Labour tightens pressure on Cameron ahead of EU budget talks

David Cameron Dec 2011_Picnik.jpg

The Labour party piled pressure on Prime Minister David Cameron yesterday (29 October) by pushing for an even tougher line on the European Union budget than that proposed by his Conservative party.

Last week, Cameron reiterated a threat to veto any budget deal seen as detrimental to British taxpayers, and demanded a real-terms freeze in EU spending given the financial constraints and budget cuts faced by many European governments.

Now left-leaning Labour has raised the stakes by demanding a cut in real terms.

Many Britons regard the EU as an ineffectual and spendthrift source of bureaucracy and Britain's ties with the 27-member bloc are likely to be a key theme in a national election set for 2015.

The centre-right Conservative vote is already under threat from the UK Independence party, which has surged in popularity in recent months on a pledge to withdraw Britain from the EU.

"Labour will argue against the proposed increase in EU spending and instead support a real-terms cut in the budget," Labour finance spokesman Ed Balls and foreign affairs spokesman Douglas Alexander said in a joint opinion piece in the right-leaning Times newspaper.

Labour has moved clear of the Conservatives in opinion polls since Cameron's party came to power at the head of a coalition government in 2010.

David Lidington, a Conservative and the government's minister for Europe, said Labour had "zero credibility on standing up for Britain in Europe".

"They waved through above inflation increases for both of the multi-year budgets they approved … We won't take any lessons from them about budget negotiation," Lidington said in a statement.

Cameron wants to remain within the EU given that it accounts for about half of British trade. But he has pledged to negotiate a new settlement with Brussels then seek the public's "fresh consent" for the deal, giving no timeline.

Making negotiations more difficult for Cameron are signs of growing irritation in Europe over what some EU leaders regard as British isolationism and opportunist demands at a time when governments are trying to fix the eurozone debt crisis.

In December, Cameron vetoed a European economic and fiscal pact to help the EU's eurozone countries recover from sovereign debt crises that had cast doubt on the 17-member single currency.

"As a result of David Cameron's behaviour, those we used to call friends now ridicule the prime minister in meetings, shut him out of negotiations and bad-mouth him to the press," the Labour spokesmen said in their article.

The European Commission has proposed increasing the EU budget from the current €976 billion to €1.025 trillion for 2014-2020.

The Commission proposals, tabled in June 2011, suggest a radical break from past budgets, which rely massively on national contributions. This time, in a bid to reduce national contributions, the Commission suggested levying new taxes directly.

Options floated by Brussels include an EU VAT, a share of the upcoming EU tax on financial transactions, a charge air transport and a share of auctions from the emissions trading scheme for greenhouse gases.

  • 9 Nov.: ECOFIN meeting to discuss EU budget
  • 22-23 Nov.: Extraordinary summit with the aim of striking a deal on the long-term budget for 2014-2020.

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