Sir Keir Starmer and European Commission President Ursula von der Leyen (Image: Getty)
As Keir Starmer pursues his reset with the EU, a new Treasury report has exposed the UK’s continued £1.3 billion payment to Brussels in 2025, raising fresh questions about Britain’s leverage in ongoing negotiations. The European Union Finances Statement 2025, published by HM Treasury on March 26, details how Britain continued to meet its obligations under the Withdrawal Agreement through a series of euro-denominated invoices paid in monthly instalments.
The document shows the full £1.3 billion was transferred last year via two invoices issued by the EU in April and September, with the April sum settled in four instalments from June to September and the September invoice paid in eight monthly instalments from October to May. Frank Furedi, executive director of the think tank MCC Brussels, said: “The fact that the UK is still paying £1.3 billion in 2025 – years after formally leaving the European Union – underlines how the Withdrawal Agreement locked Britain into a long tail of liabilities that few voters fully understood.”
The Treasury’s own figures show that between 2020 and the end of 2025, the UK paid a net £25.7 billion to Brussels. Table 3.A records gross payments of £42.2 billion over the period, offset by receipts, resulting in the £25.7 billion net outturn.
Table 3.B sets the overall Treasury point estimate for the entire financial settlement – including Article 50 extension costs – at £37.9 billion net.
The report confirms that these payments are managed through a rolling system of invoices and instalments stretching across the calendar year. The document explains the EU’s invoicing process and the use of daily exchange rates to convert euro liabilities into sterling.
The overwhelming majority of this money is not ring-fenced, meaning it flows directly into the EU’s general budget with limited transparency over how it is ultimately spent.
Only a specific portion – primarily related to UK pension liabilities (€333.9 million) and access to certain IT systems and databases (€1.4 million) – is treated as assigned revenue for specific purposes. The remainder enters the EU’s central funds as unassigned revenue.
Mr Furedi added: “These payments are not even straightforward: they are made through a rolling system of invoices and instalments stretching across the year, reinforcing the sense that Brexit has not delivered a clean financial break.
“Moreover, the overwhelming majority of this money is not ringfenced, meaning it flows directly into the EU’s general budget with limited transparency over how it is ultimately spent.”
The report also identifies separate liabilities outside the main settlement. An additional £481 million remains outstanding for the UK’s contribution to the European Development Fund.
Separate discussions continue over the EU’s demands for extra payments linked to the “Global Margin of Commitments”, with the Treasury noting ongoing negotiations under the Withdrawal Agreement’s governance structures.
Payments related to UK participation in programmes such as Horizon Europe and Erasmus+ are handled under separate arrangements and are not included in these figures.
Mr Furedi concluded: “As Keir Starmer pursues his much-vaunted ‘reset’ with the EU, this lingering financial entanglement raises serious questions about how much leverage the UK really has.
“Far from drawing a line under membership, the UK remains tied into a complex web of obligations and ongoing negotiations – from residual liabilities to potential additional demands – which risk deepening, rather than resolving, the ambiguities of the Brexit settlement.”
The Treasury document, the 45th in the series on the implementation of the settlement, stresses that all figures are based on actual transactions and current forecasts. It projects payments continuing until 2065, primarily for long-term pension liabilities.
Brexit Bombshell as Shocking Report Reveals UK Gave £1.3 Billion to EU Last Year
Britain’s relationship with the European Union has returned to the political spotlight following claims that the United Kingdom paid £1.3 billion to the bloc last year, prompting renewed questions about the financial consequences of Brexit and the future of Britain’s relationship with Brussels.
For supporters of Brexit, the reported figure raises an uncomfortable question: if leaving the European Union was intended to restore British sovereignty and give the country greater control over its finances, why does the UK continue to make substantial payments connected to the bloc? For those who favour closer cooperation with European partners, however, such payments may reflect specific agreements, shared programmes and financial obligations rather than evidence that Brexit has failed.
The crucial issue is understanding precisely what the reported £1.3 billion represents. Payments associated with European programmes, outstanding commitments made before Brexit and contributions under subsequent agreements are not necessarily the same thing. Without examining the original report and the relevant financial accounts, the figure should not automatically be interpreted as Britain’s total annual contribution to the EU.
