Beautiful Virgin Islands

Tuesday, Feb 27, 2024

Brexit: European interest rates rise may push up UK’s divorce bill by £5bn

Brexit: European interest rates rise may push up UK’s divorce bill by £5bn

New Treasury estimate comes as European Central Bank increases interest rates for first time in 11 years

Increasing interest rates in Europe could push up the UK’s Brexit divorce bill by £5bn, the government’s Treasury office has said.

The new estimate comes as the European Central Bank increased its interest rates for the first time in 11 years by 0.5 percentage points, ahead of the 0.25 percentage points expected by economists.

Simon Clarke, the chief secretary to the Treasury, made clear in a written statement that rising interest rates affecting EU pension obligations were the driving force behind the new divorce bill estimates.

The Brexit divorce bill includes the working out of long-term guarantees on certain lending and spending by EU institutions while the UK was still a member of the bloc.

Originally the government estimated the bill covering spending commitments would be between £35bn and £39bn. This included loans guaranteed by the European Investment Bank for infrastructure and other projects signed off during the UK’s membership.

No finite settlement was agreed as the bill takes account of performance of loans. The Treasury’s latest estimate put the figure at £42.5bn, up from £37.3bn a year ago.

In a written ministerial statement, Clarke said the rise was primarily down to the UK’s obligations for EU pensions.

“The primary drivers are the latest discount rates and inflation assumptions, which are centrally set by the government for valuing long-term liabilities,” he added. “However, given this is a multi-decade liability, the variables used in this forecast will continue to fluctuate up and down.”

Up until the end of last year, the UK says it has paid £5.8bn to the EU as part of the agreement.

A Treasury spokesperson added: “The unprecedented recent rise in inflation and changes in discount rates have increased our pensions liability, which is the biggest reason for the increased estimate.

“The true cost of the settlement is confirmed when payments are made, based on the value at the time. The Treasury continues to monitor and verify these payments in line with the negotiated agreement.”

The European Commission had calculated the divorce bill higher than the UK had at £41bn, at the time of the three-party withdrawal agreement which also included pacts on Northern Ireland and EU citizens’ rights.

The shadow of the withdrawal agreement continues to be cast on EU-UK relations with prime ministerial hopeful Liz Truss threatening to tear up the Brexit trade arrangements for Northern Ireland.

In turn the EU has delayed ratification of the UK’s associate membership of the flagship £80bn Horizon Europe science research programme, causing the loss of funding for some academic projects already greenlit by the European Research Council.

On Thursday 24 groups including the Royal Society, the Russell Group of universities and Cancer Research UK called on the two candidates battling to become the UK’s prime minister, Truss and Rishi Sunak, to commit to keeping the UK’s leading place in research, development and innovation (RDI).

In a letter to the candidates, they urged them to make membership of Horizon Europe a priority and to commit to spending 3% of GDP on RDI.

