LORDS

Deal or no deal, the UK should honour its financial obligations

23 October 2019

The EU Financial Affairs Sub-Committee today publishes its report on the financial settlement contained in the Withdrawal Agreement. The report argues that there would be serious implications for future negotiations with the EU and the UK's wider reputation if the UK did not honour the terms of the financial settlement.

While it would be difficult to enforce the UK's financial obligations in any international court or tribunal, the Committee notes that this does not mean that such obligations do not exist.

The Committee welcomes Government statements that the UK will always "pay its dues", and highlights indications from the EU institutions that negotiations on a future relationship will not start until the UK’s financial obligations are honoured.

Chairman's comments

Commenting on the report, Lord Sharkey, Chair of the House of Lords EU Financial Affairs Sub-Committee, said:

"When he was the Brexit Secretary, Dominic Raab told us that 'Her Majesty's Government and the United Kingdom always pay their dues'. Deal or no deal, the UK should honour its financial obligations.

"Seeking to revisit or disown the agreed financial settlement would have profound implications for the UK's future relationship with the EU and its reputation more broadly."

Key findings

  • Honouring the UK’s financial obligations is a matter of politics as well as law. Seeking to revisit the terms of the financial settlement could have implications for future negotiations with the EU and the UK’s wider reputation.
  • While it would be difficult to enforce the UK’s financial obligations in any international court or tribunal, this does not mean that such obligations do not exist.
  • Failure by the UK Government to honour the financial settlement would be received negatively by the EU. Statements by the EU institutions suggest that they are currently unwilling either to renegotiate its terms or to start negotiations on a future relationship until this issue is resolved.

Further information

More news on: Parliament, government and politics, Parliament, European Union, EU budget, EU law and treaties, House of Lords news, Lords news, Committee news, Exiting the European Union

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