Sir Keir Starmer has come under fire at PMQs after Mauritius said the UK had agreed to change payment terms in its deal to hand it control of the Chagos Islands.
It comes after Mauritian PM Navin Ramgoolam claimed the UK had now agreed to front-load the payments and change how they are calculated.
The Conservative and Reform UK leaders both attacked Sir Keir over the cost of the deal, at a time when winter fuel payments to pensioners are being scaled back.
But Sir Keir insisted it was required to secure the future of a UK-US military airbase on the largest island, Diego Garcia, which the UK is due to keep on a 99-year lease.
The plan to cede sovereignty of the archipelago, known officially as the British Indian Ocean Territory, was announced last October after a deal was reached with former Mauritian leader Pravind Jugnauth.
But he was swept from power in a general election a month later, and Ramgoolam, his replacement, has criticised the initial draft.
The agreement has also been mired in uncertainty after Donald Trump’s re-election as US president, given several US Republicans have argued it could deliver a potential security boost to China.
Mauritius says it was ready to sign a deal last month – but the UK asked to press the pause button to allow Trump to examine it first.
The UK government has never confirmed the estimated cost of payments under the deal, but press reports have put the figure at £9bn.
Speaking in the Mauritian Parliament on Tuesday, Ramgoolam said payments, due to be made in dollars, would now be subject to a variable rather than fixed exchange rate, arguing the previous deal was not “inflation-proof”.
“What’s the point of getting money and then having half of it at the end?” he added.
Both the UK and Mauritian government have moved to deny reports this meant the effective cost of the deal had jumped from £9bn to £18bn, although neither side has specified an alternative figure.
But Tory leader Kemi Badenoch seized on the reports as she faced Sir Keir at Prime Minister’s Questions, telling MPs: “Yesterday, we heard the government offered £18bn for Mauritius to take our territory in the Chagos Islands.”
Referencing July’s decision to cut winter fuel payments, a pension top-up, she added: “He’s freezing pensioners, while shovelling money to Mauritius.”
In response, Sir Keir said the future of the Diego Garcia base had been “thrown into doubt” by international rulings.
The Tories and Reform UK have rejected this, arguing a binding judgement on the issue has not been made by international judges.
But the prime minister said that the base would be unable to “operate in practical terms as it should” unless the UK agreed to cede sovereignty.
