Downing Street Says » Europe Rebate

Asked if the Prime Minister’s position was as Sir Digby Jones had put it to him that Britain would give up the rebate if and only if there was a commensurate and equal giving up of the agricultural subsidy that France got and whether this was a significant hardening of his previous position, the PMOS said we should go back to first principles on this: the abatement was there because of the distortion of the budget as a result of CAP.

The Prime Minister outlined that analysis at the June Summit. He also outlined it again in his speech to the European Parliament. Therefore he was surprised that they were surprised. Put to him that the surprise was the yes to the phrase "commensurate and equal" as that sounded like a pound for pound deal, the PMOS said that he did not agree with the interpretation that this represented some change or hardening of position. This was fully in line with the analysis that the Prime Minster had set out for the reasons for the abatement.

Asked if the Prime Minister was trying to make a distinction between the rebate on CAP and a rebate on structural and cohesion funds and was this part of a strategy to help the East Europeans, the PMOS said he would not get into the detail of our discussions with the East Europeans. As he had said yesterday we were fully aware of the East Europeans desire and need to get a budget agreed, so they could begin to get their money.

Put to him that the Prime Minister had spoken to the Hungarian Prime Minister on the phone in which the Hungarian Prime Minister said his letter was now ready and that they were disappointed with the proposal, the PMOS said that we were in contact with lots of heads of government at the moment but given that we had not yet been to Budapest he thought it best to wait till we were there before dealing with that. Asked if there was any reaction to the Hungarian Prime Minister’s comment saying that what the Prime Minister was now proposing was so far from Hungary’s interests that the best answer was simply: no, the PMOS said the best time for a discussion with the Hungarian Prime Minister would be in Budapest and not via the media.

Asked why the Prime Minister had not met with the European leaders that were at the CBI conference this morning, the PMOS said that we had looked at the possibility of meeting people around today’s event, even before the slight delay that occurred. It was not possible more because of their diaries rather than the Prime Minister’s. It was important that we gave this the proper time and space and we would do that by going to see them.

Put to the PMOS that the French President believed that the Prime Minister’s frayed relations with the Chancellor made it impossible for him to secure a deal during the UK Presidency, the PMOS said that he thought that was the journalist’s interpretation of President Chirac’s comments. We should concentrate on the reality, which was that we were in the middle of a negotiation and we should keep our focus on that not comments from the sidelines.

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» Tuesday, November 29, 2005

Europe Rebate

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