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Cameron vows to defend Britain's European rebate

DAVID Cameron has warned he will veto anything that threatens the UK's multibillion-pound rebate ahead of crunch European Union (EU) budget talks beginning today.

SETTING OUT HIS STALL: David Cameron vowed to veto any attempt to cut the rebate received by the UK from the European Union. Picture: PA
SETTING OUT HIS STALL: David Cameron vowed to veto any attempt to cut the rebate received by the UK from the European Union. Picture: PA

The Prime Minister will travel to Brussels for meetings with EU leaders that could stretch into the weekend as he attempts to persuade them to back, at the very least, a freeze in spending.

The Conservative leader also insisted yesterday he would fight incredibly hard to defend the UK's rebate.

The Coalition has attacked Labour for giving up part of the cash while in power.

The system, which ensures the UK gets money back from its EU contribution, is under fire on a range of fronts.

A number of draft EU budgets being proposed would see changes or cuts to the money that the UK gets back.

Asked in the House of Commons if he would veto any deal that reduces the rebate, Mr Cameron said: "I can give my honourable friend that assurance.

"The rebate, negotiated by Margaret Thatcher, is an incredibly important part of making sure Britain gets a fair deal in Europe."

During the last round of budget negotiations, in 2005, then Prime Minister Tony Blair agreed to give up part of the annual rebate, at a cost of an estimated £10 billion so far, to ease EU expansion.

Other decisions taken at the talks meant the amount the UK gives the EU has been steadily increasing.

Downing Street is thought to be prepared to allow that rise to continue if it manages to secure a freeze in the EU budget.

But the Prime Minister's woes were increased when Conservative chairman Grant Shapps appeared to suggest that he would only return with a deal if the UK's contribution was reduced.

He said that it would be unacceptable for the UK to increase the money it gives the EU.

Mr Shapps said: "We have to get away from the situation where, under Blair, for example, in this last budget negotiation our net contribution has gone from £3bn to £7bn a year to the EU.

"That's unacceptable, particularly in these difficult times.

"We intend to at least freeze, if not cut it."

He also reiterated the fact that any change to the rebate could result in the UK using its veto.

He said: "Let's be clear about this rebate.

"Disgracefully, when Tony Blair was out there, he gave away a large proportion of the British rebate.

"It's cost us £7bn, for nothing. £7bn of the British rebate was handed away by Blair.

"We can be absolutely certain that this Prime Minister will not hand away our rebate."

During the summit EU leaders will be attempting to agree a seven-year budget which will begin in 2014.

One of the plans on the table, which has been proposed by Herman Van Rompuy, the EU president, would reduce overall spending to within touching distance of what the UK wants.

However, it would also reduce the value of Britain's annual rebate.

Won by Margaret Thatcher in 1984, the system accounts for the fact that Britain receives much less in agricultural subsidies than other European countries.

It is currently worth £3.2bn a year, but Mr Van Rompuy's changes could reduce it by 25%.

This would cost Britain almost £6bn over the next budget round.

British officials have already said that changes agreed in the run-up to expansion could mean the UK gives more, even if the organisation's budget shrinks overall.

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