13/06/2005

Blair to remain “firm” EU rebate

Prime Minister Tony Blair has said that he will be “diplomatic but firm” with European leaders over the issue of the UK’s European Union rebate.

The Prime Minister, who was in Moscow for a meeting with Russian President Vladimir Putin, was speaking ahead of the forthcoming European summit, which takes place in Brussels on June 16 and 17.

The issue of the European constitution, which suffered humiliating defeats in public referendums in both France and the Netherlands, as well as the EU budget for 2007- 2013, are set to be the main topics of discussion at the summit.

Mr Blair said: “The context for this discussion is one in which two countries have now voted against the European constitution. Why? Because people in Europe did not feel that sufficient attention was being paid to their concerns about Europe and its future. When we come to debate the future financing of the European Union, let us bear that in mind.”

The row over Britain’s £3 billion EU rebate erupted last week, when French President Jacques Chirac called for Britain to accept a reduced rebate from the European Union as a “gesture of solidarity” with other EU nations. However, last week Mr Blair said he was not prepared to accept a reduction in Britain’s rebate, unless there was a debate about all European funding.

Foreign Secretary Jack Straw earlier condemned the EU budget, saying it was “as wasteful as it was unfair”.

Mr Straw, who was attending a meeting of foreign ministers in Luxembourg, said that Britain’s rebate was “not the issue” and said that the budget was “fundamentally distorted”. He said: “The proposed budget is not fit for purpose. It will fail to deliver the jobs and economic growth needed in Europe.”

The main problem for the government is Common Agricultural Policy (CAP), which currently grants £7 billion per year in agricultural subsidies to France. Last week, Chancellor Gordon Brown warned that the rebate was “not up for negotiation” and that the UK was prepared to use its veto if necessary.

The British stance has been heavily criticised by the French. France’s European minister, Catherine Colonna, said that Britain’s rebate, which was secured by Margaret Thatcher in the 1980’s, “defies EU logic and undermines EU solidarity”.

Other European leaders have urged Britain to compromise on the rebate. German Chancellor Gerhard Schroeder said that it would not be possible to reach a deal on the EU budget without a compromise by the British government.

President of the EU Commission, Jose Manuel Barroso, said: “We are no longer where we were 20 years ago. Britain is much more rich. There are ten new countries that are poorer and it would not be fair for them to support proportionally more of the burden than Britain.”

Mr Blair is due to meet with Mr Schroeder in Berlin this evening and with Mr Chirac in Paris tomorrow.

(KMcA)




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