Blair prepares for rebate battle
Prime Minister Tony Blair is preparing for a battle over Britain’s EU rebate at the summit of European leaders in Brussels today.
Although Britain has threatened to veto any bid to axe the £3 billion annual rebate, Mr Blair is reported to be searching for a third way solution to the current spat with his EU counterparts.
He is said to be fearful of Britain being “isolated” at today’s meeting and keen to build the political momentum during Britain’s presidency of the EU this year.
The Prime Minister is thought to be keen on a plan to cancel the contributions made by Eastern European countries to Britain’s rebate – as mooted by EU trade commissioner Peter Mandelson earlier this week.
But he would only want to press ahead the move, which would cost the UK £500 million, as part of a wider discussion of EU finance.
With the rhetoric cooked up in recent days on both sides of the Channel, pundits had expected Mr Blair to lay down the law at the summit.
He has said he will only countenance a wider rethink on the rebate if a quid pro quo on farm subsidies was set in train.
Downing Street insists the unfairness in the EU finances lies with the Common Agricultural Policy (Cap), which sees 40 per cent of spending on farm subsidies meeting the needs of only five per cent of Europe’s population.
French farmers receive £7 billion a year in agriculture subsidies.
Mr Blair will also address the political crisis currently paralysing the ratification of the EU treaty.
With France and the Dutch rejecting the constitution, some have called for the treaty to be scrapped altogether and all future ratification plans put on the backburner.
Sharing this sentiment, Tory leader Michael Howard said yesterday that the treaty was clearly dead in the water.
But European Commission president Jose Barroso has called leaders at the summit to show “political responsibility”.
“We must not be deaf to the views expressed in France and Holland but we need a period of reflection – that is the best way to save the constitution,” he said.
A pessimistic French prime minister, Dominique de Villepin, yesterday predicted British intransigence would mean no deal being brokered at the meeting.
Mr Blair has called for a “pause” for “reflection” to assess the right way forward for Europe, adding: “That’s a decision that has to be made collectively.”
Britain is the second largest contributor to the EU, with Germany paying the most.
