The EU "divorce bill"

Published: 11th Jan 2018

The latest estimate for the size of the UK’s ‘divorce bill’ with the EU is £35-39 billion, which is roughly €39-43 billion.

This is based on calculations the UK and EU have agreed, although the final value may still change. On 11th December 2017, the Prime Minister confirmed that the UK and the EU have agreed “the scope of commitments, and methods for valuations and adjustments to those values.” The calculations are an estimate of the UK’s commitments to the EU, valued according to a set of agreed principles. The bill is made up of:

  • The UK’s contribution to EU annual budgets up to 2020;
  • Payment of outstanding commitments; and
  • Financing liabilities up to the end of 2020.

Theresa May said that this is ‘subject to the general reservation that nothing is agreed until everything is agreed’. The offer depends on agreements in the next stage of talks about the UK’s future relationship with the EU.

Previous reports about the size of the agreed bill have varied a great deal

In late November, the Telegraph reported that the final payment figure will be “between €45bn and €55bn, depending on how each side calculates the output from an agreed methodology”. That’s between around £40bn and £49bn. They say these terms were agreed at a meeting between both sides in Brussels

Alex Barker and George Parker of the Financial Times says of the same negotiations that the UK will assume liabilities “worth up to €100bn” (£88bn). However, he says that the net figure (after deductions for payments made to the UK) could fall to less than half of that – “with the UK side pressing for an implied figure of €40-45bn” (£35-£40bn).

These reports were neither confirmed nor denied by the UK and EU sides at the time.

The Prime Minister said in a major speech in Florence in September that: “I do not want our partners to fear that they will need to pay more or receive less over the remainder of the current budget plan as a result of our decision to leave. The UK will honour commitments we have made during the period of our membership.”A Sunday Times report in September also suggested the Prime Minister could approve a bill worth up to £50 billion (€54bn), while in August the Sunday Telegraph suggested £36 billion (€40bn) was considered by the UK as the sum likely to be reached through negotiations with the EU.

But Downing Street sources dismissed the £36 billion figure at the time as “highly speculative and wrong” while they don’t recognise the £50 billion claim.

Researchers’ estimates for the bill size have also varied a lot

Researchers have speculated previously what the size of the demand might be, and €60 billion is within the range of several of the estimates so far.

The same figure had been circulating in Brussels since last year. More recent reports that the EU view of what to ask the UK to pay for was hardening led Alex Barker of the Financial Times to calculate an upfront demand of between €91-113 billion.

Mr Barker said this would come down to roughly €55-75 billion net as Britain received money back. Other researchers have given ranges of €16-22 billion and €25-65 billion.

There was no definitive figure for how much the EU will ask for. Professor Iain Begg, an EU budget expert, has said that calculations can only be “on the back of an envelope”.

These calculations are complicated: there are various liabilities apart from just the core EU budget; the UK’s share of these isn’t settled; and there’s the question of whether the UK is entitled to a portion of EU assets. So there are different figures for different assumptions and scenarios. Lower estimates assume “minimal obligations to the EU and maximum UK receipts”, whereas higher ones “maximis[e] the UK’s obligations and minimis[e] its receipts, as the Institute for Government puts it.

Nor do we know how much the UK government will actually agree to.

A House of Lords report has argued that legally the UK isn’t required to pay a penny. This has been disputed by some legal experts, and the report itself acknowledges that there are “competing interpretations”.

Correction 9 August 2017

We've removed the currency reference from the claim, which wasn't actually specified on the programme.

This factcheck is part of a roundup of BBC Question Time. Read the roundup.


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