EU: Britain would become the biggest net contributor to the EU budget - paying 50 per cent more than France - under draft European Commission plans to scrap the €4 billion British rebate, writes George Parker, in Brussels
The proposals will be fiercely resisted by British Prime Minister Mr Tony Blair and have been denounced as "naive" by Mr Neil Kinnock and Mr Chris Patten, the two British EU commissioners.
A prolonged confrontation with the EU over money is a grim prospect for Mr Blair, as he prepares to sell the new European constitutional treaty to voters in a referendum likely to be held in 2006.
Although British diplomats believe they can delay a decision on the future of the rebate until after a likely British general election in spring 2005, it could sour a referendum campaign.
Ms Michaele Schreyer, EU budget commissioner, wants to end the 20-year-old British rebate and replace it with a general refund mechanism for all big net contributors to the €100 billion annual budget. The move would reduce the burden of countries including Germany, the Netherlands and Sweden, but would see a sharp rise in Britain's contribution.
Mr Blair has vowed to defend the rebate, won by his Conservative predecessor Mrs Margaret Thatcher at the Fontainebleau summit 20 years ago with her famous cry: "I want my money back."
Although Britain can veto any changes to EU financing, Mr Blair will be under strong pressure to give up some of the annual refund, which would rise from about €4 billion now to over €7 billion in the next seven-year budget period.
Ms Schreyer's draft plan would take the British budget rebate and distribute it among all countries whose net contributions to the EU budget exceeded 0.35 per cent of gross national income.
The commissioner says the British situation has changed since 1984, and that the UK is the second wealthiest country in the EU after Luxembourg. Under the plan, the UK would become the biggest per capita paymaster in the 2007-13 budget period, with a net contribution of 0.51 per cent of gross national income. - (Financial Times)