Brussels agreed a €5billion (£4.3billion) compensation package last year, formally known as the Brexit Adjustment Reserve. But the allocation of funds to member states has caused infighting between the EU27, with Ireland at loggerheads with France over how the money will be fairly split up.
Ireland is determined to secure almost €1billion in EU compensation, but France is attempting to reduce the country’s share.
French President Emmanuel Macron is devising a way to cut Ireland’s mammoth share of the pot, and his government has proposed a different “allocation key” that would give extra money to larger states such as France, Spain and Italy, the Irish Times reports.
If France was successful in changing the allocation, Ireland would lose €200million (£172.3million), according to calculations by Belgian MEP Pascal Arimont, the European Parliament’s rapporteur on the Brexit Adjustment Reserve.
Over a dozen member states would also be affected by the change, including the Netherlands, Belgium and Denmark.
The EU’s Brexit Adjustment Fund is to help member states cover expenditure to counter adverse consequences of the UK’s exit from the bloc over a period of 30 months.
The money will be divided up over the expected impact on economies.
An initial breakdown was agreed last December, but has yet to be formally signed off.
Ireland is due to get a quarter of the funds, followed by the Netherlands, Germany and France.
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One EU diplomat told the Irish Times: “Ireland is hardest hit by the consequences of Brexit.
“The proposal by the Commission took this into account.
“Efforts by Paris to change the allocation criteria would result in cuts for Ireland and more money for France.
“This doesn’t really make for a nice picture.”
Ireland’s Minister for Agriculture, Food and the Marine has warned the fishing industry is in desperate need of monetary support and cannot see its funds cut.
Charlie McConalogue said the sector is recognised as having borne “the most severe impact of the final Brexit deal”, and is set to receive lions share of the EU’s compensation fund.