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Friday, November 07, 2014

The £1.7bn question (Part II) - What are other EU finance ministers saying?

Here's a round-up of comments from other EU finance ministers about the UK's £1.7bn EU budget surcharge and the deal struck at today's meeting. This being EU budget negotiations, everyone is claiming either 'nothing to see here' or victory. Apart from the Dutch, who are getting a pretty raw deal.

We've given our take on the deal in this blog post: when all is said and done, the UK will pay £850 million. The question is whether the rebate the UK gets from the EU budget always applied to the £1.7 billion, and whether, therefore, George Osborne is basically engaging in accounting manoeuvres.

Remember, due to the way the UK's rebate from the EU budget is structured, everyone is basically paying for it, so it's not in anyone else's interest to ever talk it up.

Irish Finance Minister Michael Noonan said,
“My understanding is that the UK will pay the whole amount but there will be no penalties attached or interest rate on that.”
Spain's Luis de Guindos argued,
“No-one has put into question the [European] Commission’s figures…as perfectly valid. Basically, what we agreed on is the possibility of a delay in payments.” 
Dutch Finance Minister Jeroen Dijsselbloem stressed,
“The UK has...a rebate, which they have had for a very long time and of course this mechanism of rebate will also apply on the new contribution. So it's not as if the British have been given a discount today. The old mechanism of the rebate will also apply on the UK contribution, which will increase.”  
According to Austria's Hans-Jörg Schelling,
“Whether the money is to be paid in instalments or as a lump sum is a discussion we can have. But the amount cannot be put in question.” 
Sweden's Magdalena Andersson stroke a more positive note,
“Compared to a situation where the Commission was not going to table a new proposal, of course this is a victory for the UK…Given the amounts, I can understand that one wants to discuss both transparency and the calculations.”  
As regards German Finance Minister Wolfgang Schäuble, he avoided taking a clear stance despite several attempts from journalists at his post-ECOFIN presser. All he said was,
“We have discussed instalments…but we haven't discussed the British rebate...which doesn't mean that the Brits do not raise these questions…I don’t have opinion on that.”
So all clear then...

The most depressing part of this episode is that an enormous amount of energy has been spent, and the UK has been pitted against natural allies, not least the Dutch. Secondly, absolutely nothing on the substance of the EU's wasteful budget has changed.


Denis Cooper said...

Personally I think George Osborne has done a fantastic job by finding out that the EU Commission had always intended to refund half of this extra contribution to the EU budget under the normal UK rebate system.

It couldn't have been easy to drag that information out of them, because his boss David Cameron had spent two days in Brussels in the company of EU leaders, including the President of the EU Commission, and as he had to admit in the Commons afterwards, at Column 30 here:


he had been unable to discover whether this would be the case.

"One of the important questions that needs to be asked and properly answered about this proposed sum of money, which, as I have said, is still an estimate, is how much of it is applicable for the rebate. Obviously, that would make a potentially significant difference to the amount."

So well done, George Osborne, for making a special trip to Brussels and persisting and extracting a proper answer to that question, when the Prime Minister himself had obviously been frustrated in his attempts to do so over two days.

Although to be fair the latter was probably in a state of shock after being handed this massive bill, completely out of the blue, without any warning at all over preceding months; and so maybe it would be premature to suggest that George Osborne should take over from David Cameron as Prime Minister.

Wonni said...

I have a question about the British rebate. Do the Britten pay less contributions to the EU? Why do they get a special treatment over the other EU countries? When do the EU cancel this advantage?

Laura Knight said...

I know it's human nature to look for ways not to pay, but this is no surprise bill, a large part of this country's economic success is down to being part of the EU. It's like you apply for payday loans online and you know you should pay the money back. I think it's fair. A lot of euroscheptics are saying that if the country comes out of the EU than there will be new trade agreements but I doubt very much that any profitable agreement will be reached. I know the EU has it's problems but I doubt anyone can name a government that hasn't.

MC2 said...

Do the Brits actually usually get a 50% discount? Incredible!

And yet still complain? There is no pleasing some people...
Your 'picking the raisins out of the pie' approach is most sickening. I hope you will get your referendum and vote to leave.