THE BLOG

The Demands for Further Contributions Are Just a Step in the Death of the EU

27/10/2014 11:22 GMT | Updated 25/12/2014 10:59 GMT

We all love a good conspiracy and the press, ever anxious to please its readers, will dig deep for evidence that one exists. How sad it is then that the UK's bill from Brussels for an extra £1,700 million of contributions does not seem to be the result of some fiendish plot by the devious Commission but flows from some sort of accounting adjustment. Mind you, it is all a little odd. No one at the EU or in the press seems to understand the computations which require the British, the Dutch, the Italians and the Greeks to make payments which will ultimately flow to France, Germany and Spain. Truly the workings of the treaty must be byzantine, an inner mystery of the priesthood of European bean counters. Still, innocent of malice though it may be, the demand has caused a row capable of accelerating the UK's slide towards the exit and future historians may find it surprising that seismic political change should flow from a routine piece of administration.

If they think that they will have missed the point. Producing cataclysmic shocks to national finances is something of a specialty at the European Union. Look for example at how the European Court of Justice behaves. It will strike down the laws of member states on the basis that they are not compliant with EU treaties, thus triggering huge compensatory payments to individuals or companies, without so much as a thought to the damage to national exchequers. The decision that the UK's advance corporation tax system was non-compliant in the late 90s resulted in huge transfers of funds from the UK government to multinationals, some of which are still being litigated today. Cases since then have distorted national tax systems in many ways, giving rise to substantial repayments just at a time when the countries concerned are least able to afford it. Indeed so significant are these flows that some firms of professional advisers have units which comb national tax legislation in the hope of finding noncompliance which will generate repayments for their clients.

The trouble is that there is nothing reprehensible in all this. The European Court simply interprets European law as it finds it and those who recomputed the contributions no doubt did their work honestly and by the rules. However the rules are much too complicated. Presumably that is why there hasn't there been a press release from the EU explaining the calculations giving rise to the additional contributions so that everyone can understand why they have arisen; also, there are many too many of them. They have become like an overlong company prospectus where, if something goes wrong, you are told that you should have read the small print on page 210.

What a disappointment it all is. Those of us who campaigned for membership of the European Community in the 1975 referendum imagined something quite different; it would be a trading bloc which would use its economics weight, to be sure, but inevitably it would morph into a new form of superpower. A constitutional hedgehog, all the spikes would be on the outside. It would use its economic, diplomatic and military might to assert its place in the world whilst internally it would be liberal and easy going, somewhere where nations could be themselves subject only to those few rules which were realistically required to protect freedom of trade and movement.

Well it hasn't worked out like that, has it? As the grip of its bureaucracy tightens the EU has become addicted to rules and nobody would be foolish enough now to entrust it with weaponry. Its most recent foray into national diplomacy lead to the disaster in the Ukraine. No, it is like a tree dying, sinking slowly under the ivy of its own bureaucracy. The mess over the budget demands is simply a stage in that process and should be recognised as such but understanding its nature won't be much help. It has all gone too far now and it is way beyond the reforming zeal of Mr Cameron and his friends to put right. If we want to realise the original dream we will have to burn the tree down and start again.