Francois Hollande snubs David Cameron over early talks on EU budget deal

French leader fails to turn up at crucial meeting with Prime Minister, Van Rompuy and Merkel

David Cameron clashed with Francois Hollande over the European Union budget as the French President snubbed the Prime Minister by failing to show up at a crucial meeting.

Despite Britain's decision to provide 350 military personnel to support the French intervention in Mali, Mr Hollande ducked out of talks before an EU summit designed to broker a budget deal. He also called for cuts in the annual €3.5bn (£3bn) rebate on the UK's EU contributions that was won by Margaret Thatcher.

The formal start of a Brussels summit to decide EU spending for the 2014-20 period was delayed by almost six hours as Herman Van Rompuy, who chairs it as president of the European Council, called pre-meetings with some of the 27 leaders to try to find an agreement.

Mr Hollande had been due to attend an hour-long session with Mr Van Rompuy, Mr Cameron and Angela Merkel, the German Chancellor. Instead, he met the leaders of Spain, Italy and Poland – a rival group of southern and eastern European nations that all favour a bigger EU budget than Mr Cameron. "President Hollande was unable to attend," a British source said tersely. One observer said: "Hollande is pulling on the other end of the rope to Cameron."

As he arrived at the summit, the Socialist French President clearly had Mr Cameron in his sights. Calling for "a little clarity on rebate cheques" he added: "If someone is not reasonable, I will try to convince him, but only up to a certain point."

Despite what was dubbed "le snub" in Brussels, Mr Cameron claimed progress in his battle to shave tens of billions of euros off the proposed €973bn seven-year budget on which EU leaders had reached deadlock last November. Mr Van Rompuy was expected to cut that to about €960bn when the formal session got under way over dinner. This figure relates to spending commitments on EU programmes. The 27 leaders also had to agree a lower figure on actual payments, dubbed the Union's credit card limit, which could be around €913bn. That would allow Mr Cameron to claim victory since he has called for a cut or freeze on the current budget.

EU sources said there was "no real threat" to the British rebate because Mr Cameron has a veto over a budget deal needing the agreement of all 27 leaders as well as the European Parliament, which is reluctant to endorse deep spending cuts.

British officials insisted Mr Cameron was far from isolated at the summit, saying he was working closely with a group of countries which favour spending restraint. They include the Netherlands, Denmark and Sweden, as well as Germany, which is acting as a peacemaker between the EU's rival "spenders" and "cutters."

Mr Cameron said: "The numbers are much too high. They need to come down – and if they don't come down there won't be a deal". He added: "The EU should not be immune to the sorts of pressure we have to reduce spending, find efficiencies and spend wisely – what we are all doing."

But EU sources claimed Mr Cameron had been rebuffed in his demand for the two budget ceilings to fall below €900bn and in his call for €7bn of cuts in the Brussels bureaucracy.

The leaders were expected to approve €30bn of cuts to the programmes budget proposed last November. They are likely to hit infrastructure projects including cross-border transport schemes and broadband expansion, as well as administrative costs. But some leaders, including Mr Hollande, were keen to preserve measures to boost economic growth.

Mr Cameron's critics accused him of double standards, with one EU diplomat saying: "He will be among the leaders at an economic summit next month calling for measures to revive growth. If they want the ends, they must provide the means."