UK News 16-06-2005 Stalemate Over EU Budget who: Tony Blair what: Refuses to agree to EU budget rebate freeze where: Brussels when: Thursday snippet: The leaders of 25 European countries are meeting in Brussels to discuss the budget for 2007-13, but Britain has refused to agree to their call for its EU budget rebate of £3.2billion to be frozen, says The Guardian. Jean-Claude Juncker, the prime minister of Luxembourg, which currently holds presidency of the EU, is proposing that Britain`s annual rebate "be capped at the current level - thus denying any further payouts when the EU budget grows," explains The Scotsman. But Mr Blair`s official spokesman says that "would cost us between €25 billion and €30 billion". "With European leaders uniting behind demands for a British gesture," says a report by Nicholas Watt in Brussels and Patrick Wintour, "Downing Street stood firm [on Wednesday] as it insisted that the latest offer from Luxembourg was unacceptable." Much of the debate prior to the meeting has hinged on that word: "gesture", which the prime minister picked up on last Friday at a Downing Street press conference where he was joined by the humbled president of the European parliament, Josep Borrell. "Britain has been making a gesture over the past ten years because, even with the British rebate, we have been contributing into Europe two times that of France," said the PM, quoted in The Sun. "Without the rebate, it would have been 15 times as much as France. That is our gesture." The Scotsman`s Fraser Nelson says Tony Blair has taken an "extraordinary gamble" by lashing out against the Common Agricultural Policy (CAP), which, says the prime minister, "makes no sense". "Forty percent of the [EU] budget goes on CAP - which has 5% of the population and less than 2% of the output of the EU," he reminded the media. "If you have a fundamental review of how Europe spends its money, then of course everything then is open to debate," he said. "What is not open to debate is a situation where you go back to Britain being penalised." Publicly there seems little sign of compromise. OIn Sunday, Foreign Secretary Jack Straw said the CAP was "fundamentally distorted" But at a joint press conference with Mr Blair the next day, German chancellor Gerhard Schröder said the agricultural budget was not even on the agenda for Brussels. Two days later, in Paris, Mr Blair reiterated his remarks after a meeting with French president Jacques Chirac and suggested that in light of the recent referenda in the Netherlands and France, the EU`s priority "should be to re-connect the priorities of the EU with the priorities of the people of Europe". "The only issue where agreement seemed likely was that the stalled EU constitution would be shelved indefinitely, says The Evening Standard, "effectively killing it off and averting the need for a referendum in Britain." [... more]

What The Papers Say is delivered to thousands of readers every morning by web, WAP and email. Sign up today!