14/06/2005

Blair rejects proposed rebate freeze

A formal plan to freeze Britain’s £3 billion European Union rebate has been firmly rejected by Prime Minister Tony Blair.

Mr Blair rejected the proposal, which was put forward during his meeting with Luxembourg Prime Minister and current EU President Jean-Claude Juncker this morning.

A Downing Street spokesperson said the proposal, which would have frozen the rebate between 2007-2013, would have cost the UK between 25 billion and 30 billion euros (£16 billion - £20 billion). Mr Blair’s spokesperson said: “The position is, today was the first real head-to-head discussion of the actual figures. What the presidency are proposing is a freeze of the rebate. There seems to be agreement between us and the presidency that between 2007 and 2013 the cumulative cost of that to us would be losing out 25 – 30 billion euros. We would still be paying more than one third more therefore in that period than France, for instance. That is not acceptable to us and we have told the presidency so.”

The debate over Britain’s EU rebate is set to continue as Mr Blair meets with French President Jacques Chirac later today.

The row over Britain’s EU rebate erupted last week, when Mr 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.

Margaret Thatcher won Britain’s rebate in the 1980s. Britain receives little from the CAP, which currently grants £7 billion per year in agricultural subsidies to France.

However, Peter Mandelson, who was regarded as a close ally of Mr Blair and now holds the post of Britain’s EU Trade Commissioner, said that Britain’s rebate needed to be reformed. He also accused the government of sounding “neo-Thatcherite” in dealing with the matter.

The EU budget will be discussed at the European Summit, which takes place in Brussels on June 16 and 17. The fate of the European constitution, which recently suffered humiliating defeats in public referendums in both France and the Netherlands, will also be discussed.

(KMcA/MB)






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