There is consensus among the UK and its G7 partners that Russia should foot the bill for the destruction it has wrought in Ukraine – with recent World Bank estimates putting the cost of reconstruction at $411bn.

At last month’s Ukraine Recovery Conference in London, prime minister Rishi Sunak said Britain was working with its allies to explore “lawful routes” to use frozen Russian assets to rebuild Ukraine.

But Sunak’s government has so far stopped short of proposing the seizure of tens of billions of pounds’ worth of Russian assets currently frozen in UK financial institutions.

Experts have told openDemocracy there are legal ways to use these funds for Ukraine, and that the UK government is showing restraint where others are not, particularly over Russia’s immobilised state assets – which represent a far bigger pot of money than the frozen private riches of sanctioned oligarchs and officials.

Maria Nizzero, a research fellow at the Royal United Services Institute (RUSI) think tank, characterised the UK government’s stance as “very, very cautious”.

“They’ve made it very, very clear that anything that’s going to be done is going to be done when the war has ended,” Nizzero said.

Last month the UK government announced new legislation extending sanctions against Russia to promote compensation to Ukraine. UK sanctions will be kept in place, in line with G7 commitments, until Moscow pays damages to Kyiv.

“The clearest legal justification for confiscation is Russia’s failure to pay reparations,” said barrister Tetyana Nesterchuk of Fountain Court Chambers in London, who specialises in international commercial litigation from former Soviet countries.

“Russia is unlikely to pay those reparations voluntarily, so we’ve got to have some kind of back-up plan for Ukraine.”

Nesterchuk worked on the text of a private members’ bill sponsored by Labour MP Chris Bryant that says the UK government should legislate to seize Russian state assets – something it has not yet done. (Labour separately urged the government last week to table a bill in Parliament allowing those assets to be repurposed for Ukraine’s recovery.)

Nesterchuk explained that in her opinion existing sanctions legislation does not provide sufficient legal grounds for seizure of the assets and that new laws are needed.

The value and quantity of Russian state assets held in the UK remains unclear. The most recent data available comes from the Central Bank of Russia’s 2021 annual report and shows that, on 1 January 2022, UK-based financial institutions held 5.1% of Russia’s foreign reserves, amounting to around $31bn.

Planned legislation will force those holding these assets in the UK to disclose them to the Treasury. “I can’t believe it’s taken this long,” said Nesterchuk.

But even once identified, seizing the assets for use in Ukraine could prove tough. A legal doctrine called sovereign immunity prevents Russia (or any other state) from being taken to court in individual countries, including the UK.

Nesterchuk believes the UK government could later sidestep this issue by introducing legislation that permits seizure without needing to go through the courts – and that a legal justification based on Russia’s failure to pay damages to Ukraine could satisfy judges if Moscow takes a case to the International Court of Justice in The Hague.

“Once Russia knows that its funds are going to continue to be frozen until it pays reparations, the question becomes a mechanical one,” Nesterchuk said. “Is it going to pay those reparations out of its funds which are currently in Russia or is it going to pay [them] out of the funds that are currently frozen abroad?”

Experts also told openDemocracy that more could be done with frozen Russian assets for Ukraine’s immediate reconstruction needs.

Ukrainians have expressed concern that a Western-led reconstruction could see the country subjected to harsh neoliberal reforms at the expense of workers’ rights and public assets, particularly if the private sector is given any significant role.

But Timothy Ash, an emerging markets strategist at BlueBay Asset Management, believes companies may not actually want to play such a large part in financing the rebuilding of the country’s shattered economy, making the use of frozen Russian assets even more crucial.

Ash told openDemocracy: “I think [Western governments] are willing to accept that the Western taxpayer probably won’t [support the idea of paying to rebuild Ukraine through taxation] and are just blindly thinking that the private sector will do it. It won’t. And they need to recognise the reality that there is a financing gap.”

He added: “If you’re not going to use frozen Russian assets, how are you going to fund it?”

RUSI’s Maria Nizzero said that the UK government’s “very cautious approach” to confiscation was in “very stark difference” to other Western countries.

She pointed to a proposed EU windfall tax on the interest generated by €207bn worth of Russian central bank assets immobilised within the bloc. EU leaders backed the plans at a Brussels summit last Thursday. The European Commission said on 3 July that it is now discussing the plans.

Anders Ahnlid, a Swedish diplomat who chairs the EU’s working group on frozen Russian assets, told openDemocracy that the proposed tax is “likely to yield results” of up to €3bn a year.

“I think we have found that this windfall money is not owned by the Russian central bank and therefore it can be transferred to the EU budget and given to Ukraine for its reconstruction,” Ahnlid said.

But the diplomat added that some EU states were voicing legal concerns, and that the European Central Bank had “views”, reportedly fearing the move would dent confidence in the euro.

During a Commons debate last week, the UK’s Europe minister Leo Docherty said the government was considering something similar to the EU’s proposal for a windfall tax but called it “an idea, not a legally tested, viable route”.

What about oligarchs?

There is also the question of Russia’s fabulously wealthy oligarchs, and whether they might be made to pay.

According to Treasury figures issued in November 2022, the UK has frozen £18bn in funds held by or on behalf of sanctioned Russians (not including the value of frozen properties).

“I think it’s a mistake to focus on them if we want to talk about Ukraine reconstruction,” said RUSI’s Nizzero. “The only mechanisms that we have to confiscate private wealth is if this… is proven to be the proceeds of crime.”

But Kremlin-linked Russians have been sanctioned for supporting the war in Ukraine, not because of the criminal origins of their money.

Even in instances where their wealth might stem from corruption, historic or otherwise, experts told openDemocracy that UK law enforcement lacks the resources to properly investigate and justify seizure before the courts.

Transparency campaigners, though, are more optimistic about government plans to make sanctioned Russians disclose all their UK assets or risk losing them.

While the details remain unclear, Nizzero said that it is likely the government will criminalise non-disclosure as a form of sanctions evasion, potentially leading to “the confiscation of at least a tiny part of the bigger pot”.