§ Mr. Andrew Smith
To ask the Chancellor of the Exchequer what assessment he has made of the principal reasons for the difference between the projected gross United Kingdom contribution after abatement to the preliminary draft budget of the European Communities for 1995 and the 1994 gross contribution; and what action he is taking on this.
§ Sir John Cope
[holding answer 7 July 1994]: The main reasons are the lower abatement of our VAT contributions in the 1995 preliminary draft budget relative to the 1994 Budget, because our net contribution in 1994 is relatively low; the higher rate of growth in the United Kingdom's economy relative to that of other member states; and the 736W increase proposed by the Commission in the 1995 PDB. The latter is currently under negotiation and will be given First reading by the Budget Council on 25 July.