Chancellor George Osborne's claim to have halved a £1.7 billion EU surcharge in negotiations in Brussels last year is "not supported by the facts", a report has found.

Labour described the finding by the cross-party Commons Treasury Committee as "damning" and called on Mr Osborne to apologise for what the party's Treasury spokesman Chris Leslie said was a "completely false" claim.

The EU demand, relating to a recalculation of Britain's income dating back almost 20 years, sparked fury when it was issued last October.

But Mr Osborne later declared after a meeting with Ecofin ministers that Britain would pay just £850 million, The report said Mr Osborne's claim the bill had been cut in half was "not supported by the facts", and the Treasury should have known the demand would automatically be cut in half by Britain's regular EU rebate.

The financial framework set out in official EU documents "does not appear to leave a great deal of room for uncertainty" that the rebate would "inevitably" apply, and that "this should have been clear to HM Treasury" as soon as it received the revised figures for gross national income which gave rise to the surcharge.

A Treasury spokesman said: "The deal the Chancellor secured on the surcharge was not a technical clarification, it was a hard fought negotiation that halved the payment and delivered a real result for Britain."