Downing Street Says » EU Budget

Asked if the Prime Minister was pleased with the reactions to the budget proposals for the EU, the Prime Minister’s Spokesman (PMOS) replied that the Prime Minister believed that people did accept that we had to put our money where our mouth was. That meant that we did have to pay our contribution to the costs of enlargement. What it did not mean, however, was that there would be a change in the rebate going to the Common Agricultural Policy (CAP) and the original fifteen member states until there was a fundamental change in the CAP. That had been our approach, along those principles and in that spirit, since 1999, and it remained our approach. In terms of the rest of Europe, we understood that it did pose difficult questions for other countries in Europe, and that it would not please everyone. However, what was made clear to the Prime Minister when we went to the Accession countries last week was that they would like a deal now. A deal would allow them to plan their budgets and organise the money they needed to develop their economies. We believed it was in our national interest because the sooner they became more prosperous, the sooner they grew as markets for our goods and services.

Asked if the Prime Minister believed he had to compromise, given the Polish Prime Minister and the Presidency Commissioner’s recent comments about the proposals being "unacceptable", the PMOS replied that we were in a negotiating period, and people should wait and see where things got to. We had set out our proposals, and we would talk to others about them.

Asked if the Prime Minister would be meeting President Chirac soon, the PMOS said that if we needed to talk to President Chirac, then we would talk to him at some stage.

Asked if there would still be no change to the rebate, as was the Prime Minister’s aim, the PMOS replied that in terms of the existing fifteen members, there was no change to that. In terms of the new Accession countries, we had always said that we believed that we should not take up our full share of what was due to us, because we believed it was in our interest to help them develop in terms of their infrastructure and prosperity. Therefore, they would become better markets for our goods and services, and that meant more British jobs. The PMOS said that had been the principle that we had laid down since 1999.

Asked if that remained the case, even if there was no deal within our Presidency, the PMOS said that first of all, we should try and get a deal in our Presidency. The Accession countries had reservations about what we were proposing, but at the same time, they did have a choice to make. That choice was to hold out for what might or might not be a better deal in the future, but that did not deliver them the money now and in our view was not likely to deliver them the money within the next one or even two years. Experience suggested that countries in their position did not spend all the money that was allocated to them in any case because of the absorption factor.

Put that something that was already on the table could not be taken away, the PMOS said we should deal with one negotiation at a time.

Asked if it was possible to adapt our existing offer on the rebate, the PMOS replied that the question was going into hypothetical territory, and it was better to deal with what was actually on the table.

Asked if there was room to compromise on the various aspects of the rebate, the PMOS said that it was always better to deal with the reality of the discussions with our colleagues, rather than getting into theoretical debates.

Asked if the Prime Minister regretted any aspect of losing part of the rebate, the PMOS said that what the Prime Minister had always believed was that we had to pay our fair share towards the cost of enlargement. We did this not because it was an act of charity, but because it was an investment in the future of British jobs, industry and services.

Experience suggested that in the examples of Ireland or Spain, British goods had increased selling to those countries once they had come up to the EU average. That was why it was not a matter of charity, but rather a hard-headed act of investment. However, it posed questions and difficulties we recognised for other countries, but we should see where they came out.

Asked what the Prime Minister’s response to President Barroso’s suggestion that the British proposals would make enlargement to the remaining countries impossible, the PMOS said that we had set out why we believed that these proposals helped enlargement, and why they dealt with the reality of what countries could actually spend, rather that what they might spend. It was for others to respond to that, and to have private discussions about it. That was what we would do.

Asked if the Prime Minister thought it appropriate for President Barroso to make comments, given that he was an unelected official, and also what was the status of the 2008 review, and did we have to have it, the PMOS said that President Barroso represented quite properly the views of the Commission. With regards to the mid-term review, that was fundamental to our position, because we believed it was necessary to look at the structure of the EU budget, as the Prime Minister had set out.

Put that given the hostile reactions that there had been, was it possible to still get a deal, the PMOS said it would depend on the outcome of the discussions with our partners. We believed that everybody had to make choices on this. The fundamental choice was: did people want the deal that from their individual aspects might not be ideal, but actually did give them a degree of stability and certainty and allow the Accession countries to plan their future, or did people want to hold out for some ideal position which might take a longer time to deliver, if at all? That was the essential choice that people had to make.

Put that if there was an enlarged EU, there had to be an enlarged budget, which seemed to be one of the fundamental problems, the PMOS said the question was not whether the budget increased, but rather by how much. What the Prime Minister had said was that he was prepared to see further increases if there was proper, fundamental CAP reform. Our preference was that that was the road we would go down, but it had to be in the context of fundamental CAP reform. Unfortunately, at the moment, that did not seem to be an offer, but that did not mean we had given up on it. We did have to deal with the reality of the situation we were in.

Put that there seemed to be a "big deal and a little deal" and we appeared to be more concerned with the little deal, the PMOS replied that we had not given up on the big deal, and in terms of the mid-term review, that was why we placed the importance we had on it. However, we still had to deal with the reality as we had it today, rather than a wish list. We had to make hard choices, as did others.

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» Tuesday, December 6, 2005

EU Budget

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