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Old 22-10-2017, 11:18 AM
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Overview of the Brexit Divorce bill by the UK think tank the Institute for Government.

IFG September 2017
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How much might this be?

The Financial Times in November 2016 originally reported that the European Commission was seeking an exit bill of €60 billion, based on comments by Michel Barnier, the EU’s chief negotiator on Brexit. In February, the same author writing for the Centre for European Reform (CER) estimated that the bill could range from €25–73 billion. Bruegel have given a similar range for the bill, at €25.4–65.1 billion. Most recently, Alex Barker, writing again in the Financial Times, put the net bill at €55–75 billion, based on a €91–€113 billion gross figure.

How did they work out the figures for this divorce bill?

Calculations are based on what we owe, and what we can offset. The quoted figures have a large range due to varying methodologies of calculating the bill. The lower band €25 billion represents minimal obligations to the EU and maximum UK receipts, while the top-end €75 billion comes from maximising the UK’s obligations and minimising its receipts. The gross figures of €100 billion includes some extra obligations and does not take any account of any receipts owed to the UK.

The UK’s obligations can be categorised under various headings:

1. Outstanding budget commitments

The EU Budget operates through a multi-annual spending structure, which means projects are paid for over a period of several years. As a result, EU Budget payments are back-loaded and many will be paid out post-Brexit. For example, a key element of EU spending allocations consists of cohesion fund payments, aimed at raising living standards in the 2004 Accession countries. According to the CER, only 25–30% of the biggest cohesion fund payments will actually have been spent by the time Britain is expected to leave the EU in April 2019.

The current EU Budget period runs from 2014–2020, finishing a year after the UK’s exit date. A key point of legal uncertainty is the status of financial commitments scheduled for 2019 and 2020. The UK has indicated that it only expects to fund its budget commitments up until April 2019. However, the Commission's methodology is clear that the UK should meet the full schedule of obligations up until 2020.

2. EU officials’ pensions

Like the UK civil service pension scheme, the Pension Scheme of European Officials (PESO) is an unfunded scheme and operates on a ‘pay-as-you-go basis’, with costs being covered by the annual EU Budget as they arise. The Commission outlines that the UK should make a payment to cover the costs associated with this scheme, as they appear in the EU's consolidated accounts at the time of the UK's withdrawal. There have been suggestions that the UK could push for this liability to simply cover the costs of UK nationals working for the Commission, lowering the bill due to the under-representation of British officials. The Commission's methodology suggests that the EU would contest such an approach.

3. Contingent liabilities

The EU incurred contingent liabilities while the UK was a member state. These liabilities effectively constitute payments that would be triggered in specific circumstances only, for example, Ukraine defaulting on its EU loan. When the 2015 EU accounts were drawn up, outstanding loans to Hungary, Ireland, Portugal and Ukraine collectively amounted to €49.5 billion. The EU’s latest approach asks the UK to make a lump-sum payment upfront to cover these liabilities, in case they materialise in the future. This increases the upfront divorce bill by €9–12 billion. However, these upfront liability payments would be reimbursed over the coming years, enabling the UK to recover some of this money.

4. Other costs of withdrawal

The Commission’s negotiating mandate also includes the “specific costs related to the withdrawal process”. This would cover the relocation of the two London-based EU agencies after Brexit; the European Banking Authority and the European Medicines Agency. Other costs include the decommissioning of the Joint Research Centre nuclear sites and funding British teachers seconded to European schools until 2021.

The detail of all the headings that the Commission has put on the table is set out in its working paper “Essential Principles on Financial Settlement”, published on 24 May. Reports from Brussels suggested that the Commission’s original position was toughened up by member states in internal discussions to include, for example, continued support for CAP payments.

Do we get anything in return?

The divorce bill could be offset partly by the UK’s share of EU assets, rebates and budget receipts. Some could be immediate deductions from the bill, while others could be longer-term payments over the next decade or more. Potential issues are:

Budget receipts - money that the UK would have got from the EU Budget
Rebate credits - repayment of outstanding credits from earlier contributions
Asset shares - this is likely to be the most contentious, with arguments about whether the UK is entitled to shares of the value of buildings and a share of the capital of the European Investment Bank (EIB).The Commission's methodology outlines that the UK's paid-in capital to the EIB will be returned, but only after the EIB's loan book is balanced.
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  #1282  
Old 22-10-2017, 12:17 PM
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Originally Posted by Mykidsmom View Post
You know i think your very cute cogs...but you need to answer my question.....its uncivil not to.....and im concerned we have HALF members here...if someone is not allowed on certain threads....this is a new type of membership....
you might get a response in the new "bitchin' " section helen........can't wait to see it.......
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Old 22-10-2017, 04:51 PM
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Got there katie.....hugs..!!!!!!!!!!!!
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Old 27-10-2017, 08:41 PM
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Originally Posted by KatieMorag View Post
you might get a response in the new "bitchin' " section helen........can't wait to see it.......
now ye see it. ....now ye dont
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Old 27-10-2017, 08:42 PM
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Green party call for second referendum on Brit Exit
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Old 27-10-2017, 08:43 PM
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Originally Posted by DAMNTHEWEATHER View Post
Green party call for second referendum on Brit Exit
I def see a second vote on the horizon......im happy everything will be reversed if it happens.
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Old 27-10-2017, 08:45 PM
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Originally Posted by DAMNTHEWEATHER View Post
Green party call for second referendum on Brit Exit

Democracy will rule the day.....

And they wont like it whichever.........

Now, any chance of you posting a few facts.......You are constantly speculating and mostly wrong.....
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Old 28-10-2017, 12:09 AM
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Originally Posted by quinner View Post
Democracy will rule the day.....

And they wont like it whichever.........

Now, any chance of you posting a few facts.......You are constantly speculating and mostly wrong.....
Wotz upwicha oive had spectacles for years.
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Old 24-12-2017, 12:00 PM
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Originally Posted by quinner View Post
Now, any chance of you posting a few facts.......You are constantly speculating and mostly wrong.....
51% now say REMAIN ... it proves what i told you from scratch The loons who carried the vote Thats the1.2 million didnt have a clue what they were voting for....now weve had a taste.....they want the oposite......strange oul world eh ?
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Old 27-12-2017, 12:24 AM
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Anyone got their blue passport yet ?
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