Nevertheless, the controversy highlights a broader political argument that has never entirely disappeared. Brexit was presented as a historic opportunity to change Britain’s economic and political relationship with Europe. Years later, politicians continue to disagree over whether the country has secured the benefits promised by leaving, whether the costs have been underestimated and whether a closer relationship with the EU would serve Britain’s interests.
The latest claims are therefore likely to reignite debate among Brexit supporters, pro-European campaigners and voters who simply want to know whether the arrangements negotiated after departure represent good value for money.
What Does the £1.3 Billion Figure Actually Mean?
To understand the controversy, it is necessary to look at the financial arrangements agreed when Britain left the European Union.
The Withdrawal Agreement established a financial settlement covering obligations arising from the UK’s membership. These included outstanding commitments under the EU budget, certain liabilities and other financial arrangements that did not simply disappear when Britain formally left the bloc.
According to the UK Treasury’s European Union Finances Statement 2024, Britain paid approximately £1.1 billion in net liabilities under the financial settlement during 2024. That figure was equivalent to around €1.3 billion. The government also reported that cumulative net payments under the settlement had reached £25 billion by the end of 2024. <Cite refs={[“turn416627search0”]}/>
This distinction is crucial because the reported £1.3 billion figure may confuse euros with pounds. It also matters whether a report refers to gross payments, net payments after receipts, or payments under a particular agreement.
The financial settlement is not the same as an ordinary annual membership contribution. It reflects obligations negotiated as part of Britain’s departure, and the amounts can vary as liabilities are calculated, payments fall due and receipts are taken into account.
For Brexit supporters, however, the political question remains straightforward: leaving the EU did not mean every financial connection would end immediately.
Why Brexit Supporters Are Furious
For many people who voted to leave the European Union, financial independence was an important part of the Brexit promise.
The campaign to leave frequently argued that Britain should regain control over its money and decide how public funds were spent. Supporters hoped that ending regular membership contributions would create greater flexibility for domestic priorities, including the NHS, infrastructure and regional investment.
Discovering that the UK continues to make substantial payments connected to the EU can therefore provoke frustration, particularly among voters who expected a more immediate financial break.
Some may question whether the original political promises adequately explained the outstanding obligations that would remain after departure.
Others may argue that the payments were an unavoidable consequence of commitments made while Britain was still a member and should not be confused with the cost of maintaining membership today.
Both arguments underline the importance of transparency. Voters need clear information about what Britain pays, why it pays it, what it receives in return and when particular obligations are expected to end.
Without that information, financial figures can easily become ammunition in a political dispute rather than a useful explanation of the country’s finances.
The Government’s Challenge: Prove Brexit Is Delivering
The government faces the difficult task of explaining Britain’s continuing financial relationship with Europe while defending its broader approach to Brexit.
The central issue is whether the UK can secure economic opportunities through cooperation with European countries without recreating the financial and political obligations associated with EU membership.
Supporters of closer relations argue that cooperation can benefit British businesses, improve trade and support economic stability. They maintain that practical agreements with European partners should be judged on their merits rather than rejected simply because they involve payments.
Critics respond that every new agreement must be examined carefully to determine whether its financial costs are justified by its benefits.
This debate has become particularly important as Britain explores opportunities for closer cooperation in areas such as energy, research, trade and security.
A payment connected to a specific programme may provide access to benefits that would otherwise be unavailable. However, the public deserves an explanation of the expected return and the conditions attached to the agreement.
The government’s challenge is therefore not merely to explain why money continues to flow to European institutions. It must demonstrate that each arrangement serves a clear British interest.
Could the Payments Reopen the Brexit Debate?
Brexit remains one of the most consequential political decisions in modern British history. Although the UK formally left the European Union in January 2020, disagreements about its economic consequences and future relationship with Europe continue to influence national politics.
The reported financial figure could provide renewed opportunities for both sides of the argument.
