Keir Starmer’s attempt to reset ties with the EU has suffered a major setback after Britain’s talks to join the EU’s major €150bn (£131bn) defense fund failed.
Britain had been pushing to join the EU’s Security Action for Europe (SAFE) fund, a low-interest loan scheme that is part of an EU drive to boost defense spending by €800 billion and rearmament the continent in response to the growing threat from Russia and Donald Trump’s cooling of relations between the US and the EU.
Entry into the scheme would have enabled the British government to secure a larger role for its defense firms. In September, France proposed a limit on the value of UK-made military components in the fund.
The UK and EU were expected to sign a technical agreement on SAFE after London established an administrative fee. After months of wrangling, and just days before a November 30 deadline for a deal, sources said the two sides remain “far apart” over the financial contribution Britain should make, Bloomberg reports.
EU officials have suggested an entry fee of up to €6 billion, far more than the administrative fee the government would pay. Peter Ricketts, the veteran former diplomat who chairs the European Affairs Committee in the House of Lords, described a rumored €6.5bn fee as “so massive that it suggests some EU members do not want the UK in the scheme”.
The minister for EU relations, Nick Thomas-Symonds, said it was “disappointing” that negotiations had failed, but he stressed that the UK defense industry would still be able to participate in projects through SAFE on third country terms.
“While it is disappointing that we have not been able to conclude discussions on UK participation in the first round of SAFE, the UK defense industry will still be able to participate in projects through SAFE on third country terms.
“The negotiations were conducted in good faith, but our position was always clear: we will only sign agreements that are in the national interest and provide value for money.”
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The door to greater UK involvement appeared to be open in May when Starmer and the President of the European Commission, Ursula von der Leyen, signed the EU-UK Security and Defense Partnership. Without this agreement, the UK could never supply more than 35% of the value of components of any SECURE-funded project.
As recently as last week, the Prime Minister expressed confidence that quiet diplomacy would result in an agreement, telling reporters traveling with him to the G20 summit in South Africa: “Negotiations are going on as normal and they will continue.”
He further said, “I hope we can find an acceptable solution, but I strongly feel that these things are better done quietly through diplomacy than exchanging views through the media.”
But soon after, Defense Secretary John Healey said Britain was prepared to leave, prompting talks to turn rocky, telling the i newspaper that Britain was unwilling to sign “at any cost”.
Thomas-Symonds on Friday sought to downplay the collapse of the talks, saying: “From leading the Coalition of the Willingness to Ukraine to strengthening our relationships with allies, the UK is leading the way on European security in the face of growing threats and is committed to cooperating with our allies and partners. In the last year alone, we have struck defense deals across Europe and we will continue this close co-operation.”
He said the UK and EU were “making strong progress on the historic UK-EU May agreement that supports jobs, bills and borders”.
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