Britain will have to pay into the EU budget up until 2020 if it wants Europe to grant the UK reasonable terms on a Brexit transition deal, senior sources in Whitehall have told The Telegraph.

The idea, which is being actively discussed by British Brexit negotiators, would require a softening of British negotiation red lines in order to buy leverage and political goodwill in talks with the EU over a future trade deal.

Britain’s departure from the EU will leave a €10bn black hole in Europe’s finances which is causing significant anxiety in chancelleries across Europe, including in Berlin, which fears it will have to pick up the bill for any shortfall.

The immediate headache for Europe will be healing the gap between Britain’s departure in March 2019 and the end of the current seven-year budget framework which ends in 2020. British contributions to healing that gap could cost some €17bn euros.

“Payments up to the end of this MFF [Multi-annual financial framework] is something that we could put on the table which would help them fix a big short-term problem in their budgets,” said the source with firsthand knowledge of the UK pre-negotiation deliberations.