Brexit
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- hans_glib0
yay!
from the times
Brexit will cost ‘at least £10bn’ more than taxpayers were told
The Brexit divorce bill will end up being at least £10 billion more than ministers claimed at the time the deal was signed, a report by the government’s financial watchdog suggests.
The National Audit Office (NAO) accused the Treasury of failing to incorporate key uncertainties of “which it was aware” when ministers announced that the settlement would cost Britain between £35 billion and £39 billion.
The government’s estimate did not include Britain’s commitment to the European fund that hands out overseas aid, the NAO said, adding that this would cost £2.9 billion after Brexit. The Treasury claimed it did not include the payments because the fund is not included in the main EU budget.
The divorce bill estimate includes EU payments directly to the private sector worth £7.2 billion. The Treasury assumed that all EU loans to member states, companies and other institutions would be paid back. But in the agreement Britain has accepted €14 billion for its share of these contingent liabilities which it will have to pay if any debtors default.
The NAO report also said the terms of the settlement gave “scope” for the European Commission to take decisions that would increase Britain’s payments. The commission could reclassify liabilities so they were included in the calculation of settlement payments, or dispose of assets shortly after the end of 2020. The EU could also “fast-track” funding applications towards the end of the current budgetary period to ensure the commitment was “made in time for the UK to contribute to its cost”.
The NAO concluded that the “total cost of the settlement cannot be defined until there is greater certainty around future events”. It identified areas of uncertainty such as the UK’s economic performance in 2019 and 2020, the cost of pension liabilities and exchange rate fluctuations as the divorce bill will be paid in euros.