Eurocrats’ pensions shape up to be flashpoint in Brexit talks
EU and London set for clash over liabilities running to several billion euros
The pensions of British Eurocrats are shaping up to be one of the most politically poisonous points in the UK’s Brexit talks, as the EU and London prepare to clash over liabilities running to several billion euros. Big staff unions in Brussels are already calling for a “League of Nations” style solution, which would see a post-Brexit Britain pay part of the EU’s €60bn worth of pension promises, just as the League’s members did when the organisation was dissolved after the second world war. The move sets the stage for a bruising political battle with London, which will be loath to remain on the hook for pensions that it views as too generous and the responsibility of EU institutions as the employers.
Pensions are one of many areas — from European Investment Bank projects to research funding — where complex joint liabilities with Britain will need to be unwound in Brexit talks. Failing to find a solution would put at risk pension payments to about 3,000 British officials who have worked in EU institutions since 1973. Senior officials on both sides acknowledge the issue could become one of the most charged of the negotiations.
Some senior EU officials predict the final compromise could involve Britain paying a lump sum to close its exposure, which would be used to create a standalone pension fund. “This could be horrible, ugly. I hope it won’t be,” said one. Brussels estimates its total pension liability to be about €60bn for all retired and current EU officials, with annual payments running at about €1.4bn. Some 1,730 retired Britons make up almost 8 per cent of the roughly 22,000 EU officials drawing pensions at present.
