Europe bills the UK another £34 billion

Europe has another massive hole in its funding, and the UK is going to be called on to pay tens of billions of pounds in order to fill it. The news comes hot on the heels of a £1.7 billion demand from Brussels earlier this month, and is bound to lead to yet more discussions as to whether Britain is better off in or out of Europe.

When we faced a surprise £1.7 billion bill earlier this month, the size of the demand (which later had Britain's rebate applied to bring it down to £850 million) was considered big enough to persuade many to consider life outside European Union. David Cameron said in a press office at the time: "'When you are presented with a bill like this, with a month to go, is that helpful for Britain's membership of the European Union, no it certainly is not."

The Eurosceptics are going to be shouting even louder with news of a vastly bigger bill on the horizon. Already prominent sceptics like John Redwood and Jacob Rees-Mogg have been lining up to denounce the demands for extra money as being a sign of a European culture which thinks it can help itself to as much cash as it wants at any time.

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Why?

The problem is that auditors have calculated that the EU will have a £259 billion shortfall by 2020. This is a shortage of cash to pay for things that the EU has promised and is legally obliged to deliver.

Between now and then the member states are going to have to make up the shortfall, and Britain's share of that would work out at almost £34 billion. It would mean we contribute £13 billion a year for the next six years - which is even more than the record £11.3 billion paid to Europe last year.
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Can we afford it?

This will come not just as a political blow to the government, but an enormous financial one. Recent figures have revealed that the government is borrowing far more money than it ever anticipated at this stage in the financial cycle. Despite the economic recovery so far, borrowing reached £58 billion in the first half of the financial year - which is 10% more than last year - and a long way from the 12% drop George Osborne forecast.

We're already borrowing about £2 billion a week to make ends meet, and adding in the extra payments to Brussels is not going to make those figures look any better. The government that was elected on a promise of delivering sound financial balancing of the books is going to be left with an awful lot of explaining to do.

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