The UK’s surcharge of £1.7 billion will be halved to just £850 million, Britain’s Chancellor of the Exchequer announced on Friday after meeting with EU finance ministers in Brussels. However, Dutch Ministers say it is not true, while the Labor party is accusing the Tories of “smoke-and-mirrors” deception spin.
Labor shadow chancellor Ed Balls said Mr. Osborne’s claim was a “diplomatic disaster for the government.”
News update, Nov 8, 2014: European Finance Ministers say Mr. Osborne did not negotiate the surcharge amount.
Many European finance ministers said the amount the UK had to pay remained the same, but Osborne chose to include some rebates that were already coming Britain’s way. In other words, he fudged the accounts to con the electorate.
Ed Balls said:
“David Cameron and George Osborne are trying to take the British people for fools. Ministers have failed to get a better deal for the taxpayer. Not a single penny has been saved for the taxpayer compared to two weeks ago when David Cameron was blustering in Brussels.”
In fact, some ministers even claimed that a rebate was never discussed at the Brussels meeting. If this is true, Mr. Osborne will have a lot of explaining to do.
Mr. Osborne, who described the deal as “far beyond what anyone had expected,” added that as well as halving the total bill, he also managed to delay its payment, and with no interest charges to boot.
If mistakes are detected later in the bill, the UK will get its money back, Mr. Osborne claimed.
The UK government today, referring to the surprise surcharge, assured its electorate that “this will never happen again.”
When receiving a demand for payment of £1.7 billion by December 1st because the UK economy had expanded better-than-expected, Prime Minister David Cameroon was furious, especially when told that failing France was being rewarded with a massive €1 billion rebate.
If George Osborne caves in to pressure from Brussels, the Conservatives’ chances of winning next year’s general elections will evaporate.
Most of Britain’s population wondered at the European Commission’s weird logic of rewarding failing economies with money and punishing successful ones.
With general elections in 2015 and the anti-EU UKIP party gaining ground at the expense of the Conservatives, Mr. Cameron needs to show that he can stand up to Brussels.
The United Kingdom’s net contribution to the EU of £8.6 billion would have risen by one fifth had the country paid out the full amount.
UKIP leader, Nigel Farage, had challenged Mr. Cameron to refuse to pay anything at all. Mr. Farage said in October:
“This is the EU making clear that economic success is not to be applauded but to be punished. Mr Cameron has to veto this if he is to have any credibility at all.”