UK-EU Defence Talks Collapse Over €6.5bn SAFE Fee Demand; UK Firms Lose Preferential Access

Post-Brexit negotiations over Britain’s participation in the European Union’s €150bn (£130bn) Security Action for Europe (SAFE) defence programme collapsed after talks in Brussels failed to bridge a wide gap over how much the UK should pay for full access.

Brussels sought a contribution of up to €6.5bn (£5.7bn), while the UK offered a maximum of €300m (£262m). Paying the larger sum would have given British defence firms preferential access to bid for projects that could represent up to half of SAFE’s funding pool. With negotiators unable to agree before the end‑of‑November deadline, talks were suspended without a deal.

“Negotiations were carried out 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,” said Nick Thomas‑Symonds, minister for European Union relations.

As a result of the breakdown, UK companies will not obtain preferential terms in SAFE’s first funding round. They will, however, still be eligible to compete under third‑country conditions, which the Commission says allow participation in up to 35% of procurements.

A European Commission spokesman said negotiators had engaged constructively and reiterated that SAFE is designed to be open to non‑EU partners. He expressed hope that a future compromise could be found in time for the programme’s second round of funding. Brussels is also continuing parallel SAFE discussions with Canada.

Negotiators pointed to a number of sticking points behind the impasse. In addition to the raw difference in proposed contributions, some member states — notably France — pushed for terms that would preserve the most favourable positions for EU firms, complicating efforts to reach a compromise.

The collapse on SAFE comes amid wider continuing Reset talks agreed in May, which included a UK‑EU defence pact and a separate 12‑year fishing deal. London and Brussels say they are still making progress on other elements of the Reset, including regulatory alignment, talks on plant and animal health rules, the Erasmus+ exchange scheme and possible UK re‑entry to the EU Emissions Trading Scheme.

“While it is disappointing that we have not been able to conclude discussions on UK participation in the first round of SAFE, the UK defence industry will still be able to participate in projects through SAFE on third country terms,” Mr Thomas‑Symonds said.

Critics warned that failing to secure full access is a setback for the UK defence sector. Mark Francois, the shadow Armed Forces minister, said the proposed contribution was unaffordable given domestic defence savings, while Sir Nick Harvey, former Armed Forces minister, described the outcome as a major blow to the industry.

Supporters of close UK‑EU defence cooperation urged negotiators to return to the table quickly. Naomi Smith, chief executive of Best for Britain, said the strategic threat posed by Russia and the importance of coordinating European defence capacity meant that political differences should not block practical security cooperation.

Negotiators from both sides say goodwill remains and that work will continue to try to reach an agreement ahead of the second SAFE funding round. For now, British firms will continue to pursue opportunities under third‑country rules while wider Reset discussions proceed.