Britain's fight over EU budget as Brussels seeks rise

 
UK PM David Cameron in Brussels. File photo Forging a deal on 22 November will be tough for David Cameron

Britain is not alone in seeking to rein in the EU budget. It has allies.

Plenty of other countries agree that the EU cannot ask for austerity on the one hand, whilst not applying the same demands to itself.

No other country, however, takes such a hardline position as the UK.

The EU Commission wants a 5% increase in the seven-year budget. That would increase it to over 1tn euros (£830bn; $1.3tn).

The Germans want to limit the budget to 1% of the bloc's GDP. That would be over 100bn euros less than the Commission wants.

The British want a freeze in EU spending, allowing for inflation. That would produce a budget about 70bn euros less than the Germans.

Others have their objections. The Swedes believe the priorities are wrong: too much money is still going on agriculture.

The Poles fear that a budget freeze will reduce the funds they receive from the cohesion funds - EU money that helps the poorest regions across the 27-nation bloc.

EU draft budget for 2013

  • Total - 137.9bn euros
  • Cohesion (spending on Europe's poorer regions) - 49bn
  • Agricultural support - 44.1bn
  • Administration - 8.5bn

There are groups, like the Socialists in the European Parliament, who are warning against the budget becoming a victim of domestic political infighting.

No other member state would support a reduction in spending. The Commission says cutting its proposed increase would damage growth.

Forging an agreement on 22 November will be very difficult. Extra food has been ordered in case the summit extends into the weekend.

There has even been consideration of whether to postpone the meeting altogether.

British 'exceptionalism'

Much will turn on talks next week between German Chancellor Angela Merkel and David Cameron.

The Germans will be looking for compromise. The fear in Berlin is that the British have left themselves little room to manoeuvre in saying - as George Osborne did today - "we will veto any deal not good for British tax-payers".

That plays badly in Europe. The culture is built around compromise and deal-making.

The mood in Europe in recent months has turned against Britain.

On a visit to Berlin this week, I was left in no doubt that the German government would prefer the UK to remain at the heart of Europe. There is not the inclination, however, to make too many concessions or to pander to what is called British exceptionalism.

What they will not accept is that Britain either obstructs moves aimed at solving the eurozone crisis or disrupts EU business.

The UK proudly says it has the toughest negotiating stance of any EU state, but if it is to avoid being isolated it will have to forge alliances - and that usually involves horse-trading.

 
Gavin Hewitt, Europe editor Article written by Gavin Hewitt Gavin Hewitt Europe editor

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  • rate this
    +1

    Comment number 289.

    #286 MH

    -- The Feudal system is in danger.

    --that´s a big part of it.

    --on the other BBC blogs, some see through the deliberate propaganda of the UK government and some of their ´elite´ UK media.

    It is apparent that kane (and some others) have no idea how low the UK is thought of in Europe --the UK and Greece are now being mentioned in the same breath.

  • rate this
    +2

    Comment number 288.

    276 Bumstead

    "What possible benefit is expansion when the EU is in a severe financial crisis? Will Croatia, Serbia etc be huge net contributors?"

    The EU is the largest economy in the world and the largest exporter.
    Huge trading blocs are the future and we must expand and keep up.

    They will eventually contribute and the present world recession can't be allowed to stand in the way.

  • Comment number 287.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • rate this
    +2

    Comment number 286.

    277 QOT

    "Why should the Brazilians go to the UK ?

    Good question. They will be very wary after one of their citizens was shot in the head eight times by our police mistaking him for a bomber.

    Perhaps this latest EU row is being engineered to make England leave and become the 51st US state and we Scots will vote for independence and become an EU member in our own right.

  • rate this
    +1

    Comment number 285.

    #281 kane

    -- and how can ´ease of doing business´be any good to the Brazilians --when the UK is OUT of the EU ?

    -- stop trying to ´Greek´ us !

    --or don´t you mean ´shot in the head´--which you would be requesting the Brazilians to do.

 

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