Blair, however, attacks France (which still wants to keep its CAP subsidies) by saying "Britain has made a bigger gesture to the EU than France has for the last ten years."
Blair rebukes Chirac in row over British rebate
By George Jones, Political Editor
Tony Blair yesterday traded cross-Channel blows with Jacques Chirac, the French president, after deciding to toughen up his defence of the £3 billion-a-year rebate on Britain's contributions to the European Union's budget.
In language reminiscent of the Anglo-French spats when Margaret Thatcher was prime minister, Whitehall sources said Mr Blair was not prepared to take "lectures" from France and Luxembourg, which did much better than Britain out of the EU.
Tony Blair: not prepared to take 'lectures' from France
Mr Blair was stung into action by a demand from Mr Chirac that he should make a "gesture of solidarity for Europe" by giving up Britain's budget rebate. But Blair hit back at rediculous French farming subsidies. Mr Chirac flatly rejected calls for France to give up generous EU farm subsidies.
"We cannot accept a reduction of direct aid to French farmers," Mr Chirac said after talks with Jean-Claude Juncker, the Luxembourg prime minister, and current holder of the EU's rotating presidency.
Mr Blair has made a cut in farm payments a precondition for any renegotiation of the rebate, which was secured by Mrs Thatcher 21 years ago.
The sharp exchanges between the two leaders set the scene for a confrontation over the EU's finances at next week's summit in Brussels.
Mr Blair publicly rebuffed Mr Chirac, saying that without the rebate Britain would be paying a "quite unfair -proportion" of the EU's budget.
"Britain has been making a gesture, because over the past 10 years, even with the British rebate, we have been making a contribution into Europe two and half times that of France. Without the rebate, it would have been 15 times as much. That is our gesture," he said at 10 Downing Street.
Mr Blair said any discussion on future financing had to look at how Europe needed to spend its money to prepare for the 21st century, "which is not the same as Europe 30 or 40 years ago".
In recent weeks, Mr Blair has given conflicting signals on the rebate, appearing to indicate that he was prepared to consider proposals put forward by Mr Juncker to cap the repayment and then gradually phase it out.
Whitehall sources said that during talks following yesterday's Cabinet meeting, the Chancellor, Gordon Brown, persuaded Mr Blair that he had been too defensive and needed to put up a stronger fight to save the rebate. One official said that Mr Blair had agreed to put a positive case for the rebate, adding: "The talks put fire in his belly."
Downing Street later released figures that showed that Britain was the second largest net contributor to the EU after Germany between 1995 to 2003.
After talks in Downing Street with Mr Blair, Anders Fogh Rasmussen, the Danish prime minister, refused to be drawn on whether he believed Britain should give up its special budgetary arrangements. But he said everyone around the table "has to make a gesture" if there was to be a compromise.
Mr Rasmussen called on EU leaders to decide at next week's summit whether the ratification process for the EU constitution should be called off altogether following the no votes in France and the Netherlands.
He said that before Denmark went ahead with its referendum on Sept 27, there had to be a clear message "whether we actually have a treaty to vote on".
Edited by Blackleaf, 10 June 2005 - 08:49 AM.