Article 50 diplomat predicts 'one in three' chance of no Brexit deal

There could be a one in three chance that Brexit negotiations will end with no deal between the UK and the European Union, resulting in "serious economic disruption and a degree of legal chaos", the author of Article 50 has warned.

Lord Kerr also suggested that leaving the EU could result in a "decade of delay and disruption" for Britain, which would damage investment, economic growth and employment.

The former diplomat, who negotiated European deals for both Margaret Thatcher and John Major, made the comments as he considered a number of possible outcomes for the UK following the vote to leave in 2016

Lord Kerr, who has served as UK ambassador to both the EU and the US, warned if no agreement was reached on the terms of Brexit, and no extension to the talks was agreed, the UK would have to leave the EU anyway.

He said the possibility of this happening could be "as much as 25 per cent or maybe more", adding: "I think there may actually be a one in three chance of no deal."

Lord Kerr wrote Article 50 of the Lisbon Treaty, which Theresa May will trigger in March to start the UK's formal departure process.

During a lecture at Glasgow University, he told how he is "pretty confident" the UK's exit will not result in the break-up of the EU.

He warned that the financial negotiations about leaving would be "very nasty".

Reports have suggested the UK could be presented with a "divorce bill" by the European Commission which could be as much as £50 billion to £60 billion.

Lord Kerr said: "Article 50 is not about trade, it is about divorce. It's about paying the bills, dividing the property. The money negotiation is going to be a very nasty negotiation."

He went on to predict there will be "no serious negotiations before the autumn", adding he expects "this calendar year will be mainly spent in a furious battle about money".

Going on to outline some of the possible outcomes from Brexit, Lord Kerr said there was about a 25 per cent probability the UK will leave Europe in 2019 with an agreed Article 50 financial settlement , a "substantive framework" setting out future relationships and a "degree of progress on the trade negotiations Mrs May says she want".

There is about the same chance the UK will leave in 2019 but with only a "thin framework and not much progress made on trade", he said.

Another scenario is that Brexit talks could go "into extra-time", with an extension agreed to the two-year period for Article 50 negotiations. Lord Kerr said: "The probability is very low, probably about 10 per cent."

Another outcome he mooted was "no deal at all" with Britain and the EU in a "deadlock on money" and forced to go to the courts to try to resolve the situation.

This would mean "we leave anyway", he said, adding: "As Article 50 says, if there is no agreement and no extension, the departing country departs.

"So, out we go into serious economic disruption and a degree of legal chaos."

He also warned that talks with the dozens of nations the EU has trade agreements with would not be able to take place until the Brexit process has been completed, telling the audience: "We can expect, I'm afraid, a decade of delay and disruption with investment, economic growth and employment lower than they would have been."

A paper produced by Holyrood ministers arguing for either the UK, or Scotland on its own, to be able to remain in the single market was "rather impressive" Lord Kerr said.

He added this "serious and substantive white paper" from the Scottish Government, setting out proposals for mitigating the impact of Brexit, "seems to have been ignored" by the Westminster administration.

Press Association