Theresa May told concessions needed for to trade talks with EU

European Union leaders have made clear to Prime Minister Theresa May that she must make more concessions on Britain's Brexit 'divorce payment' in order to unlock talks on a future trading relationship with the bloc.

British Prime Minister Theresa May speaks with Malta's Prime Minister Joseph Muscat. Picture: AP Photo/Virginia Mayo, Pool

French president Emmanuel Macron suggested that the bill could top €40 billion (about £36bn), saying that earlier indications that the UK could offer around €20bn to ensure its EU partners were not left out of pocket due to Brexit did not go half-way to what was required.

The Prime Minister repeatedly dodged questions at the European Council summit in Brussels over how much the UK is ready to pay, insisting that the size of a “full and final settlement” will not emerge until agreement is reached on all aspects of Brexit.

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But she did not deny suggestions that it could be “many more billions” than the €20bn indicated in her speech in Florence last month.

Mrs May said UK officials will spend the coming weeks going through Britain’s financial commitments to the EU “line by line”, ahead of a pre-Christmas summit when it is hoped leaders of the 27 remaining EU states will finally give the green light to the second phase of Brexit talks.

The EU27 took just 90 seconds to approve a programme of internal work on their position on trade in preparation for possible talks. But they made clear that this step will depend on further progress being made on divorce issues including expats’ rights, the Irish border and, in particular, the financial settlement.

In their formal conclusions, the EU27 said they aimed to move to the second phase “as soon as possible” and would reassess the state of progress at the next summit on 14-15 December. However, they ­noted that Britain has so far made no “firm and concrete commitment” to settle all of its obligations.

Mr Macron said that “much work needs to be done”.

“I would say we are far from having reached the necessary financial commitments before we can open phase two,” he said. “We are not half-way there.”

German chancellor Angela Merkel said that a breakthrough in December “depends to a large extent” on the UK. She added: “The ­topic of financial commitments is the dominating issue in that regard.”

Irish Taoiseach Leo Varadkar said detail on the UK bill had to be worked out.

“There wasn’t anything new on the financial solution. That’s still ongoing,” he said.

“Prime Minister May has indicated that no European state should have to pay more or receive less than would have been the case had they not been leaving, that they would honour their existing commitments.”

Asked whether she would deliver further details on the divorce bill in time in order to secure progress in two months’ time, Mrs May said: “What we are doing as we look across the weeks coming up to the December Council is looking at a range of issues.”