Britain’s budget veto could impact Ireland

Britain’s refusal to pay a bill going back more than 12 years and now totalling €2.1bn to the EU’s budget could substantially increase the sum Ireland must pay.

Diplomats and legal experts are working behind the scenes in Brussels to come up with a way to resolve the problem thrown up by British prime minister David Cameron last month.

Nine countries, including Ireland, owe money to the EU budget following agreement on the way each country’s gross national income (GNI) is calculated. However, Britain’s bill is much larger after London’s statistics office resolved an outstanding issue over including charities, NGOs, and other agencies in their GNI.

Cameron has said Britain will not pay but with the December 1 deadline looming, it will be faced with interest payments and eventually be taken to court for breaking the rules.

Finance ministers hope to resolve the issue in Brussels on Friday, when the budget for 2015 needs to be approved and budgets for 2013 amended, which includes refunds to member states. These sums substantially reduce the balancing payment due from the nine countries but if there is no agreement on Britain’s position, this budget may not come into force.

This would mean that 21 countries, rather than nine, would have to make payments which would increase Ireland’s bill from €6.5m to €112.2m, and Britain’s from just over €2bn to €3.6bn.

The figures on which budget payments are made by member states come from statistics offices, which are supposed to be independent of government.

“A solution is not yet there, but it must be a legally sound solution. the situation is unprecedented,” said a senior EU source.

Taoiseach Enda Kenny said following the EU summit on 24 October that Ireland would abide by the law and pay the bill when due.


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