Cameron-Merkel in 'absolute agreement' on EU budget

Sunday, 31 October 2010 11:00 PM

By Peter Wozniak

David Cameron held talks with German chancellor Angela Merkel today, arguing the two countries were in "absolute agreement" on the EU budget.

During "good and substantive" talks held at Chequers, the prime minister and Ms Merkel discussed matters ranging from Afghanistan to international trade, but the focus was inevitably on the European Council's decision to limit the EU's budget increase to 2.9%.

A Downing Street spokesman said: "There was absolute agreement between the leaders that restraint needed to be shown in EU spending.

"At a time when both Britain and Germany were taking tough steps to control deficits, the EU needed to make its contribution too."

The prime minister's frantic round of diplomacy at the EU summit on Friday secured the agreement of ten countries, including Germany, to scale back the bloc's budget increase from the suggested 5.9% to 2.9%.

Mr Cameron has attempted to balance diplomatic tensions in Europe with fierce domestic opposition to any increase in money sent to Brussels on his own backbenches - whilst trying not to bring the issue to prominence in a Cabinet that includes both pro-European Lib Dems and bitterly Eurosceptic Conservatives.

The prime minister painted the result as a victory - though he had initially called for a complete freeze to the EU budget.

A move by EU leaders to amend the Treaty to Lisbon to allow a fund to tackle crises in the Eurozone was glossed over by the prime minister as not affecting the UK.

Mr Cameron has promised that any change in Britain's constitutional relationship with the EU will require a referendum.

The two leaders also discussed the bomb plot originating from Yemen, stating Britain and Germany would "maintain their close and effective counter-terrorism co-operation".

On Afghanistan, the two countries pledged "steadfast" commitment to the Nato mission, while they called for Iran to return to negotiations over its nuclear programme.

Trade liberalisation also featured, with Mr Cameron and Frau Merkel making a joint announcement for the creation of a commission on boosting global trade, which is scheduled to report early next year.

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• eu budget
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• europe
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• foreign policy