The Hindu : International : Acrimonious exchanges at European Union summit

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Friday, Jun 17, 2005

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International

Acrimonious exchanges at European Union summit

Vaiju Naravane

Differences over budget cuts, financial benefits

PARIS: The European Union's first summit meeting after the historic rejection by France and The Netherlands of the proposed E.U. Constitution Treaty got off to a rocky start in Brussels on Thursday with acrimonious exchanges between Europe's main leaders on the contentious question of the next budget.

Loudly expounded differences over budget cuts and who should give up which benefits threatened to tear the E.U. even further apart, with portentous questions hanging over the Constitution and the political future of Europe.

France has spearheaded the movement for the cancellation of a multi-billion-euro rebate given to Britain in 1984 when that country was in the grip of recession. Today, Britain has one of the healthiest economies in the Union and other member states say the rebate is no longer justified.

Blair firm

Britain Prime Minister Tony Blair has stubbornly refused to budge on the question, saying discussion was possible only if generous farm subsidies received by France and other nations were also placed on the negotiating table. In the face of growing outrage from other states on the rebate, Mr. Blair is under fierce domestic pressure not to budge on the refund. The Right-leaning Times urged Mr Blair to "stick to his guns" when he meets with his European counterparts. British Foreign Secretary Jack Straw warned that London would not be afraid to use its veto to block the E.U. budget if the rebate — won by former British Prime Minister Margaret Thatcher — was under threat.

European leaders had hoped an agreement on the 2007-2013 budget would give them much-needed political momentum to overcome any paralysis after the French and Dutch refusal to ratify the Constitution.

The two crises — the budget row and the turmoil over the Constitution — have unmasked deep differences over the E.U.'s direction, from how it communicates with ordinary Europeans to its plans to enlarge further and even over the future of its single currency, the euro.

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