Brexit process could derail over '˜flimsy' EU cash demands

EU negotiators have been warned the 'inflexible' guidelines for Brussels talks could derail the Brexit process as the impasse over the UK's so-called 'divorce bill' deepened.

EU negotiators have been warned over cash demands. Picture: Jane Barlow/PA Wire

Criticism from senior EU figures over the quality of the UK’s Brexit position papers drew a withering response, with a source suggesting the European Commission’s outline for its financial demand is too flimsy to act upon.

The governments of the EU’s 27 member states would have to agree to revise the mandate issued to European Commission’s Article 50 task force in order to allow a compromise to take place, it is understood.

Responding for the first time to EU demands that could run to £80 billion during “intense” technical negotiations, UK negotiators told European counterparts that a Brexit bill calculated using the EU’s seven-year funding framework had no basis in law.

However, the UK accepted that it faces “surviving liabilities” which must be paid for whether there is a Brexit deal or not.

While UK negotiators are believed to be optimistic of making progress on issues such as citizens’ rights and the status of the Irish border by an EU-imposed October deadline, there is growing concern that the wide gulf over money could stall talks.

Yesterday the European Parliament’s chief Brexit spokesman, Guy Verhofstadt, said it would be “very difficult” to break the deadlock by the time 27 member states gather to decide whether talks can move on to the UK’s future trading relationship and a post-Brexit transition phase.

A source familiar with the UK’s negotiating position said: “The UK is not convinced that the European Commission’s paper [on the financial settlement] is satisfactory.

“Nobody would write a cheque on the basis of the Commission’s four-page paper.”

The source added: “There is some concern about what the UK say is an inflexibility to the Commission’s approach.

“That it’s difficult to negotiate with people who have perhaps not been given the flexibility to negotiate.”

EU chief negotiator Michel Barnier appeared to respond to pressure over his negotiating mandate, tweeting: “Guidelines are designed for serious and constructive negotiations, but we need clear UK positions on all issues.”

The second round of substantive talks will close today with a joint press conference by Mr Barnier and Brexit Secretary David Davis, who returned to Brussels last night for talks with British officials.