figure will be agreed on Britain’s exit settlement next week. Significantly the UK plans to avoid a lump-sum settlement and instead will develop a system for regularly calculating payments in years to come, when specific liabilities come due.
Under this model, pensions of EU officials, for instance, could be paid on the basis of annual costs, meaning there will be no final figure for the so-called “Brexit bill” until the final eligible EU pensioner is dead, many decades from today.
The political compromise engineered between London and Brussels aims to guarantee to the other 27 EU member states that there will be no Brexit gap in the discharge of the current EU budget, while allowing the UK to point to much lower estimates of net payments and contingent liabilities. [...]
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