Pressure mounts as Dutch reject EU rebate

3rd June 2005, Comments 0 comments

3 June 2005, AMSTERDAM — Exerting greater pressure on the EU, Finance Minister Gerrit Zalm on Friday rejected as inadequate a proposal to reduce the Dutch contribution to the union's budget.

3 June 2005

AMSTERDAM — Exerting greater pressure on the EU, Finance Minister Gerrit Zalm on Friday rejected as inadequate a proposal to reduce the Dutch contribution to the union's budget.

The Netherlands is using the public's 'no' vote against the EU Constitution in Wednesday's referendum as leverage to cut the amount of money it pays into EU coffers.

A Finance Ministry spokesman said the government was not ruling out using a veto to block the EU budget, news agency AFP reported.

Luxembourg, which currently holds the EU Presidency, presented a new proposal on Friday for the multiple-year budget from 2007 to 2013.

The Dutch government can expect a reduced annual contribution starting from 2007 amounting to EUR 350 million to 500 million per year.

The reduction would be for a total of seven years, at which point the Netherlands would have to re-enter talks over a reduced contribution.

Under the proposals, Britain would receive a fixed rebate of EUR 4.5 billion on its net contribution instead of an automatic two-thirds. The rebate will fall even further in years to come.

Besides the Netherlands, the EU's largest net financiers Germany and Sweden will receive a rebate also, via a reduced tax-based payment.

Together with The Hague, both Berlin and Stockholm are working on a permanent rebate system for national EU budgetary contributions.

The Dutch Cabinet has made the new discount system its highest priority in discussions around the EU budget.

The relatively large payment the Netherlands makes to the EU was one of the reasons why a big majority of Dutch voters rejected the EU constitution.

"The Netherlands now pays EUR 180 per person annually, Sweden EUR 95 and Germany EUR 71. We have to get to the level of those countries immediately, otherwise a veto will follow," Foreign Affairs Minister Ben Bot has said.

EU leaders will meet on 16-17 June to reach a deal on the budget, but any chance of success is considered slight. Britain, for example, is strongly opposed to any adjustments to its rebate.

In what is shaping as a crisis summit, EU leaders will also need to agree at that meeting on how to proceed with the constitution.

Some leaders have called for the ratification process to continue despite the French and Dutch no votes, but reports emerged on Friday that the process might be temporarily put on hold.

Luxembourg Prime Minister and EU President Jean-Claude Juncker warned of a great crisis in Europe if no accord is reached over the EU budget.

Dutch European Affairs State Secretary Atzo Nicolai was cautiously positive about Juncker's budgetary proposals. "They are moving in a good direction. We shall very carefully study the proposal," he said.

Under the proposal, spending over the seven-year period would be capped at EUR 875 billion, the equivalent of 1.06 percent of Gross National Product (GDP).

The Netherlands, like Austria, Britain, France, Germany, and Sweden, wants the budget to be capped at EUR 815 billion, the equivalent of 1 percent of GDP.

[Copyright Expatica News + ANP 2005]

Subject: Dutch news

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