EU could ask Britain for MORE cash to compensate for pound falling in value
THE European Union (EU) could ask Britain to stump up MORE cash to plug the gap left due to the fall in the value of the pound after Brexit.
Britain could be asked for more cash from the EU
The UK already pumps around £18 billion a year into the EU but sterling’s post-Brexit depreciation means there will be a shortfall in the bloc’s coffers.
Talks on next year’s budget are about to get under way and German negotiator Jens Geier has warned member states the books will have to be balanced one way or another.
Mr Geier said the “unforeseeable situation” meant EU leaders would have to decide between “three very unpleasant possibilities”.
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German MEP Jens Geier has warned Britain might have to plug a financial gap in the EU budget
One is to ask the British government for more money. I don’t think this would get a positive reception
He said: "There has already been an unforeseeable situation and now we have to deal with this problem.
“The interesting question is, how will the governments in the Council cope with this situation? They now have to decide between three very unpleasant possibilities.
“One is to ask the British government for more money. I don’t think that this would get a positive reception."
The weaker pound has led to a shortfall in EU coffers
He continued: “Secondly, they can ask other member states to contribute more so that we can balance this artificial deficit created by the depreciation of the pound. This probably won’t be welcomed by the member states.
“The third possibility is what I would prefer. There’s a lot of money coming into the budget for example from fines and normally we’re not allowed to use this money. It’s only collected and then given back to the member states at a later stage. We could use these fines in order to cover this money.”
Mr Geier is proposing a £143.9billion (€161.8bn) budget which is £3.67bn (€4.13bn) more than the original Commission proposal and also higher than the £140bn (€157.4bn) suggested this time last year.
The value of the pound has fallen since the Brexit vote
He said: “Last year we had two crises in Europe: the migration and economic crises.
“The situation is no better than last year and we are trying to learn a lesson from Brexit. People want to see Europe deliver and we can’t do more all the time with less money.
“This means that we need to show that the Parliament is dedicated to doing more to tackle these issues.”