27th February 2015
MPs have said chancellor George Osborne claim to have halved the amount of money handed to the European Union is false.
The Treasury Select Committee, which is led by Andrew Tyrie, has disputed Osborne’s claim that the UK would pay just £850 million of its £1.7 billion EU budget surcharge.
However, the rebate to the UK was already factored in and not the outcome of Osborne’s negotiating skills.
While the MPs did not say Osborne mis-led the public by boasting about a cut in the surcharge, they said he should have known how the rebate applied.
The committee said Osborne’s claim was ‘not supported by the facts’ and that it ‘should have been clear’ that Britain would have received an EU rebate. It added that the Treasury’s arguments as to why the rebate may not have automatically applied were ‘unpersuasive’.
However, it did recognise the government’s achievement in avoiding interest charges while extending the payment period for the surcharge.
The UK has received a rebate from the EU since 1984, when it was negotiated by then prime minister Margaret Thatcher. The refund is calculated on changes to national income.
Tyrie said: ‘The suggestion that the £1.7 billion bill demanded by the EU was halved is not supported by published information.
‘The terms of the UK’s rebate calculation are set out in EU law. It should, therefore, have been clear that the rebate would apply. The government got a good deal for the UK by securing an interest-free delay to the EU bill. But by overstating its success on the rebate, it distracted attention from this achievement.’