EU tells UK to pay extra £1.7bn after 'increase in wealth'

clock

The UK has been told to contribute an extra £1.7bn (€2.1bn) to the European Union's budget after the economy performed better than expected.

The EU is asking for the payment after a revised calculation of how much each member state must contribute, based on gross national incomes, the BBC reports.

The payment adds a fifth to the UK's annual net contribution of £8.6bn. It is based on a review of the UK's economic performance since 1995, and the pace of growth over the last four years.

A European Commission spokesman described the payment as a result of the UK's "increase in wealth" and likened it to a tax payment. 

But the additional payment comes at a time when the government is under pressure from eurosceptics. Earlier this month, Conservative defector Douglas Carswell won a by-election for anti-EU party UKIP in Clacton. Some fund managers have already outlined concerns of political risk as the election looms.

Prime minister David Cameron is meeting other EU leaders for a summit in Brussels. A government source told the BBC: "It is not acceptable to just change the fees for previous years and demand them back at a moment's notice.

"The European Commission was not expecting this money and does not need this money and we will work with other countries similarly affected to do all we can to challenge this."

More on Investment

Partner Insight:  Bonds look as attractive as ever. Being nimble will be key

Partner Insight: Bonds look as attractive as ever. Being nimble will be key

Aegon Asset Management
clock 13 November 2024 • 2 min read
Partner Insight: Niches - