§ Sir Teddy TaylorTo ask the Chancellor of the Exchequer what inquiries he has made about unauthorised disclosure of a Treasury document on 16 November.
§ Mr. Kenneth ClarkeI assume that the hon. Member is alluding to the "confidential Treasury papers" mentioned inThe Daily Telegraph article of 16 November on the financing of the European Community budget. There was no unauthorised disclosure of any such document. The figure of about £800 million for the increase in the United Kingdom net contribution to the end of the century, quoted in the article, was provided as a normal response to a routine inquiry by an official Treasury press officer. It was wholly consistent with 72W everything that Treasury Ministers have ever said on the subject.
There has never been any secret that the United Kingdom's net contribution to the Community budget is going to rise in cash terms between now and the end of the century, whether or not the Edinburgh settlement is ratified. Growth is shown in the figures in table 11.1 of the Treasury's last departmental report. The trend is, however, obscured by the large annual variations in our net contribution, which make the precise figures for any one year difficult to predict.
Our latest estimate is that the increase in the underlying level of the United Kingdom public sector net contribution—that is, after smoothing out the annual fluctuations—will be about £850 million between 1995 and 1999, from about £2,700 million in 1995 to about £3,550 million in 1999.
This growth is nominal—that is, not real, terms—and results mainly from the effects of (i) inflation, and (ii) real GNP growth. On the assumption that annual inflation and GNP growth will each be 2 ½ per cent. a year on average over this period, the existing own resources ceiling—1.20 per cent. of GNP—would have allowed an increase in own resources of about 22 per cent. in nominal terms between 1995 and 1999, implying an increase of around £600 million in our net contribution. The effect of the Edinburgh future financing settlement, and the EC (Finance) Bill, will be to increase nominal growth in the own resources ceiling to about 29 per cent. over this period.
The cost in cash terms to the United Kingdom of the change resulting from the Edinburgh settlement and the EC (Finance) Bill is estimated to be 175 million in 1995–96 and 1250 million in 1999–2000.
Those figures still look large because they are presented in cash terms for consistency with the rest of our public expenditure arithmetic. But the real scale of the Edinburgh settlement can be seen in the fact that it increased the own resources ceiling, over seven years, by only 7/10.000ths of Community GNP.