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Rwanda drags the UK to the Permanent Court of Arbitration, seeking £100 million in unpaid fees from the scrapped asylum deal, creating a major diplomatic headache for Keir Starmer.

The diplomatic ghost of the Conservative Party’s flagship migration policy has returned to haunt Prime Minister Sir Keir Starmer. The Rwandan government has formally launched legal action against the United Kingdom, demanding £100 million (KES 17.6 billion) in outstanding payments from the scrapped asylum deportation deal.
In a move that escalates the fallout from the cancelled treaty, Kigali has filed a case with the Permanent Court of Arbitration in the Netherlands. Their argument is simple: a contract is a contract. The UK signed a deal to pay Rwanda for hosting asylum seekers, and while the migrants never arrived, the infrastructure was built, the preparations were made, and the bills are due.
The deal, a brainchild of the Boris Johnson era and championed by Rishi Sunak, was axed by Starmer immediately after his 2024 election victory, with the Labour leader declaring the scheme "dead and buried." However, the financial burial is proving difficult. The UK had already sunk £290 million into the project. Rwanda argues that the remaining £220 million schedule included payments that are legally binding regardless of the policy U-turn.
The current claim focuses on a £50 million tranche for the 2025-2026 financial year and another £50 million for 2026-2027. "The UK has failed to honour commitments made in a sovereign treaty," a Rwandan government spokesperson stated. "We acted in good faith. We cannot be left holding the bag for British political volatility."
The Home Office has dug in its heels. A spokesperson retorted, "The previous government’s Rwanda policy wasted vast sums of taxpayer time and money. We will robustly defend our position to protect British taxpayers." The UK government’s legal team is expected to argue that the contract contained exit clauses that nullify future payments once the deal was terminated.
This lawsuit places the UK in an awkward position on the world stage. It pits a G7 nation against a key African partner in an international court, reinforcing the narrative that the West is quick to sign deals and quicker to abandon them when domestic politics shift. For Rwanda, this is about more than money; it is about reputation. President Paul Kagame’s administration invested significant political capital in the deal, facing down global criticism. They are not willing to walk away empty-handed.
With only four volunteers ever sent to Kigali under the scheme, the Rwanda plan goes down as one of the most expensive non-events in British political history. Now, the lawyers will decide the final price of the failure.
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