Those who supported leaving may use it to demand a more decisive separation from European institutions. They could argue that Britain should avoid unnecessary financial commitments and prioritise domestic spending.
Supporters of closer European cooperation may respond that the existence of payments does not, by itself, prove Brexit has failed. They may point out that international agreements can involve financial obligations even when a country is not a member of the organisation concerned.
The more useful question is whether the overall relationship delivers value for money.
That requires examining trade performance, investment, productivity, public finances and the costs of operating under different regulatory arrangements. No single payment can provide a complete assessment of such a complicated economic and political decision.
Nevertheless, the symbolism is powerful. A decision promoted as an opportunity to regain financial control will inevitably attract scrutiny when substantial payments to European institutions continue.
What Nigel Farage and Reform UK Could Do With the Issue
For Nigel Farage and Reform UK, the controversy offers an opportunity to reinforce their longstanding argument that Britain’s political establishment has failed to deliver the full benefits promised by Brexit.
Farage has built his political identity around challenging established parties and demanding a tougher approach to national sovereignty. A headline highlighting payments to the EU fits naturally into a broader message about accountability, public spending and the need to put British interests first.
Reform UK could use the issue to demand greater disclosure of the financial terms attached to Britain’s post-Brexit agreements. It could also press ministers to explain which payments are legally required, which relate to specific programmes and which might be avoided through alternative arrangements.
Such demands could resonate with voters who want greater clarity about how taxpayers’ money is being used.
However, a credible response would require more than promising to stop payments. Any proposal to end or renegotiate an obligation would need to consider the legal agreement involved, the potential economic consequences and whether Britain would lose access to valuable cooperation in return.
The political opportunity is clear, but turning it into a workable policy would require detailed analysis.
The Bigger Question: Is Britain Getting Value for Money?
Ultimately, the most important issue is not simply whether Britain paid a particular amount to the European Union last year. It is whether the country’s financial arrangements with Europe are sensible, transparent and consistent with its national interests.
The government should explain the difference between historic liabilities, current programme contributions and any new payments agreed as part of closer cooperation.
It should also make clear which obligations are expected to decline over time and which depend on decisions that have yet to be made.
This would help voters distinguish between unavoidable commitments inherited from the Brexit settlement and discretionary agreements that future governments may be able to negotiate differently.
Parliament also has a role in scrutinising these arrangements and ensuring that public money is accounted for properly.
For taxpayers, clear reporting is essential. People should be able to understand why payments are made, what they achieve and how they fit into the government’s wider financial plans.
That transparency would help prevent individual figures from being presented without the context needed to understand their significance.
Conclusion: A Financial Bombshell With Major Political Consequences
The claim that Britain gave £1.3 billion to the European Union last year has the potential to reignite one of the country’s most enduring political arguments.
Official Treasury figures show that the UK continued to make substantial net payments under the Brexit financial settlement in 2024, including approximately £1.1 billion, equivalent to €1.3 billion. These payments arose from outstanding obligations under the Withdrawal Agreement rather than ordinary EU membership. <Cite refs={[“turn416627search0″,”turn416627search1”]}/>
For Brexit supporters, the figures raise questions about financial independence and whether the promises made during the referendum campaign have been fully realised. For those favouring closer cooperation, they demonstrate the importance of distinguishing historic liabilities from the potential benefits of future agreements.
Nigel Farage and Reform UK may see the controversy as another opportunity to challenge the political establishment and demand greater accountability over public spending.
However, the real test is whether Britain’s arrangements with Europe provide value for money and support the country’s long-term economic interests.
Brexit did not instantly eliminate every financial obligation associated with EU membership. The public debate should therefore focus on the precise nature of the payments, the legal commitments behind them and the benefits or costs they create.
For the government, the responsibility is clear: explain the figures accurately, publish transparent accounts and demonstrate that decisions about Britain’s relationship with Europe are being made in the interests of British taxpayers.
The Brexit debate is far from over. As long as substantial financial obligations remain and politicians continue to disagree about the country’s future relationship with Europe, questions about sovereignty, accountability and public spending will remain firmly on the political agenda.