The Rwandan government has formally launched legal action against the United Kingdom, claiming it is owed more than £100 million in unpaid funds following the cancellation of a controversial asylum agreement by Prime Minister Sir Keir Starmer.
Kigali has filed an international arbitration case at the Permanent Court of Arbitration (PCA) in The Hague, arguing that Britain breached the terms of the Migration and Economic Development Partnership, signed in 2022 under the previous Conservative government.
Under the deal, the UK agreed to transfer some asylum seekers who had arrived illegally in Britain to Rwanda, alongside substantial financial payments to support the programme.
Dispute centres on unpaid payments and treaty obligations
In a statement, the Rwandan government said it decided to pursue arbitration after what it described as the UK’s “intransigence” over outstanding obligations under the agreement.
Rwanda accuses Britain of failing to make payments totalling £100 million, made up of two instalments of £50 million each that were due in the 2025–26 and 2026–27 financial years. Kigali also claims the UK breached the treaty by publicly disclosing confidential financial terms and refusing to honour commitments to resettle vulnerable refugees currently hosted in Rwanda.
As part of the agreement, Britain had pledged to relocate a small number of refugees already living in Rwanda to the UK. The Home Office previously said this would involve “tens” of cases, particularly individuals with serious medical or humanitarian needs.
Rwanda argues that Britain has now made clear it has “no intention” of making further payments or fulfilling its refugee resettlement obligations.
Starmer government declares Rwanda scheme “dead and buried”
The asylum partnership became politically contentious almost from the start. After Labour won the 2024 general election, Prime Minister Keir Starmer announced that the Rwanda deportation plan was “dead and buried,” effectively ending the scheme before it was fully implemented.
Only four asylum seekers ever travelled voluntarily to Rwanda during the period the deal was in force.
The previous Conservative government spent an estimated £700 million on the policy, including £290 million already paid to Rwanda. Additional payments of £120 million were also contractually linked to the transfer of 300 asylum seekers — a threshold that was never reached.
In December 2024, the Home Office confirmed that a further £100 million would have fallen due had the treaty remained active.
Rwanda says UK failed to negotiate termination terms
According to Kigali, the UK asked in November 2024 for Rwanda to forgo the two £50 million payments in anticipation of terminating the agreement.
Rwanda says it was willing to accept this arrangement only if new financial terms were negotiated and formally agreed, something it claims never happened.
“Discussions between Rwanda and the United Kingdom did not ultimately take place, and the amounts remain due and payable under the treaty,” the Rwandan government said.
Britain later notified Rwanda of the termination of the agreement after Kigali had already issued a formal notice of arbitration. Rwanda says the treaty will officially cease to have legal effect on 16 March 2026.
UK government vows to fight the claim
The Home Office has rejected Rwanda’s position, insisting it will defend British taxpayers.
A spokesperson said the Rwanda policy had “wasted vast sums of taxpayer time and money” and confirmed the government would “robustly defend” its legal stance.
Downing Street has described the scheme as a “complete disaster,” arguing it failed to deter illegal Channel crossings, with more than 84,000 people arriving during the period the deal existed.
The government has also maintained that Rwanda is under no obligation to refund money already paid.
Arbitration process could take years
Under the treaty, disputes that cannot be resolved diplomatically must be referred to the Permanent Court of Arbitration, an international body that resolves disputes between states.
The PCA has the authority to issue binding rulings, though proceedings often take several years. The court has not yet announced a timetable for the case, which remains listed as pending.
Legal experts say the case could hinge on whether the UK lawfully terminated the treaty under international law.
Rwandan international law expert Jonathan Musangwa argues that Britain cannot rely solely on domestic court rulings — including the UK Supreme Court’s 2023 judgment that declared the scheme unlawful — to escape international obligations.
“A domestic judgment may prevent implementation internally, but it does not automatically terminate a treaty or erase obligations between states,” he said.
Political fallout continues in Britain
The dispute has reignited political tensions in the UK. Conservative shadow home secretary Chris Philp accused Labour of triggering the lawsuit by scrapping the scheme prematurely, warning that taxpayers now face a potentially massive compensation bill.
The Labour government insists it is instead focusing on new immigration reforms aimed at reducing illegal migration through increased enforcement and removals.
As the legal battle unfolds in The Hague, the case is shaping up to be one of the most significant international disputes arising from Britain’s post-Brexit immigration policy — with financial, diplomatic and political consequences still unfolding.
