Downing Street Says » EU Budget

Asked about what the Prime Minister meant in his press conference this morning when he said that the rebate was an anomaly, the Prime Minister’s Official Spokesman (PMOS) said that, as the Prime Minister had made very clear at the European Council last week, the rebate was the symptom of a problem, it was not the problem itself. The rebate was only necessary because of the distorted nature of the budget. The only way in which we could make a fair contribution under the current system was by having a rebate. Countries such as France got so much more back from Europe in comparison to ourselves, due to the CAP. The fundamental way to address the problem was to address the imbalance in the budget. If you did that then the rebate wouldn’t be necessary. That was why both our Prime Minister and Prime Minister Persson, who he met today saw the fundamental need to address the imbalance in the budget. Asked about the Prime Minister’s phrase, ‘the rebate has to go’, the PMOS said he wasn’t sure the Prime Minister used that phrase but what he said in the Press Conference quite explicitly was that the rebate was on the table if fundamental reform of the EU budget was also on the table and we had a guaranteed process of bringing that about.

Asked if the UK was prepared to increase its contribution to Europe if there was reform the PMOS said that the Prime Minister had said both on Friday at the Summit and yesterday in the House of Commons that if there was a more rational EU budget, based on giving the money where it was needed, both in terms of a country’s wealth, but also in terms of the sorts of issues that Europe needed in terms of spending money, such as R & D, Education and Skills, and so on, we might well, in that situation, end up paying more than we had been. But we would be paying more in any case because of enlargement. The Prime Minister has simply taken forward the logical outcome of a more rational system, but the point was it would be a more rational system.

Put to him that it was the job of the EU presidency to unite, rather than divide or impose its views on the EU, the PMOS said that first of all, as we had made clear throughout, we were not about imposing our views on anybody. We were about the genuine debate and genuine discussion and therefore that was one thing we were not doing. However it was also the role of the presidency to try and give a lead in Europe. To try and help Europe face up to the challenges that would not go away, and the opportunities as well. In that sense we would try and give that leadership, both in terms of setting an overall direction for Europe, but equally in terms of trying to get a resolution of issues such as the budget.

Asked about sorting out the current budget, the PMOS said that last Friday we said that we wanted to see a report on reforming the EU budget by 2008, so that the process would have begun. In terms of whether it was possible to get a deal which included that, we should wait and see how we got on during our presidency. It wouldn’t be for lack of will on our part. We were certainly going to try and get a resolution of the budget as soon as possible. Of course it was not just down to us. Others had to be willing to agree to that. We would continue the debate and see how far we could get. We thought the sooner, the better but it was not just down to us.

Asked if we had any allies, the PMOS said that we did on Friday night. 4 nations voted against the budget and 2 effectively abstained. That suggested we were not alone, but other countries would speak for themselves. Asked what those countries’ reasons might have been, the PMOS said that we accepted that other countries had their own views of the rebate. But other countries were talking up the need for reform. Italy certainly was; on certain issues Spain was; so was Denmark on other issues. So there was the start ofa discussion amongst a wide group of countries about the need for reform. If you looked at the general attitude and we accepted the frustration of the East European countries about not having a deal, but if you looked at their general attitude towards the future of Europe, it was much more favourable to our position than to others. They were reform minded. But we did not want this to turn this into a football league of those who were for us and those who were against us. We genuinely wanted to reach a consensus based on a shared view of what an effective Europe needed to look like. The reason for that was not because we wanted to impose our views on people but because there was a challenge. There was challenge from globalisation which, if Europe didn’t meet, it would directly effect the prosperity of our citizens in the future. That was what the challenge was.

Asked what our plan was, the PMOS said that we would meet the leaders of European countries like we did this morning. We would discuss what their view was. We would listen. In terms of process, we would think about that and the Prime Minister would give some idea of at least the overall direction on Thursday. He would set out his vision of the future. It was not something you could do over night, but it was something you could begin a debate about and see where it took you.

Asked if there were any projected figures of how much we might be paying in a new budget, the PMOS said that in terms of figures, that would depend on what the deal was like and he would not get into speculating about that. Asked how we sell it to the public if it turned out we would be paying more, the PMOS said that what was important was that we paid our fair share and the budget was seen to reflect actual need rather than the priorities of 40 or 50 years ago. If people saw that it was fair and that the money was well spent, and that it resulted in a more prosperous Europe, which meant resulted in us being able to sell our goods to more people in Europe, then the public would accept it was a price worth paying. But it had to be from a rational basis, and it had to meet actual need, not perceived needs from 40 years ago.

Asked if we were simply looking for a commitment to reform the CAP, the PMOS said that in terms of the detail he did not want to get into the negotiation at this stage, that would be premature in terms of where we were. Our position was that we wanted a guaranteed process that would lead to change. In return for that the rebate was on the table. In terms of the actual detail of the implications for the rebate that would be part of the discussions that we would have with our partners first.

Asked how a reform of the CAP would effect farmers in the UK, the PMOS said that as everyone already knew, UK farmers got a lot less than other countries. If you looked at it in terms of comparison with other countries it was a lot less. Therefore we were much less dependent as a country on the CAP than others. Asked how farmers were supposed to plan of there were possible changes to CAP on the horizon, the PMOS said that all business are capable of adapting and could adapt. As the Prime Minister had said yesterday, we they were not looking for an overnight transformation. Therefore would have time to adapt. Equally it was a mistake for Europe to be locked into an out-dated set of priorities right up to 2014 given the speed of change of globalization and the speed of change that countries would need to adapt. Asked what time scale we were looking at, the PMOS said that the proposal we had given was for a report by 2008. That gave you some idea of what we were looking for.

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» Tuesday, June 21, 2005

EU Budget

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