HC Deb 11 June 1979 vol 968 cc150-1W
Mr. Michael Shaw

asked the Chancellor of the Exchequer (1) whether the United Kingdom will receive a payment out of the Community budget correcting mechanism in 1980; and, if so, what is the likely amount involved;

(2) in what years, and to what extent, the United Kingdom has met each of the qualifying criteria for payments under the Community budget correcting mechanism; and which of the further limitations relating to gross national product share and to the current account being in surplus were operative.

Mr. Lawson,

pursuant to his reply [Official Report, 25 May 1979; Vol. 967, c. 303–4], gave the following answer:

An application for a refund under the financial mechanism regulation has been made in respect of the 1979 Community budget. The gross refund due in 1980 is estimated to be about £45 million. After allowing for our contribution to it through the budget, the net refund is likely to be between £35 million and £40 million.

1979 is the first year when the United Kingdom has met each of the qualifying criteria for refunds under the financial mechanism regulation (EEC) No. 1172/76. The extent to which these criteria have been met is as follows: Article 2(a): per capita GNP of the United Kingdom as a percentage of the average per capita GNP for the Community was 72 per cent. compared with the criterion of 85 per cent. Article 2(b): growth rate of per capita GNP in real terms of the United Kingdom as a percentage of the average rate for the Community was 88 per cent. compared with the criterion of 120 per cent. Article 2(c): the United Kingdom contribution on an own resources basis was 11 per cent. higher than the hypothetical contribution based on the United Kingdom share of Community GNP, compared with the criterion of 10 per cent. In previous years the United Kingdom has failed to meet this criterion and has therefore not qualified for a refund. Our claim in respect of the 1979 Community budget is unaffected by any of the limitations laid down in the regulation. This includes the important balance of payments limitation which has the effect of reducing a member State's gross refund very considerably or even entirely if, in aggregate over the three years preceding the year of claim, its balance of payments current account has been in surplus.