Brexit ‘divorce bill’ does not guarantee EU trade deal

MPs will be asked to sign off a £39bn Brexit “divorce bill” later this year without any legal assurance that the EU will agree an ambitious future trade relationship, a Brexit minister has admitted.

Tory Eurosceptics have always insisted that the money is Britain is the biggest bargaining chip in negotiations on a future trade deal, but Suella Braverman conceded there was no legal link between the two.

In a gruelling session in front of MPs on the House of Commons Brexit committee, Ms Braverman said Britain would rely on a “duty of good faith” in the EU withdrawal treaty to ensure that Brussels delivered a good trade deal.

But as the session went on, the pro-Leave minister suggested Britain could try to reclaim some of the £39bn exit payment, if trade talks did not go to plan. “We could return to a negotiation,” she said.

When it was put to her that the EU would never agree to renegotiate the exit bill, she said: “It’s very difficult to make predictions about what would happen a year from now.”

Her awkward appearance reinforced the weakness in Britain’s negotiating position and undermined a key argument by Brexiters that the UK could threaten to withhold money if it does not get a good trade deal.

The problem arises because the financial exit settlement forms part of the legal EU withdrawal treaty: it has to be ratified by the British parliament before Brexit day on March 29 2019.

However, the EU will not begin detailed discussions on a future relationship — including a possible free trade agreement — until after Britain leaves the EU and formally becomes “a third country”.

When MPs vote on the EU withdrawal treaty later this year — including signing off the exit payment — their only indication of the future trade deal envisaged by both sides will be a political declaration.

Peter Bone, a Eurosceptic Tory MP, said he hoped the government would insert legal clauses to ensure the exit payment was conditional on a good final trade deal.

“We have to be able to see we are not just giving £39bn away on a political wish,” he said.

But Pat McFadden, a Labour member of the Brexit committee, said Ms Braverman “was forced to admit that the financial settlement with the EU is part of the withdrawal agreement was not conditional on agreement on the future relationship”.

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Source: Financial Times

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