The European Union's credit rating will be damaged if Britain refuses to pay a Brexit divorce bill, one of the World's biggest ratings agencies has warned.

Standard & Poor’s said the European Union's AA credit rating "could come under pressure" if the UK refuses to meet its "financial obligations".

The European Union is demanding the UK pay a bill in the region of £50billion as it leaves the bloc to cover the cost of outstanding pension contributions and financial liabilities.

However, while the Government has said it will meet its obligations it has warned Britain will pay “nothing like’’ the amount demanded by the EU.