EU: Britain would be one of the smallest net contributors to the EU under its budget proposal, according to an analysis by European Commission experts.
This contradicts briefings by British officials, who have argued that the British proposal to pay an extra €8 billion into the EU during 2007-13 would put it on a level playing field with countries such as France and Italy for net contributions.
The officials suggest the proposal would see Britain pay about 0.41 per cent of gross national income (GNI) into the EU budget, while France and Italy would pay 0.4 per cent and 0.44 per cent respectively.
But the commission estimates Britain would pay 0.3 per cent of GNI, below all the other net contributors Austria, Germany, Sweden, Denmark, France, Italy, the Netherlands and Finland.
Ireland will remain a net beneficiary under the proposal for between three to four years but would then become a net contributor to the EU budget for the first time.
The discrepancy between the two sets of figures is based on a long-standing dispute between Britain and the Netherlands, on the one hand, and the 23 other EU states, over the "own resources" part of the budget. This is the agreement between member states that sets out the way by which the money is raised to fund the EU budget.
Both Britain and the Netherlands continue to count customs receipts as part of their national contribution to the EU, while the commission and the other 23 member states regard them as the EU's own revenue. By measuring these elements of the budget in a different way, both camps have come up with separate payment figures into the budget.
An analysis of the three separate budget proposals (see table) shows in which specific areas Britain has proposed making cuts to reduce the overall scale of spending 2007-13.
EU administration spending would be cut by 2 per cent; citizenship spending (health, culture and consumer protection projects) drops 16.7 per cent; Cap, environment and rural development funds fall by 2.7 per cent; and structural funds for growth and employment initiatives fall 4.1 per cent. Meanwhile, structural funding designated for projects to increase competitiveness, foreign missions and the justice portfolios would be left untouched in the proposal.
However, the overall figures mask major cuts in rural development for the original 15 EU states worth €7 billion and a €14 billion cut in structural funds for the new member states.