Germany wants its money back

Germany and the Netherlands have told other European governments they want their money back.

Theo Waigel, the German finance minister used the first round of talks on what will happen to EU finances as the bloc expands into Eastern Europe, to fire the opening shots in what promises to become a bitter row. He was backed by Gerrit Zalm, the Dutch minister who went so far as to threaten to veto enlargement if the net contributors to the pounds 60bn annual budget are not given a fairer deal.

The move threatens the special budget rebate won by Margaret Thatcher for Britain in 1984 when she shocked fellow EU leaders by thumping the table and demanding that the UK, one of the smallest direct beneficiaries of EU handouts, should have its cash returned. Clearly concerned that Britain's rebate could now come under scrutiny, Gordon Brown, the Chancellor, called instead at the weekend for a radical reduction in spending on agriculture. "The debate must start to focus on whether money is being properly used," he said.

Spain, Greece and Ireland, which receive several times more in direct aid than they put into the EU budget, accused the Germans and Dutch of calling into question the solidarity principle on which the EU is founded. Charlie Mc Creevy, Ireland's finance minister, said the Union would cease to exist if every member state wanted back exactly what it put into the budget.

Germany, for years the EU's paymaster, contributes around 25 per cent of the total budget based on a formula under which member states pay in up to 1.27 per cent of their GDP. German reunification led to a big increase in the size of German GDP and a corresponding increase in its EU dues. Among the net contributors, Germany claims to pay around 60 per cent of the bills.

Now, desperate to slash the country's huge public deficit in time to qualify for monetary union in 1999, Bonn is casting around for every last pfennig.

Mr Zalm, meanwhile, who insists his country is not even among the five richest EU nations, circulated figures at the meeting claiming the Netherlands pays most in terms of per capita income. But the Dutch figures were dismissed by officials from poorer countries as "lies" because they include millions of pounds in customs duties which the Netherlands, one of the EU's biggest transit countries, receives on imports destined for other countries.

Germany and the Netherlands have enlisted support from newcomer Sweden which also wants a root-and-branch budget reform.

But Jacques Santer, the EU Commission President, reminded the bigger countries that the benefits or costs of membership of the EU could not be quantified purely in terms of the budget. The modernisation of Athens airport, he pointed out, was paid for out of the EU's regional fund but the construction contracts went to Dutch and German firms.

Mr Santer has now promised to bring forward an objective assessment of each country's payments and receipts from the Brussels budget.

Suggested Topics
Start your day with The Independent, sign up for daily news emails
Have you tried new the Independent Digital Edition apps?
News
ebookA unique anthology of reporting and analysis of a crucial period of history
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Guru Careers: Software Developer / Web Developer

£30 - 40k + Benefits: Guru Careers: A Software / Web Developer (PHP / MYSQL) i...

Guru Careers: Account Executive

£18 - 20k + Benefits: Guru Careers: An Account Executive is needed to join one...

Guru Careers: Software Developer / Software Engineer

£35 - 40k + Benefits: Guru Careers: A Software Developer / Software Engineer i...

Reach Volunteering: Volunteer Trustee with Healthcare expertise

Voluntary and unpaid, reasonable expenses are reimbursable: Reach Volunteering...

Day In a Page

Raif Badawi: Wife pleads for fresh EU help as Saudi blogger's health worsens

Please save my husband

As the health of blogger Raif Badawi worsens in prison, his wife urges EU governments to put pressure on the Saudi Arabian royal family to allow her husband to join his family in Canada
Birthplace of Arab Spring in turmoil as angry Tunisians stage massive sit-in over lack of development

They shall not be moved: jobless protesters bring Tunisia to a halt

A former North African boom town is wasting away while its unemployed citizens stick steadfastly to their sit-in
David Hasselhoff's new show 'Hoff the Record': What's it like working with a superstar?

Hanging with the Hoff

Working with David Hasselhoff on his new TV series was an education for Ella Smith
Can Dubai's Design District 'hipster village' attract the right type of goatee-wearing individualist?

Hipsters of Arabia

Can Dubai’s ‘creative village’ attract the right type of goatee-wearing individualist?
The cult of Roger Federer: What is it that inspires such obsessive devotion?

The cult of Roger Federer

What is it that inspires such obsessive devotion?
Kuala Lumpur's street food: Not a 'scene', more a way of life

Malaysian munchies

With new flights, the amazing street food of Kuala Lumpur just got more accessible
10 best festival beauty

Mud guards: 10 best festival beauty

Whether you're off to the Isle of Wight, Glastonbury or a local music event, we've found the products to help you
Unai Emery’s passion for winning and eye for a bargain keep Seville centre stage in Europe

A Different League

Unai Emery’s passion for winning and eye for a bargain keep Seville centre stage in Europe, says Pete Jenson
Amir Khan and James DeGale’s remarkable Olympic performances were just the start of an extraordinary journey - Steve Bunce

Steve Bunce on Boxing

Amir Khan and James DeGale’s remarkable Olympic performances were just the start of an extraordinary journey
Abuse - and the hell that came afterwards

Abuse - and the hell that follows

James Rhodes on the extraordinary legal battle to publish his memoir
Why we need a 'tranquility map' of England, according to campaigners

It's oh so quiet!

The case for a 'tranquility map' of England
'Timeless fashion': It may be a paradox, but the industry loves it

'Timeless fashion'

It may be a paradox, but the industry loves it
If the West needs a bridge to the 'moderates' inside Isis, maybe we could have done with Osama bin Laden staying alive after all

Could have done with Osama bin Laden staying alive?

Robert Fisk on the Fountainheads of World Evil in 2011 - and 2015
New exhibition celebrates the evolution of swimwear

Evolution of swimwear

From bathing dresses in the twenties to modern bikinis
Sun, sex and an anthropological study: One British academic's summer of hell in Magaluf

Sun, sex and an anthropological study

One academic’s summer of hell in Magaluf