Europe South Asia Asia Pacific Americas Middle East Africa BBC Homepage World Service Education



Front Page

World

UK

UK Politics

Business

Sci/Tech

Health

Education

Sport

Entertainment

Talking Point
On Air
Feedback
Low Graphics
Help

Tuesday, December 22, 1998 Published at 22:24 GMT


Business: The Economy

Rebate dispute scares spending Eurocrats



The UK defends its budget rebate, Germany wants to pay less, other EU countries are getting itchy - and as the BBC's Rodney Smith explains, those who spend the money get scared.


[ image: Rodney Smith]
Rodney Smith
Eurocrats may have good cause to feel threatened by a new trend in Europe.

It's the habit, begun by Britain, of arguing for and getting a rebate on the funds these countries pour into EU coffers.

Margaret Thatcher famously argued for and won the first of these concessions from a furious Brussels in the mid-1980s. Now Foreign Secretary Robin Cook is repelling suggestions that Britain abandon its rebate, worth about £2bn a year.

So far so what? Well, Germany has joined in. The Germans are the biggest contributors to the EU. They have been throwing billions of high value marks at the EU for decades on top of the crippling cost of reunifying the two German halves.

Now they're calling a halt.

The EU's annual budget absorbs £60bn of members' taxpayers' savings. A few billion less may not seem to make much difference; not a big threat to the high spending lifestyle of some Eurocrats which so upsets voters - and taxpayers - in Britain and other member states.

But the trend is welcome. Every year, the Commission admits to losing several billions of ECUs (read dollars) to inefficiency and undetected fraud. Anger at this is the main reason why the Commission is for the first time under serious threat of being binned by the European Parliament. It, like member governments, wants more accountability from unelected Eurocrats.

But the new German financial concern is not based on anxiety about EU spending so much as about the tight state of the German economy, and the need to spend on domestic, generally social, programmes. German unemployment is 10%.

But if the debate rages long and loud enough, the message could start to get through to German taxpayers. Then who knows? French taxpayers, Italian taxpayers, earners in Europe's wealthier states, who may start to question the need to pay as much as they do to the EU.

What better way to control spending by the Commission at large?



Advanced options | Search tips




Back to top | BBC News Home | BBC Homepage | ©


The Economy Contents

In this section

Inquiry into energy provider loyalty

Brown considers IMF job

Chinese imports boost US trade gap

No longer Liffe as we know it

The growing threat of internet fraud

House passes US budget

Online share dealing triples

Rate fears as sales soar

Brown's bulging war-chest

Oil reaches nine-year high

UK unemployment falls again

Trade talks deadlocked

US inflation still subdued

Insolvent firms to get breathing space

Bank considered bigger rate rise

UK pay rising 'too fast'

Utilities face tough regulation

CBI's new chief named

US stocks hit highs after rate rise

US Fed raises rates

UK inflation creeps up

Row over the national shopping basket

Military airspace to be cut

TUC warns against following US

World growth accelerates

Union merger put in doubt

Japan's tentative economic recovery

EU fraud costs millions

CBI choice 'could wreck industrial relations'

WTO hails China deal

US business eyes Chinese market

Red tape task force

Websites and widgets

Guru predicts web surge

Malaysia's economy: The Sinatra Principle

Shell secures Iranian oil deal

Irish boom draws the Welsh

China deal to boost economy

US dream scenario continues

Japan's billion dollar spending spree