Britain's Cameron in new row over EU demand for extra 2.1 bn euros

24th October 2014, Comments 0 comments

Prime Minister David Cameron headed for a fresh showdown with the EU on Thursday after Brussels demanded an extra 2.1 billion euros from Britain because its economy is thriving while Europe stalls.

Under new budgetary calculations, deficit-laden and struggling France will be owed 1.0 billion euros ($1.27 billion), a European Commission spokesman said.

Germany, the bloc's most powerful and richest economy, meanwhile gets a rebate of 779 million euros.

The Netherlands is like Britain tapped for more funds, having to pay 300 million euros, spokesman Patrizio Fiorelli added.

The surcharge is a fresh blow for Cameron, who faces an election in May and has promised an in-out referendum on Britain's EU membership in 2017 to curb a growing threat to his Conservative party from the eurosceptic leader Nigel Farage.

The surcharge is based on a revision in the way that economic output is calculated and the overall economic situation of each country, the commission spokesman said.

"The British economy is growing much faster than the others and the logic is the same as with tax: if someone earns more, they pay more tax," Fiorelli told AFP.

"Mathematically that means 2.1 billion euros more for 2014 for Britain, more than 300 million for the Netherlands and a billion less for France."

The British economy is recovering well from the slump after the financial crisis, growing by 3.2 percent in the second quarter of 2014 compared to a year earlier.

In contrast, the European economy is stalling, dragged down by France and and now a slowing Germany.

Britain said it would work with the Netherlands and vowed to challenge the demand.

"It's not acceptable to just change the fees for previous years and demand them back at a moment's notice," a source in Cameron's office said.

"The European Commission was not expecting this money and does not need this money and we will work with other countries similarly affected to do all we can to challenge this."

Britain has long defended a cherished £3.1 billion (3.92 billion euro) annual budget rebate won by late prime minister Margaret Thatcher in 1984.


© 2014 AFP

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