Negotiations between the United Kingdom and European Union over British participation in a major defence fund have collapsed, dealing a significant blow to Prime Minister Keir Starmer's efforts to rebuild relations with the bloc.
Funding Dispute Halts Defence Cooperation
The British government confirmed on Friday that talks regarding UK access to the EU's €150 billion Security Action for Europe (SAFE) programme had concluded without agreement. The breakdown occurred primarily over financial contributions, with European officials demanding a higher participation fee than the UK was prepared to pay.
This development represents a setback for Starmer's administration, which had made improving ties with the EU a cornerstone of its foreign policy. The Prime Minister, elected last year, had pledged to repair relations strained by Britain's contentious departure from the bloc in 2020.
Third-Country Status Limits British Industry
While the UK defence sector will still be able to engage with SAFE projects, it will now do so under third-country terms, which restrict participation to a maximum of 35% of any contract value. British negotiators had been seeking more favourable terms that would have allowed greater involvement for UK defence firms.
The SAFE programme was established to provide EU-backed loans for military equipment procurement, primarily to support Ukraine and enhance European defence capabilities. UK companies would have benefited from access to cheaper financing through the scheme.
Government Maintains National Interest Stance
British EU Relations Minister Nick Thomas-Symonds stated that while negotiations were conducted "in good faith," the government's position remained clear. "We will only sign agreements that are in the national interest and provide value for money," he affirmed on Friday.
Thomas-Symonds noted that despite the disappointment, progress continues on other aspects of the broader UK-EU agreement reached in May, including cooperation on energy and food and drink trade.
EU spokesperson Thomas Regnier emphasised that the bloc remains committed to its security partnership with Britain and pointed out that SAFE remains open to UK participation by default under the existing third-country arrangement.
