UK ABATEMENT
Letter from Rt Hon Geoff Hoon MP, Minister
for Europe, Foreign and Commonwealth Office to the Chairman
Following my Evidence Session before the Committee
on 13 July, I promised to respond in writing on the following
question.
Recent press reports have indicated that the
Chancellor is raising questions over whether the UK should be
required to contribute to the reductions in GNI and VAT resources
to the Budget agreed by the December council meeting under the
UK Presidency.
(i) What is the definitive Government position
on whether the UK should be required to help finance these reductions
in the contributions granted to other Member States?
(ii) Can you give us figures which will enable
us to compare the expected contributions from the UK, France and
Italy to the EU over the period of the next Financial Perspective?
(i) Discussions on the Own Resources Directive
are on track. We are looking at the draft text carefully to make
sure it properly reflects the December deal. We are confident
that an agreement will be reached in good time to come into force
in January 2009.
The December deal specifically states that "the
UK abatement shall remain". The only areas where the abatement
is "disapplied" is in expenditure on economic development
in the new Member States. The UK has always been a strong supporter
of enlargement and accepts the additional financial burden that
this places on the more wealthy Member States.
(ii) UK contributions will be published
in the budget in the usual way. The Government does not generally
publish forecasts of other Member States' contributions, which
are a matter for the Member States in question. But we (and the
Commission) expect that, expressed as a proportion of Gross National
Income, the total net contributions over the period 2007-13 of
the UK, France and Italy will be closely similar. In contrast,
on the same basis over the period 1984-2004, the UK has paid on
average nearly two and a half times as much as France and three
and a half times as much as Italy.
20 July 2006
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