17 November 2004

Search all issues

powered by FreeFind

Send Your Feedback!

Brown clashes with EU ministers over UK's budget rebate

UK Chancellor of the Exchequer Gordon Brown sought to counter calls from Germany and the Netherlands to cut Britain's annual rebate from the European Union budget, saying current proposals are premature and the rebate remains fully justified.
The European Commission, the EU's executive arm, proposes to trim the rebate, worth 5.2 billion euros in 2003, so that other EU contributors such as the Netherlands and Germany can also get refunds.
“The rebate has been, is and will remain fully justified,” Brown told reporters today following meetings with other European finance ministers in Brussels. “We receive the lowest receipts per head or as a share of national income of any country.”
Demanding that “I want my money back,” former British Prime Minister Margaret Thatcher won the rebate in 1984 by arguing that Britain gets a relatively small share of EU farm subsidies and regional aid. The Netherlands and Germany, backed by the commission, are now insisting on a similar deal for other net payers. Brown insisted that the commission trim its spending ceiling to no more than 1 percent of gross domestic product and called proposals to boost the EU's budget by 35 percent between 2007 and 2013 “unrealistic and implausible.”
The commission has proposed a “correction mechanism” in which the British rebate would be reduced so that some of that other net contributing countries get a share of the money.
“We had quite some difference of opinions in the room,” said Dutch Finance Minister Gerrit Zalm. “Some countries are very much in favour, some are very much against, and there's a middle group that wants to consider it.”
Germany, the biggest contributor to the EU's 100 billion euro annual budget, said payments should be based on per-capita GDP. Germany contributed 7.7 billion euros to the budget in 2003, or 0.36 percent of gross national income. The Netherlands paid 1.9 billion, or 0.43 percent, while the UK paid 2.8 billion euros or 0.16 percent.
“I made it clear that the limits of what Germany can bear have been reached,” said Finance Minister Hans Eichel. “We need a correction mechanism. We can't accept that we share the third highest per-capita GDP contributions.”

Copyright © Newsworks Ltd. Malta.
Editor: Saviour Balzan
The Malta Financial & Business Times, Newsworks Ltd, Vjal ir-Rihan, San Gwann
Tel: (356) 21382741-3, 21382745-6 | Fax: (356) 21385075 | E-mail