Merkel blow to PM’s border reforms


Published: Sunday 26th October 2014 by The News Editor

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David Cameron’s hopes of clawing back control over Britain’s borders from the EU have suffered a blow after Angela Merkel spelled out her opposition to fundamental change.

The Prime Minister has indicated he will make reforms to the principle of freedom of movement of workers within the union a “red line” in a mooted renegotiation of the UK’s membership terms.

He is thought to be preparing a manifesto pledge to bring in quotas for low-skilled migrants from the EU. Before the last general election Mr Cameron promised to bring net annual immigration down to the “tens of thousands” but has failed to get anywhere near the target.

But, speaking to the Sunday Times, the German chancellor appeared to dismiss the prospect of radical change.

“Germany will not tamper with the fundamental principles of free movement in the EU,” Mrs Merkel said.

The setback comes after a difficult few days for the PM, which saw him ambushed at a Brussels summit with a demand to pay an extra £1.7 billion into EU coffers.

Mr Cameron responded furiously to the bill, insisting it would not be paid by the deadline of December 1, and warning that the row risked pushing the UK closer to the exit door.

But the European Commission dismissed the objections, saying the contribution revisions were calculated by independent statisticians using a standard formula agreed by all member states. That process varies the fees charged depending on economic performance.

Britain has by far the biggest extra demand, with other countries such as the Netherlands, Italy and even crisis-hit Greece also facing paying more. France and Germany, on the other hand, have had their contributions cut.

Labour has seized on news that British government officials were notified of the surcharge a week before Mr Cameron was informed.

They also questioned why George Osborne and the Treasury failed to realise there was a potential issue earlier in the calculation process – pointing to recent upwards revisions of post-1995 Gross National Income by the UK’s own statistics watchdog.

In a letter to the Chancellor, shadow chief secretary to the Treasury Chris Leslie wrote: “Following the European Council this week and the concern over the increased contribution from the UK Government to the European Union Budget you have serious questions to answer about how long the UK Government has known about the possibility of a higher surcharge for the UK.

“The Office for National Statistics published a report over four months ago detailing the changes made to UK growth figures which it stated were for use in the calculation of a Member State’s contribution to the EU Budget.

“These surcharges are the conclusion of a process launched in 2011 by the European Statistics agency Eurostat, and cited by the ONS in 2012, which was designed to harmonise the GNI calculations for EU nations.”

Mr Leslie demanded to know when Treasury officials first became aware that the process could lead to a higher bill.

He also asked: “When were you made aware of the possibility of a surcharge for the UK emerging from this process?

“Did you or ministers raise with officials either at the ONS, the Treasury, or FCO any concerns about this emerging issue?

“Since the new GNI statistics for 1995 to 2014 were published in May what steps has the Government taken to raise the issue of this potential surcharge with EU partners or the Commission?”

A Treasury spokesman said: “As the PM has said, questions like these are a red herring. They are an attempt to distract from the real issue here – an unjustified demand for 2.1 billion euros which the PM has made clear we will not be paying on December 1.”

Sources suggested the “normal process” of advising ministers had been interrupted by the “unexpected” publication of the figure during the summit.

The level of the demand apparently depended on economic revisions for all member states going back a decade, as well as the amount of funds being returned to countries through grants and other channels.

Published: Sunday 26th October 2014 by The News Editor

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