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Last Updated: Wednesday, 14 July, 2004, 21:04 GMT 22:04 UK
EU rebate stays, Britain insists
Denis MacShane
The British Minister for Europe, Denis MacShane
The government is refusing to negotiate with the European Commission over plans to scrap the UK's �2bn EU rebate, won by Margaret Thatcher in 1984.

The plans, unveiled on Wednesday, would nearly double Britain's contributions, making it the EU's biggest paymaster.

But Europe Minister Denis MacShane said the rebate was not up for discussion.

And UK EU commissioner Chris Patten told EU budget commissioner Michaele Schreyer the plans were "manifestly unfair" and "not the basis for debate".

"I am deeply disappointed and concerned that the proposals will set back our ability to argue a positive European case in the UK," he added.

Ms Schreyer wants to replace the British rebate with a general refund for all big net contributors.

Explaining her plan, she said: "The sums allocated to poor new member states is growing and the British rebate is also growing to the burden of others."

Britain now had a "magnificent" economy and no longer needed the rebate, she added.

This proposal is a crude smokescreen by the commission to divert attention from their bloated budget proposals to increase EU spending by 25%
British Government

But a British Government spokesman said: "This proposal is not negotiable.

"It is ludicrous and manifestly unfair to suggest doubling the UK's share of the EU bill while leaving more than �6bn a year flowing into French coffers from farm subsidies.

"The rebate is fully justified by all the data available.

"This proposal is a crude smokescreen by the commission to divert attention from their bloated budget proposals to increase EU spending by 25%."

UK Independence Party MEP Robert Kilroy-Silk has written to Tony Blair urging him to fight for the rebate.

"I am telling him to say that this is not an issue, that it is not negotiable and that he must exercise the veto to prevent this from happening," the eurosceptic said.

Tony Blair's official spokesman said last week: "We recognise that, in relative terms to most other EU countries, we have become more prosperous over the past decade, but we still believe the rebate is justified because of the distortions in programmes such as the CAP (Common Agricultural Policy).

"Any change would have to be passed unanimously so that does give us a veto."




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The BBC's Stephen Sackur
"The British contribution to the EU would be effectively doubled"



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