Newsletter

Related Articles

Beautiful Virgin Islands
Farmers break through police barriers in Brussels.
I have a dream, MLK inspiring speech
London's Iconic British Telecom Tower Sold To Become Hotel
Aretha Franklin, Marvis Staples - Oh Happy Day
Ukraine Arrests Father-Son Duo In Lockbit Cybercrime Bust
BVI Freedom Song
US Offers $15 Million For Info On Leaders Of Cybercrime Group Lockbit
Billy Preston - You Can't Beat God Giving (Live)
Russia Claims UK Cultural Agency Spied for Ukraine
VIRGIN ISLANDS REGGAE CARIBBEAN RIDDIMZ
Apple warns against drying iPhones with rice
Oh Happy Day Edwin Hawkins - Anthony Brown w FBCG Combined Choir
Alexei Navalny: UK sanctions Russian prison chiefs after activist's death
'Stand by Me' performed by Karen Gibson and The Kingdom Choir
German economy is in 'troubled waters' - ministry
National Anthem of the British Virgin Islands - Oh, Beautiful Virgin
In a recent High Court hearing, the U.S. argued that Julian Assange endangered lives by releasing classified information.
Hello Dolly
New video
for KING & COUNTRY - Amen (Reborn) [feat. Lecrae & The WRLDFMS Tony Wi
Tucker Carlson says Boris Johnson wants "a million dollars, in Bitcoin or cash, from Tucker Carlson to talk about Ukraine.
Bob Marley - Get Up Stand Up
Russia is rebuilding capacity to destabilize European countries, new UK report warns
Yes He Can
EU Commission wants anti-drone defenses at Brussels HQ
What A Friend We Have In Jesus
Von der Leyen’s 2nd-term pitch: More military might, less climate talk
Unforgettable
Global Law Enforcement Dismantles Lockbit Ransomware Operation
Touch The Hem Of His Garment
Prince William Urges End to Gaza Conflict
The Lord's Prayer
UK court to hear Assange's final appeal against extradition to the US, where he faces charges related to his journalistic work—the publication of a classified video in 2010 that exposed US war crimes against humanity.
THE GOD MOVEMENT...BEAUTIFUL BVI
About 50-60% kids either chose to be YouTuber or influencer
Siyahamba
A viral video of Nationals MP Barnaby Joyce lying on a Canberra footpath is celebrated by his media mates.
Ray Charles And The Voices Of Jubilaton, Oh, Happy Day
European Countries React to Navalny's Death by Summoning Russian Diplomats
Ramblin' Rose
Israel has gone ‘beyond self-defence’ in Gaza, says Labour’s Streeting
Protoje - Who Knows ft. Chronixx
English farmers to be offered ‘largest ever’ grant scheme amid food security concerns
Pressure - Virgin Islands Nice
Cameron government knew Post Office ditched Horizon IT investigation
Phil Wickham - House Of The Lord
EU Calls for Immediate Ceasefire in Gaza Conflict
My God Is Real (Yes, God Is Real)
EU Vows To Hold Putin "Accountable" After Meeting Alexei Navalny's Wife
The Lion King Circle of Life by LEBO M. — LIVE at the HAVASI Symphonic
EU Launches Probe Into TikTok Over Child Protection Under Digital Content Law
Louis Armstrong - When The Saints Go Marching In
The EU Initiates Naval Mission to Defend Red Sea Trade Routes
Kanye West Sunday Service - hallelujah, salvation, and glory
EU and UK Announce Joint Effort on Migration
Jonathan Nelson - I Believe (Island Medley
Brazil's Lula Likens Gaza Operation to Holocaust, Israel Says "Red Line" Crossed
From The Virgin Islands Sqad Up
Ministers Confirm Proposal to Prohibit Mobile Phone Usage in English Schools
Common, John Legend - Glory
Microsoft-backed OpenAI valued at $80bn after company completes deal
Anthony Evans vs. Jesse Campbell - If I Ain't Got You
‘Alexei would want to tell Russia not to give up fighting’
I have a dream, MLK inspiring speech
Rwandan Footballer's Dismissal Sparks Concerns Over UK Asylum Plan
Aretha Franklin, Marvis Staples - Oh Happy Day
Whisky Challenges China's Baijiu Market During New Year Celebrations
BVI Freedom Song
Avdiivka - Symbol Of Ukrainian Resistance Now In Control Of Russian Troops
Billy Preston - You Can't Beat God Giving (Live)
Putin Critic Alexei Navalny's "Killers" Refusing To Hand Over Body, Say Allies
VIRGIN ISLANDS REGGAE CARIBBEAN RIDDIMZ
"Historic Step": Zelensky Signs Security Pact With Germany
Oh Happy Day Edwin Hawkins - Anthony Brown w FBCG Combined Choir
"Historic Step": Zelensky Signs Security Pact With Germany
'Stand by Me' performed by Karen Gibson and The Kingdom Choir
20 Tech Giants Sign Effort To Fight AI Election Interference Across Globe
National Anthem of the British Virgin Islands - Oh, Beautiful Virgin
Joe Biden Accuses Putin of Causing Navalny's Death
Hello Dolly
Russian opposition leader Alexey Navalny has died at the Arctic prison colony
for KING & COUNTRY - Amen (Reborn) [feat. Lecrae & The WRLDFMS Tony Wi
Tucker Carlson grocery shopping in Russia. This is so interesting.
Bob Marley - Get Up Stand Up
Julian Assange's Wife Warns of His Death if Extradited to US
Yes He Can
‘A lot higher than we expected’: Russian arms production worries Europe’s war planners
What A Friend We Have In Jesus
Greece Legalizes Same-Sex Marriage and Adoption Rights
Unforgettable
Hungarian Foreign Minister: Europeans will lose Europe, the Union's policy must change drastically
Touch The Hem Of His Garment
In Britain Homeowners are receiving CPO’s (Compulsory Purchase Orders) so their homes can be redistributed to migrants
The Lord's Prayer
Microsoft says it caught hackers from China, Russia and Iran using its AI tools
THE GOD MOVEMENT...BEAUTIFUL BVI
Influencers Exploit X Platform for Profit Amidst Israel-Gaza Conflict
Siyahamba
Former Dutch PM And Wife Die "Together Hand In Hand" Via Duo Euthanasia
Ray Charles And The Voices Of Jubilaton, Oh, Happy Day
×