Britain is prepared to discuss paying towards infrastructure projects in disadvantaged areas of the European Union in exchange for access to the EU's electricity market, according to Hamish Falconer, the cabinet minister leading renegotiations of the UK-EU relationship. Falconer told the Guardian that while the UK government has not accepted the principle of linking electricity trading rights to payments into the EU's so-called cohesion fund, both sides will explore the matter following this month's summit between the two sides.
Five European leaders welcomed Britain's interest in joining the European electricity market over the weekend but stated that the UK would need to contribute to the cohesion fund as a condition. The cohesion fund supports economic development in poorer regions across the bloc. UK officials have expressed reservations about the arrangement, concerned that British taxpayer money could be directed towards infrastructure projects in central and eastern Europe. Falconer acknowledged these concerns but indicated willingness to enter negotiations. 'We have not accepted that principle,' he said. 'I understand that that's what the European Union have asked for, but the UK government hasn't accepted. Again, this is something no doubt we will discuss.'
The electricity market discussions form part of broader efforts to deepen UK-EU ties. Prime Minister Andy Burnham has indicated interest in fostering a much closer relationship with the bloc, including the possibility of full membership in future. Falconer expressed hope that an upcoming EU-UK summit next week 'will go some real distance in undoing some of the harm that Brexit has done'. Negotiators are pursuing deals on food and drink, carbon emissions and youth mobility arrangements.
A separate sticking point concerns the EU's defence fund. Last year, negotiations over British entry into the EU's €150bn defence fund collapsed following disagreement over the UK's contribution. EU officials had suggested an entry fee of up to €6bn, significantly higher than the administrative fee the government had anticipated. Falconer expressed disappointment about the failed talks, saying 'I think it's a real shame that the UK was not part of that scheme' and expressing hope for future opportunities on more favourable terms.
On youth mobility, Falconer confirmed the UK plans to return to the Erasmus+ student exchange scheme next year, which Britain left under Boris Johnson's Brexit deal in 2020. The scheme will extend beyond universities to include schools and colleges. The Guardian previously reported that the UK was prepared to spend up to £450m annually to provide EU students with discounted university tuition fees if Brussels granted Britain access to the Made in Europe industrial programme. Falconer said discussions around the youth mobility scheme remained ongoing.
For British savers, borrowers and businesses, any contributions to EU infrastructure funds would mean UK tax revenues could be allocated to EU projects, while electricity market access could influence future energy prices and supply arrangements in Britain.