Government attacks EU budget rise

The Government has criticised an inflation-busting EU budget rise in the face of UK demands for a freeze in line with national austerity measures.

The European Commission is proposing a 4.9% increase in EU spending next year - boosting the euro-budget by £5.5 billion to £117 billion.

A Government spokesman said the UK would fight the plan, insisting: "We want the best deal for the UK taxpayer and a 4.9% increase in the annual EU budget is not acceptable.

"We'll be working closely with other member states to drive the hardest possible bargain."

Europe's budget Commissioner Janusz Lewandowski this afternoon acknowledged his plan faced tough negotiations with national authorities but insisted he had held the increase to what was required to fulfil the Commission's legal and financial obligations.

Britain, France and Germany have been leading calls for national-style spending cuts in an EU budget which the 27 member states pay for.

But the commissioner fired a broadside at member states which he said had a worse savings record than Brussels and yet were now demanding reductions while expecting more from the EU.

"In the last ten years the EU budget has gone up by 37.5%: the average government expenditure in the 27 (EU) countries was up by 62% - and I can give very persuasive national illustrations from the countries which are supposed not to be happy with the growing European budget, about their real fiscal expansion before 2010, producing huge problems and huge deficits".

Mr Lewandowski went on: "There are now some countries with annual deficits bigger than the volume of the European budget and still growing - even the countries which are about austerity as a programme of their political leaders."

He insisted: "We (the Commission) are about a balanced approach, saving whatever may be saved, rigorous in administration and, on the other hand, delivering on jobs and growth and paying our legal and financial obligations".

The commissioner said he was "conscious of the austerity mood" among EU leaders, insisting that before making his 4.9% proposal he had sounded out member states about what was acceptable.

But he said he had also taken the opportunity to explain what was necessary at EU level.

Last year, within weeks of taking office, Chancellor George Osborne called for an EU spending freeze, but had to settle for a 2.9% rise, compared with a 6% increase demanded by some Euro-MPs.

Today Conservative leader in the European Parliament Martin Callanan said: "Last year we saw a 2.9% increase in the EU budget. That was already too high: yet another inflation-busting rise is outrageous.

"There are no end of places where the EU can cut fat. The EU needs to do less, do it better, and cost less."

He went on: "Eurocrats bizarrely seem to think that increased EU spending can offset the cuts being made by national governments.

"They are oblivious to the fact that states and taxpayers cannot afford to fund yet more Europe.

"It is time that we fitted some sort of gastric band to the Commission.

"Every other public sector organisation is tightening its belt and the EU must do the same. Conservative MEPs will not accept an increase in the EU's budget."

Shadow foreign secretary Douglas Alexander backed the Government's stand against an EU rise, commenting: "When national governments are having to make very difficult decisions on public spending, the European Commission's proposal seems ill-judged and unwise.

"As these budget negotiations go forward the priority should be to find savings in the EU budget and refocus spending on the most important areas."

This afternoon the Dutch finance minister pitched in against any rise, warning: "These proposals are out of proportion. I cannot explain to Dutch citizens that the EU-budget continues to increase while we in the member states all have to take a step back.

"I fully understand that also in Brussels in certain areas expenditures will rise, but that means that in other areas expenditures need to be cut. I will, in the near future, do my utmost to achieve a substantially smaller EU budget than what the Commission now has proposed."

With Germany, France and Sweden also joining the UK in the assault on a budget rise, the commissioner is in for a rough ride in the next few months of negotiations.

But Mr Lewandowski insisted: "When we are talking face to face, you can expect some rational argument and some understanding".