The payment date for the extra money, amounting to £1.7billion comes on 1st December just days after the important by-election in Rochester. The EU say that they want the increased contribution because Britain’s economy is doing better than other EU countries. France will get back £790million as its economy performed less well. Germany, surprisingly, also gets £614million back.  This represents a 20% increase to the EU from the UK.

A senior EU source told the Daily Telegraph that the scope for a legal challenge was non-existent.:

“This at the commission’s discretion. It is automatic, there is nothing Britain can do about it,” said the official.

The payment, or “surcharge”, follows a change to the way the EU calculates gross national income which now includes previous hidden service industries, including such as prostitution and illegal drugs.

Nigel Farage said:

“Every single strategy the Prime Ministers has adopted on the EU has failed. He now has two choices: to hold a referendum before the next general election or to lose the election. He could possibly lose the leadership before that as the discontent is growing.”

Douglas Carswell also said:

‘David Cameron’s Europe policy is literally incredible. We cannot believe him. Not since Ted Heath have we had such a bad deal for Britain.’

The principle which is at work here is that if a EU country’s economy improves, then instead of that country being allowed to use it for its education, health, or defence budgets, the EU gets first call in the extra money. In other words, the EU now can have priority over all future economic gains.

David Cameron today was said to be ‘visibly furious’ as he hit out at the surprise £1.7billion EU bill, and spoke of anger at:

“…appalling’ way Britain has been treated by European Commission…I’m not paying that bill on December 1. It is not going to happen…” Telegraph.

Apparently, the Treasury may have known about this for some weeks before. If they did not know then this must be regarded as a calculated ambush by the EU, possibly in response to Cameron’s recent failure to support the principle of open-doors immigration in the EU. One outcome may be that there is a compromise or a delayed payment arranged to save face for Cameron, involving concessions elsewhere in less public areas, but still requiring ultimate payout.

The big question which must be asked of the Chancellor George Osborne, is where will the £1.7billion due by 1st December come from? Which budgets will be cut, or which taxes will rise to pay for it?

We are continually being told by Labour that the Coalition is not spending enough on education, health, welfare, and a whole coterie of other financial holes. Yet they must now feel dismayed and possibly a little betrayed that their EU ‘friends’ arbitrarily see fit to deprive our social services of a whole chunk of funding.

To sum up the main points:

  • UK contribution to the EU up 20% to £66million a day
  • The £1.7billion extra to be paid on December 1st this year
  • France and Germany to get rebates
  • Greece must pay an extra £70 million
  • Italy, in big economic trouble, must pay £268 million extra, even as the EU demands spending and borrowing cuts
  • This move establishes the principle that the EU has first call priority over any national gain in income
  • It is not clear whether the Treasury knew about this or was even aware of the effect of the changed EU formula
  • The new rules calculate back to 1995 and now take into account prostitution and drug economies
  • It comes on top of Tony Blair’s reduction in the UK rebate which has already lost us £10.4billion
  • Cameron apparently only found out about the bill on Thursday this week
  • Cameron may bluff, bluster, and posture, but only until the Rochester and Strood by-election is over

This will only strengthen the resolve of Eurosceptic MP’s in the other parties and make it harder for Cameron to push the line that he can control EU spending and reform the EU.

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