§ Rachel Squire
To ask the Chancellor of the Exchequer if he will review the rules which reduce the amount of UK grants and funds awarded to the Particle Physics and Astronomy Research Council when it gains additional EU funding. 
§ Ruth Kelly
[holding answer 7 May 2003]Government policy is that UK public spending financed from the EC Budget is subject to normal public sector budgeting rules. This reflects the fact that UK taxpayers have an interest in spending on programmes funded from the EC Budget being spent in a way which is consistent with national priorities.
Departments have therefore in general needed budgetary cover for spending funded from the EC Budget, including spending on research and development. To improve incentives, however, a recent review has resulted in changes to the public sector budgeting rules, so that from 2003–04 departments which receive income from the EC Budget for commercially- or competitively-let research contracts will be able to offset half of their income from qualifying programmes against spending within their departmental expenditure limit.