British PM warns EU to 'live within its means'

20th October 2010, Comments 0 comments

Prime Minister David Cameron said Wednesday that Britain would not accept any rise in the EU's budget, saying the bloc had to "live within its means" as his government unveiled harsh cuts at home.

Britain opposes "and will go on opposing" increases in the 27-member bloc's budget, Cameron told parliament just minutes before his finance minister listed billions of pounds worth of austerity measures to tackle a record deficit.

"I am actually clear we will not accept any increases in the EU budget in the next seven-year financial perspective," Cameron said.

He said Britain was trying to win allies to put across the argument to the European Union that "we need to make sure that Europe starts to live within its means."

The EU's executive arm last week unveiled proposals to increase the ability of Brussels to raise its own funds for the 2014-2020 budget to reduce contributions from cash-strapped governments.

The idea of a European tax has already met resistance from economic powerhouses Britain, France and Germany following a recession and debt crisis that forced governments to cut national budgets and raise taxes.

About three-quarters of the EU's budget, which totalled around 123 billion euros (172 billion dollars) this year, is funded through national government contributions, the rest coming from a levy on national VAT receipts and import duties.

The proposals set the stage for tough negotiations over the 27-nation bloc's 2014-2020 budget, with battle lines drawn over farm spending, which accounts for 40 percent of expenditures, and rebates for states such as Britain.

© 2010 AFP

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