UK to pay hundreds of millions more to EU
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Your support makes all the difference.BRITAIN WILL have to contribute hundreds of millions of pounds more towards funding Europe after a compromise struck by Tony Blair yesterday.
The Prime Minister agreed to renegotiate on European Union financing at the summit of EU leaders in Vienna, but secured Britain's right to continue to enjoy an annual pounds 2bn rebate.
Mr Blair conceded that the UK will shoulder its share of the costs of enlargement of the Union, with contributions having to increase when new countries are admitted.
Asked about the UK's willingness to boost its payments after enlargement, Mr Blair hinted at readiness for negotiation by replying: "We will pay our share."
The conciliatory tone came at the end of two days in which European leaders have publicly raised the rebate, and demanded that every issue should be up for negotiation when decisions are reached next March.
They also agreed to a stay of execution for duty free goods after hours of frantic late-night summit negotiation. Although Mr Blair won a rethink on a "possible limited extension" of duty free, he failed to secure full agreement to a reprieve.
On the rebate, Mr Blair appeared to open the way for discussion of German- backed plans for the scope of Britain's reallocation to be limited when up to 11 new states are admitted to the EU during the next decade.
That followed a Commission report which argued that, if the rebate continues as currently constituted, Britain will not pay its share. Earlier this year Jacques Santer, the Commission president, argued that the UK's "case for a rebate has gradually become weaker", and will be even more so after enlargement.
Yesterday, the Prime Minister defended the mechanism, saying that without it "Britain's contributions are wholly unfair". Negotiated in 1984 by Margaret Thatcher, the rebate is highly sensitive and any concession would be politically explosive.
Mr Blair made clear that one clear area for compromise is likely to include cuts in EU grants to poor regions across Britain.
Officials said Britain is now willing to negotiate "structural fund" payments, worth pounds 1.6bn to the country a year. One likely victim is Scotland, a long-standing recipient of support from Brussels - something which could be highly damaging for Labour in the run-up to elections to the Scottish parliament next year.
Downing Street is aware of the risk of being blamed for delaying enlargement by adopting a recalcitrant attitude on the rebate.
As the summit drew to a close, pressure continued as French President Jacques Chirac argued that "everyone has to pay for enlargement". Dutch Premier Wim Kok, added: "Britain needs to find a way to compromise."
Summit reports, page 13
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