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European Community (Budget Contribution)

Volume 17: debated on Sunday 11 April 1982

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8.

asked the Chancellor of the Exchequer what recent progress has been made in the negotiations between the Finance Ministers of the European Economic Community with regard to the United Kingdom's budget contribution.

The Community's Finance Ministers have not discussed the problem of net budget contributions since the autumn. My right hon. Friend the Lord Privy Seal told the House on 27 January about the latest discussions between Foreign Ministers.

I thank my hon. Friend for that reply, but is he aware that there is an increasing sense of grievance and dissatisfaction among the British people about our contribution to the European budget? They know that the European Community has not yet repaid to this country money that is owed to us, and that if it had that money would be available to reduce public borrowing and help British industry to reduce unemployment and stimulate investment.

Whatever may have been true before the Government came to office, enormous progress has been made in this respect recently. The Commission estimates that in 1980 our net contribution was some £200 million only, and in 1981 some £55 million only, so my hon. Friend cannot take the Government to task for that. Judging by present demands, those sums would not be adequate for those who believe that there should be a massive reflation of British industry.

Yes, but what will be the situation at the end of this year if no agreement is reached by then?

The provisions of the 30 May agreement will apply to the calendar year 1982 if there is no agreement. It is impossible to know the net cost of our contribution in those circumstances until we know the world agriculture prices and many factors that have not yet been determined.