PM: EU bill must lose billions or there’s no deal

The Prime Minister held a  series of private number-crunching meetings as chairman and European Council president Herman Van Rompuy put back the summit start time in a bid to find a workable budget compromise with a chance of a deal.

The talks eventually got under way last night five hours later than scheduled.

Mr Van Rompuy was due to table figures for a new budget compromise in last night’s meeting, after taking soundings with the waiting leaders.

One early pre-summit gathering involved Mr Cameron, German Chancellor Angela Merkel, Mr Van Rompuy and European Commission President Jose Manuel Barroso.

But French President Francois Hollande, also due to take part, let it be known after the meeting had started that he could not make it. UK officials denied it was a snub, saying Mr Hollande had another meeting to go to.

The British and French leaders last spoke about the EU budget, by phone, last month.

Mr Cameron held separate talks last night with his Dutch, Swedish and Danish counterparts, as other leaders also broke off into groups – roughly splitting along north-south lines – the northern EU countries being most keen on deep EU budget cuts, and the southern member states, who benefit most from budget handouts, less keen.

Last night, commission  officials pointed out that cuts had already been made in the original budget proposal and that the current figure on the table already amounted to a reduction in spending compared with the current seven-year budget period.

But the sheer complexity of the maths and the options – “payment” figures, “commitment” figures, and the choice of base year for the calculations – offers all leaders the chance to emerge with a deal they can “sell” to their domestic audiences. Allowing for current exchange rates, the opening bid on the table amounts to a budget proposal of €913 billion (£778bn) for 2014 to 2020.

With corridor negotiations between various leaders still under way, government sources said Mr Cameron wanted to see a further cut of “tens of billions” off that figure.

One commission official acknowledged that, in place of the €913bn figure the UK delegation “would like to see a number with an eight at the front”.

That would mean a maximum acceptable figure of £766.6bn.

Mr Cameron said: “The numbers are much too high. They need to come down – and if they don’t come down there won’t be a deal. The EU should not be immune to the sorts of pressure we have to reduce spending, find efficiencies and spend wisely – what we are all doing. There is a possible deal to be done – if they (EU leaders) want to do it.”

Mrs Merkel had arrived in Brussels admitting that national positions remained “far apart”.

And Mr Hollande made clear compromise was needed, but made plain that cuts in EU agriculture spending – wanted by the UK, but rejected by France because of huge French benefits – were not on his negotiating agenda.