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Friday, March 26, 1999 Published at 09:47 GMT


Blair deal on Euro rebate

Leaders talked through the night to come to a deal

The UK is to keep its £2bn ($3bn) rebate from the European Union after marathon summit talks in Berlin.

EU in crisis
But Prime Minister Tony Blair did make a concession on the future size of the payment when the EU takes in extra members over the next few years.

The deal was part of an agreement which took the leaders 20 hours to thrash out.

Mr Blair said the deal represented "not a Euro more, not a Euro less" for the UK.

Tony Blair: "Not a euro more, not a euro less"
But his concession could ultimately cost the Treasury £154m a year.

Had nothing changed, the UK's rebate would actually have risen as the EU enlarges into eastern Europe.

Mr Blair agreed to forego this increase, saying there was no need for the UK to receive a "windfall" from EU enlargement.

Shadow Foreign Affairs spokesman David Heathcoat-Amory: Deal will cost Britain money
The prime minister told a news conference: "It was an immensely difficult and hugely complex negotiation, but the changes pave the way for enlargement."

He admitted he would have liked to see more radical cutbacks in agriculture spending, but added: "To get this far and come to this agreement is a not inconsiderable success."

[ image:  ]
France, the biggest beneficiary of farm subsidies, held out for a better deal while Spain also delayed until the last minute for a better deal on its regional aid.

As expected, the UK's regional aid was also changed, although a deal was done to allow a "peace programme fund" to be paid to Northern Ireland.

The province will lose its top priority Objective One status, which has netted it nearly £1.2bn over the past five years.

Angus Roxburgh: "He has made quite an important concession"
But to cushion the blow the summit gave it £280m over the next five years, with a further £70m allocated to border regions of the Irish Republic.

An annual EU contribution to the International Fund for Ireland of £10.5m was also renewed for three years and there will also be "transitional" funding to top up the sum.

Cabinet members fight for Scotland

The Scottish Highlands and Islands also loses its Objective One status, but again what is taken away with one hand, is given back by another.

Between 1994 and 1999 the region received £247m from the EU but a "special phasing out programme" for 2000-2006 will guarantee it £210m.

According to the deal this is "in view of the particular structural problems resulting from low population density matched with a high degree of poverty".

Extra government top-up funding of about £70m is also likely for the UK's most northern area.

"This is a fantastic result for Scotland - and there is special provision for Northern Ireland," said Mr Blair.

The prime minister added that negotiations on Scotland were helped by the presence of Scottish cabinet members Robin Cook and Gordon Brown at the summit.

Regions join list

Merseyside is the only existing Objective One area to maintain its top priority status for the next five-year programme.

But west Wales and South Yorkshire now join it on the list - a "tremendous outcome for west Wales and the valleys", according to the prime minister.

"We will be able to deliver the investment Wales needs in terms of its regeneration, giving Wales a far better basis for a successful future."

Cornwall is also now categorised among the top priority regions after it was split away from its more prosperous neighbour Devon.

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