Britain is willing to pay billions of pounds to the EU as part of Keir Starmer’s Brexit ‘reset’.
Downing Street has signalled that the Prime Minister is preparing to give in to EU demands for cash payments in return for improved access to the single market.
Formal talks on implementing the PM’s reset deal are due to resume next week.
Brussels is said to have irritated ministers by tabling a late demand for the UK to contribute to the EU’s ‘regional cohesion fund’ which pays for infrastructure like roads and bridges in deprived parts of the EU.
Government sources said additional payments would not be required to finalise agreements already made on food standards and carbon emissions.
But No 10 suggested Sir Keir is willing to sign off payments in return for closer trading ties with Brussels in the future.
Asked about the prospect of further UK contributions, a No 10 spokesman told reporters: ‘On cohesion funds, we have always said that if a proportionate contribution to a specific EU system would result in tangible benefits to the UK then that is the sensible, fair and pragmatic decision we will take.’
The size of any payments will be the subject of intense negotiations but could eventually run into billions of pounds a year.
Keir Starmer and EU chief Ursula von der Leyen discussed the next stage of the Brexit reset on Wednesday
No 10 said Sir Keir is also ready to pay billions into the EU’s Security Access for Europe Fund (Safe) in return for greater access for British firms to EU defence contracts. The EU is demanding up to £6 billion in return for granting access to the UK.
Any payments will eat into the £9 billion benefit ministers hope to achieve by cutting red tape on things like agricultural exports.
The PM discussed the next stage of the Brexit reset with EU chief Ursula von der Leyen in a phone call on Wednesday evening.
A No 10 spokesman said the two leaders ‘reaffirmed their commitment to moving forwards rapidly, as it is in the UK and the EU’s interests to have a broad and constructive relationship that delivers for both sides’.
Shadow foreign secretary Priti Patel accused Labour of ‘betraying Brexit’.
She added: ‘It’s outrageous that Labour are plotting to whack up taxes on hard-working British families and businesses to bankroll the EU. Under Labour our standing in the world keep falling and Starmer is letting the EU bully him into handing over more British taxpayers money just so he can feel good at the next summit he goes to.
‘Starmer is so desperate for praise and adulation that he’s selling out the British people to get a few pats on the back from his EU friends.’
But ministers believe the reset will reduce post-Brexit trade barriers, boosting business and potentially cutting prices.
EU relations minister Nick Thomas-Symonds said the resumption of talks represented ‘welcome progress’, adding: ‘We can now start formal talks on deals that will help keep food costs down and slash red tape.
‘We are delivering on the commitments made to British businesses and the public at the historic UK-EU Summit in May. These agreements will add nearly £9 billion to the UK economy, supporting British jobs and putting more money in people’s pockets.’
France had pushed for the UK to make contributions to the EU cohesion fund as part of the talks beginning next week. But government sources said this demand had now been dropped, and that the issue would only be discussed as part of future negotiations.
The current deal will see trade barriers reduced in agriculture in return for the UK agreeing to align itself permanently with EU regulations. In return, the UK will have to accept some form of EU mobility scheme and is under pressure to drop post-Brexit innovations, such as the development of gene editing and the ban on live animal exports.
Mr Thomas-Symonds has said the deal will be in place by 2027. Ministers are now considering whether to push for further alignment in the future in areas like chemicals.
