HC Deb 20 February 1985 vol 73 cc1031-3
82. Mr. Freeman

asked the Secretary of State for Foreign and Commonwealth Affairs what is the most recent estimate of the date by which European Community expenditure could not be met by the present rate of Community receipts, without recourse to an increase in the own resources value added tax rate or supplementary finance.

Mr. Rifkind

Uncertainties surrounding the rate of Community expenditure do not permit a precise estimate of the date by which additional resources will be required. In forwarding the draft 1985 budget to the European Parliament, the Council undertook to meet additional budgetary requirements by 1 October 1985.

Mr. Freeman

If and when the Government come back to the House for authority to increase the net contribution to the Community above the £900 million provided for next year, will he assure us that, first, the Government will consider the relative merits of that increased finance against other means and, secondly, that the House will have an early opportunity to debate the wisdom of that supplementary finance?

Mr. Rifkind

I have no doubt that, if it is necessary to ask the House to approve supplementary finance for this year, the House will have the same very full opportunity as it had recently to express its views. It has been made clear to the other member states that the approval of the House of Commons is required before any additional expenditure can be agreed.

Mr. Deakins

Why has the Community not budgeted to spend within its anticipated income?

Mr. Rifkind

The hon. Gentleman will be aware that there is a conflict of responsibilities within the Community because of the way in which the treaty is drafted. There is a limit on the resources available to it this year, and that is a legal responsibility that it has to accept. There are also certain legal responsibilities to meet the entitlement of private citizens and others who benefit from Community expenditure. It has not been possible to reconcile these two requirements.

Mr. Beaumont-Dark

Will my hon. Friend accept that most right hon. and hon. Members think that there is nothing uncertain about Common Market expenditure and that it will continue to be out of control? May I remind my hon. Friend that the Economic Secretary to the Treasury promised us, almost on the Holy Grail, that we should not be asked for more money? Yet even today we are told that the House will be asked to give more money to the EEC. When shall we get this monstrous organisation under control?

Mr. Rifkind

I read the minutes of the evidence that the Economic Secretary gave to the Committee of which my hon. Friend is a member. I can assure him that the Economic Secretary gave no such assurance. He has gone out of his way, at the Dispatch Box and elsewhere, to say that it may be necessary to have supplementary expenditure this year. Her Majesty's Government have striven more than most to control Community expenditure.

It was because of the Government's efforts that the very substantial new proposals on budgetary discipline were finally agreed by the Community.

83. Mr. Ron Davies

asked the Secretary of State for Foreign and Commonwealth Affairs if the Foreign Affairs Council has considered a further supplementary loan as a way of financing European Economic Community expenditure in the coming year.

Mr. Rifkind

Council discussions are at present continuing about the best way of financing Community expenditure in 1985.

Mr. Davies

I should like to remind the Minister of the precise words of the Economic Secretary to the Treasury on 22 January: I should like to think that supplementary budgets for the European Community would not be a thing of the future"—[Official Report, 22 January 1984; Vol. 71, c. 884.] How can the Minister reconcile that statement with the statement that he has just made? If he is to request the House to approve a further supplementary loan, will he at least guarantee that that loan will not be supported by the Government until the burden of expenditure in the European budget is redirected away from agriculture and towards the reduction of unemployment?

Mr. Rifkind

This is the final year before the new budgetary discipline proposals come into effect. It is for that reason that expenditure that may be incurred by the Community this year has not had the benefit of the control and discipline agreed upon last year at Fontainebleau. Only when the budgetary discipline proposals have come into effect, beginning with the price-fixing discussions on agricultural prices within the next few months, will we be able to judge their effectiveness.

Mr. Budgen

Is it my hon. Friend's estimate that the supplementary finance that will be required for 1985 is likely to be even greater than the £120 million required for 1984?

Mr. Rifkind

The Commission has come forward with certain figures—

Mr. Budgen

Answer the question.

Mr. Rifkind

The Commission has come forward with certain figures which, at the moment, it maintains represent sums that will be due. We have not yet had an opportunity to consider them in detail. If the figures are correct, they represent a larger amount than for the previous year. However, the Government intend to scrutinise very carefully—as they did last year— any proposals by the Commission, in order to see whether the figures are unnecessarily high.

Mr. Healey

The result of all this Government voyeurism—these careful scrutinies—is always to give in to the Community. Does the Minister agree that, as a matter of fact and practice, there is no chance whatever of the Commmunity avoiding bankruptcy this year unless Her Majesty's Government pay over a large part of the rebate owed to us since Fontainebleau?

Mr. Rifkind

If the right hon. Gentleman had done his homework he would have appreciated that on the last occasion when voyeurism—as he so politely describes it —took place, the Commission's proposals were reduced by more than half through the efforts of my hon. Friend the Economic Secretary.

Mr. Healey

The Government have not yet received the money.

Mr. Rifkind

Yet again, the right hon. Gentleman is incorrect. The rebate for the year to which I have just referred was paid and the House was not asked to approve any further proposals until that sum was paid.

Mr. Healey

What about this year?

Mr. Rifkind

At the discussions that have just taken place in the Foreign Affairs Council there was unanimous agreement that that sum has to be paid, in accordance with the provisions of the Fontainebleau summit. Her Majesty's Government are confident that that obligation will be properly satisfied.