§ Mr. Wheeler
asked the Chancellor of the Exchequer if he will make a statement about the European Commission's latest cash position and the implications for the United Kingdom.
§ Mr. Brooke
The European Commission estimated that its spending obligations in July would again exceed available revenues under the budget for 1987.
The Commission has therefore requested member states to advance from August into July the payment of own resources other than VAT in accordance with article 10(2) of Council Regulation 2891/77; a similar advance was made last month. The Government are satisfied that this request is within the vires of Article 10(2) and accordingly made an advance payment today, 20 July, of £147 million from the Consolidated Fund under section 2(3) of the European Communities Act 1972. The payment of levies and duties on 20 August will be reduced by the amount of the advance.
The Commission has also informed us that it has had to overdraw its accounts with member states in July in accordance with article 12(2) of Council Regulation 2891/77.76W
The amount involved for the United Kingdom is expected to be of the order of £206 million. The Government are meeting this obligation from the Consolidated Fund in accordance with section 2(3) of the European Communities Act 1972. Repayment of drawings made under this facility will be made by deduction from subsequent own resources payments. Neither of these facilities involves increasing the total amounts which the Community is authorised to spend during 1987. There is therefore no net addition to public expenditure.