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France to stump up €1.5 billion for UK rebate

Ben McPartland · 16 Oct 2014, 13:16

Published: 16 Oct 2014 13:16 GMT+02:00

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A recent European-wide poll revealed much about how the French see Britain’s place in the EU.

The survey found that people in most European countries want Britain to stay in the bloc, with the exception of France.

That feeling of French resentment towards Britain’s place in the EU unearthed in the poll, will only be added to with a new report highlighting how much France pays for Britain’s controversial EU-budget rebate.

The refund, negotiated by Margaret Thatcher and former French president François Mitterand, was originally awarded to the London to make up for the small amount of farming subsidies it receives from the EU compared to France.

France has always been Europe’s main contributor to the rebate that share continues to rise.

Since 2002, Germany, Sweden, the Netherlands and Austria have all ensured that their contribution to the British rebate does not exceed certain levels, which has effectively meant the French are contributing a larger portion of the pie.

According to the report cited by BFM TV, next year France will pay €1.5 billion euros towards what is officially referred to as the “UK correction” - that represents around a quarter of the 2015 rebate which will stand at €5.4 billion.

That’s a slight jump on the €1.42 billion shipped over the Channel in 2014 but a big leap from the €900 million handed over from Paris to London in 2010.

The figures, which were revealed in a document accompanying France’s draft budget law currently being discussed by parliament, will no doubt concern President François Hollande.

Hollande who has failed to kick start France’s beleaguered economy has called on the EU’s budget mechanism to be reformed, but so far no steps have been taken to change it and no doubt London will fight tooth and nail against any move to scrap the rebate.

Speaking in 2013 before the EU budget negotiations Hollande fired a warning to David Cameron that if he wanted cuts to the EU budget then he would have to ask a cut in the UK’s rebate.

Speaking to MEP’s in Strasbourg Hollande said at the time: “There are those who want to see cuts, others - possibly the same, who want guarantees on their own rebate.

Story continues below…

“The size of refunds and rebates must stop rising and in the future the EU must have its own financial resources.

“A compromise is possible but it must be reasonable and therefore we must reason with those who want to cut the EU budget beyond what is possible to accept,” he said.

It is calculated as approximately two-thirds of the amount by which UK payments into the EU exceed the bloc’s expenditure returning to the UK.

Prime Minister David Cameron has pledged to hold a referendum on Britain's membership of the EU if his conservatives win the next election.Who finances the EU budget?

  • Germany: 21.3%
  • France: 16.3%
  • Italy: 12.2%
  • UK: 10.9%
  • Spain: 8.1%

Ben McPartland (ben.mcpartland@thelocal.com)

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