If you are a fellow Brexiteer like me, you may be having some difficulty in identifying a political party to place your trust in during this time of uncertainty. In this instance, this does not mean selecting a party to mark your cross by in general elections, but a party capable, and wholly committed, to delivering a Brexit that echoes the voice of the 17.4 million Britons who voted to leave the EU on June 23. Both the Conservatives and the Labour Party insist that they respect the outcome of the EU Referendum, and are committed to delivering Brexit, but at what cost? What are both parties willing to compromise in order to deliver this outcome? And will such compromises reflect the will of the people? These are questions which I often ponder.
It would seem that the Conservatives have somewhat softened their stance on Brexit, following a catastrophic general election which resulted in the party losing 13 seats on May 8. On the other hand, Jeremy Corbyn’s Labour Party enjoyed some success by gaining 30 seats in Westminster, despite losing the election overall. However, it is the post-election reality as opposed to the tough, pre-election rhetoric that will be a concern to many. We have recently learned that the Labour Party would now seek to keep Britain in the Single Market and the Customs Union during the Brexit transition period; contrary to stating in their 2017 manifesto that membership of both institutions would not be considered under a Labour government. Meanwhile, since retaining her place as Prime Minister in a shambolic general election, Theresa May has stood by her claim that “no deal is better than a bad deal” for Britain as we enter negotiations with the EU. But after entering the 3rd round of talks with the EU, Theresa May’s government have been met with the same obstacle – The so-called “divorce bill”.
Since Michel Barnier warned that Britain must meet all financial liabilities before talks of a post-Brexit trade deal with the EU could take place, the so-called “divorce bill” has been a sticking point for both sides despite recently entering the 3rd round of discussions. The earliest reports in February suggested that such a bill could be in the region of €60 billion; this was raised by the EU to €100 billion in May, a figure which seemed absurd, and frankly insulting to many Brexiteers like me. Mr Barnier, on the other hand, had a different opinion on the matter. He insisted that “there is no Brexit bill” and that “the financial settlement is only about settling the accounts”. As one of the largest net contributors to the EU budget, Mr Barnier’s remarks ultimately beg one question – What does Britain actually owe the EU?
For many years, Britain has consistently been one of the largest net contributors to the EU budget; meaning we pay more into this budget than we receive in return from the EU. In 2016 alone, Britain paid £13.1 billion to the EU budget, and with EU spending on the UK forecasted to be £4.5 billion, this meant that Britain’s net contribution was approximately £8.6 billion. When we hear the term “divorce bill” in the press, this refers to a financial settlement which the EU believes Britain has an obligation to meet on exiting the EU; it will be supposedly calculated based on factors such as the ongoing EU budget, loan liabilities, and the cost of relocating agencies such as the European Banking Authority which is currently based in the UK. You may be reading this and fearing the prospect of a large exit bill, coming at the expense of you, the taxpayer, on the other hand, you may be wondering how we could possibly have any accounts to settle with an institution that has, in effect, reaped the financial benefits of our longstanding membership. If you were wondering the latter, then you are also probably trying to calculate an estimate of the so-called “divorce bill”, with little success and a feeling of utter bewilderment. However, this is a matter far less complex than it is portrayed to be, so fear not.
The Treaty of Lisbon, enforced in 2009, introduced an exit clause which means that an EU member state has the constitutional right to withdraw from the EU, in accordance with its own constitutional requirements. In Britain, we most commonly refer to this clause as Article 50, which has now been triggered by Theresa May. The two-year period, known as the ‘sunset period’, is a time for both the state and the EU to negotiate matters such as post-withdrawal trade, legal obligations, and future relations. However, whilst Article 50 specifies that both the EU and the state must undergo two years of negotiations prior to withdrawal, the clause does not specify that a financial settlement must be met by the state leaving the EU.
As part of Article 50, item 2 states the following:
“A Member State which decides to withdraw shall notify the European Council of its intention. In the light of the guidelines provided by the European Council, the Union shall negotiate and conclude an agreement with that State, setting out the arrangements for its withdrawal, taking account of the framework for its future relationship with the Union” (Article 50, The Lisbon Treaty, 2007).
So, why is this significant in regards to Brexit? Well, it is significant because it demonstrates one very clear truth – Britain has no legal obligation to pay any “divorce bill” to Brussels. With this in mind, one could argue that should the EU insist on a financial settlement before further negotiations can take place, then perhaps it would be in our national interest to simply walk away from EU negotiations. After all, any financial settlement would be a burden on the British taxpayer, a burden we simply should not have to carry.
The EU has stood firm in their pursuit of a financial settlement from Britain, and does not seem to be softening their stance as negotiations press on. If no deal is truly better than a bad deal in the eyes of Theresa May, why is Britain still sat at the negotiating table? Should Britain give into EU demands and pay a financial settlement, this would certainly constitute as a bad deal for the British public. Not only is this a contradiction of the concept “taking back control”, as so often paraphrased throughout the EU Referendum, it would also demonstrate a total disregard for the framework outlined in Article 50. As negotiations continue, the British government needs to be strong in their pursuit of delivering the democratic mandate given to them by the people of Britain, but on the same token, they also need to be brave enough to walk away if such negotiations are not in our national interest.
The Lisbon Treaty (2007), Article 50 [online]. Available at: http://www.lisbon-treaty.org/wcm/the-lisbon-treaty/treaty-on-european-union-and-comments/title-6-final-provisions/137-article-50.html [Accessed 4 September 2017]