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European Union's chief Brexit negotiator Michel Barnier attends the Berlin Security Conference on European Security and Defence in Berlin, Germany, November 29, 2017. REUTERS/Hannibal Hanschke(reuters_tickers)
By Alastair Macdonald and Jan Strupczewski
BRUSSELS (Reuters) - The EU has not yet reached a deal with Britain over the "Brexit bill", EU officials said on Tuesday, adding that some in Brussels were worried that progress on a cash settlement masked differences over other issues.
"We are not there yet," the European Commission's Brexit negotiator Michel Barnier told Reuters in Berlin when asked about British newspaper reports that his team had broadly accepted an offer in the order of 50 billion euros (£45 billion), 10 billion short of EU estimates.
Prime Minister Theresa May's spokesman dismissed that as "speculation", although many EU officials assume the reports were based in part on leaks from her own government.
Phil Hogan, Ireland's member of the Commission, said Britain had "brought forward proposals that go very close towards meeting the requirements of the EU-27 member states".
Britain wants to start negotiations on the trade terms that will be put in place once it leaves the EU in 2019, but Brussels has demanded it first resolve three issues: settling its bill, guaranteeing the rights of expatriates and explaining how the EU-UK land border will operate on the island of Ireland.
Work was continuing on all three issues, Barnier said, and he hoped to be able to tell EU leaders at a summit in two weeks that "sufficient progress" had been made that they could launch negotiations on a future trade pact.
May has been given an "absolute deadline" of Monday, when she will meet Barnier and Commission President Jean-Claude Juncker in Brussels, to deliver offers in all three areas so that EU leaders can give approval at the Dec. 14-15 summit.
Several EU diplomats told Reuters Britain had given a verbal commitment in recent days to pay a share of EU budget spending on pensions and undisbursed commitments after it leaves.
"Deal or settlement are not the words I would use," said one envoy, warning that a collapse in talks was still possible.
"The UK is moving," said another. "We finally, in the 11th hour, seem to have some traction and positive exchanges in the financial talks. But we're still going through the financial issues line by line to explore potential movement and space."
Foreign Secretary Boris Johnson, a leading Brexit campaigner who earlier this year said Brussels could "go whistle" for such a big sum, told Reuters in Ivory Coast that he hoped Britain's offer would "get the ship off the rocks" and launch trade talks.
But some EU governments are concerned that London may push back harder on the other two issues. Brussels wants the EU court to have sway over the rights in Britain of EU residents and wants to hear London's plans to avoid a hard customs border with EU member Ireland that could disrupt peace in Northern Ireland.
Guy Verhofstadt, point man for the European Parliament on a Brexit treaty which the legislature must ratify, wrote to Barnier to complain that negotiations on guaranteeing citizens' rights had stalled and that some progress had even reversed.
A third EU diplomat said issues involving "sovereignty" over citizens' rights and the border now seemed harder to crack than a month ago. He said: "Where we now seem to be moving ahead on money, other issues are proving more difficult than previously."
There was concern, he added, that Britain was "trying to sideline Irish concerns by moving on the money", saying a split on this could still scupper any deal on trade talks next month.
Irish Prime Minister Leo Varadkar told parliament in Dublin: "Progress is being made but not that is sufficient ... Things are changing on a daily basis and are rapidly evolving."
British and EU sources played down reports that negotiators had discussed hard numbers on the settlement. Both sides have always said that a final figure will depend on future variables and that their initial interest was agreeing a "methodology".
Sources in the British government, which wants any offer on its part to unlock a simultaneous pledge from Brussels of opening trade talks in the new year, said it had not offered up any numbers to the EU, only commitments that will be covered.
Criticism among hardline Brexit supporters of such payments has been somewhat more muted in recent weeks and British media reported that May had won backing from her cabinet to pay more.
Nigel Farage, whose UK Independence Party had a big role in forcing last year's Brexit referendum, said paying the bill was a "complete sell-out" and urged May to walk away.
"It's an eyewatering sum if it's 55 billion," said Andrew Bridgen, a lawmaker from May's Conservative party who, unlike the prime minister, campaigned for Brexit in the referendum. "But as we know nothing is agreed until everything is agreed.
"It depends on what we get for it in terms of a trade deal."
EU officials say Brussels is willing to work with May to massage the figures -- which in the end depend on future developments -- in order to help her win support at home.
(Additional reporting by Elizabeth Piper and Guy Faulconbridge in London and Andrea Shalal and Reinhard Becker in Berlin and Joe Bavier in Abidjan; Writing by Alastair Macdonald; Editing by Ralph Boulton)