• Toby Irwin

Brexit and COVID-19: Challenges to the EU Budget

Much debate overt he last five years in the UK centred around the contributions that London was paying into the EU budget, and how it was disproportionate. In this sense, the UK contributed more than it received back: this of course was a major argument in the vote leave campaign. While it is true that other factors are at play, like the access to the single market that said contribution provided, it appears clear now that amidst the onset of a new recession that Britain was correct to leave. This assertion is based on looking at in-fighting over the new budget in Brussels.

In the wake of the UK's departure the EU lost one of its major net contributors. In 2018, the UK was the second largest contributor to the EU budget at 9,770 million euros. Germany was the highest contributor at 17,213. The next following the UK was France, Italy and The Netherlands at 7,442, 6,695 and 4,877 million euros respectively. Following the UK's departure there are only nine net contributors to the budget, and 18 states that are net beneficiaries. At the greatest extreme, Poland receives a net 11,632 million euros. Not only do future budgets have to accommodate the departure of the UK but also have to factor in the fact that this data was retrieved in 2018. With a crippling recession arriving at our doors, one is certainly tempted to say that the UK's timing for departure could not have been more impeccable. Hampered by excruciating economic recovery, one would not likely be the first to want to have to foot the bill for economic recoveries abroad.

What doesn't help the EU, and indeed is a underlying problem for the bloc since its inception, is the realistic split in policy preference since, after all, states will favour their own interests over that of their allies or greater political entity/bloc. One group of nations favour that the budget do not shrink following Brexit and the pandemic. Unsurprisingly, these include the net beneficiaries to the budget such as Poland, Portugal and Spain. On the other hand, wealthier states such as Austria, the Netherlands and Sweden would rather see the budget cut. Following recent developments such as the COVID-19 relief fund, coming in at over 1 trillion euros, the more frugal member states will be disappointed at the ramping up of spending and their inescapable dues to be paid therein. Meanwhile for the UK, officials in Whitehall are wisely washing their hands clean of any funding commitments during the transition period. According to one source, around 300 million euros is being asked by Brussels, and only around a third being believed to be paid by London. https://www.politico.eu/article/uk-and-eu-clash-over-british-share-of-covid-fund/


At the time of writing, Toby Irwin is a third year student at the University of St Andrews. He is studying International Relations. Areas that interest him the most are UK foreign policy and the defence/aerospace industry.