Wednesday, March 16, 2005

And your point is?

I suppose there is some point to the Telegraph's story today, which trains the headline: "Britain 'gets less out of EU than anyone'". Why this should be news at all is anyone’s guess, as that is one of the main points Eurosceptics have been making for decades.

Nevertheless, Gordon Brown has said it and that makes it good enough to put in the paper, with the claim that he had "launched the second broadside in two days at the European Union" as it became clear that a row over the EU and its finances would be one of the defining features of his Budget today.

This "intelligence" was based on a parliamentary answer yesterday by Stephen Timms, financial secretary to the Treasury and one of Mr Brown's junior ministers, who used it "to demonstrate the Chancellor's growing impatience with the EU's financial laxity." According to the Telegraph, "in a rare outburst from a Labour minister," he claimed that the EU's budget system is "unfair" and that Britain gets less out of it than any other member state.

Mr Timms' answer was accompanied by a table of Britain's net contributions to the EU, which showed that in 2003, the latest year for which figures are available, Britain paid £3.7billion more than it got back, even after the rebate of £3.6billion. This makes Britain the second largest net contributor after Germany.

However, says the Telegraph, the figures also reveal that chaotic accounting means nobody is absolutely certain how much Britain contributes. The Treasury's estimate for 2003 is more than the £3.3 billion reported by the Office for National Statistics and the €1.8billion (£1.2 billion) quoted by the EU in its own accounts.

That is something we have always been puzzled by as the Treasury "pink book" figures rarely correspond with those produced by the commission. Apparently, the Treasury has investigated the big differences and says they can be partly explained by the timing of payments and the fact that the EU itself does not count some tariffs. It is rather appropriate though, that we cannot even agree on how much Britian pays.

Nevertheless, Brown believes the position to be unfair as the UK receives little from the EU in the form of agricultural subsidies or structural funds. An official EU document called European Commission Allocated Expenditure 2003 shows that Britain received grants from the EU worth just 0.36 percent of national income, less than any other member.

Anyhow, despite the Telegraph's prediction, the EU budget did not feature prominently in the budget speech today – if at all – in an event that was described by one commentator on the BBC News as "boring". All the same, it is not going to be the end of the issue by any means and one hopes it comes back to bite Blair when he has to deal with the subject when the UK holds the EU presidency in the second half of this year.

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