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Last Updated: Wednesday, 9 March, 2005, 01:24 GMT
EU urged to reform its spending
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The EU should not fix budgets far in advance, peers said.
The European Union should urgently reform the way it spends its money, a committee of peers has said.

Current and planned spending on agriculture was "disproportionate", the Lords European Union Committee said.

Funds for regional development should only focus on the 10 new member states and Portugal and Greece, it added.

It said Britain's 3bn EU rebate was justified while the Common Agricultural Policy remained, but it was sensible to review this when the CAP is reformed.

"While the share of agricultural spending remains so high, the government is fully justified in defending the British rebate, the case for which arises because of the impact of the Common Agricultural Policy.

"Only when CAP has been further reformed would it be sensible to consider a generalised corrective mechanism," the committee's report on Future Financing of the European Union said.

It was "highly regrettable" that the EU had fixed agricultural support payments from 2007 to 2013.

"We recommend that the council should never again seek to pre-empt negotiations" on finance in this way, peers said.

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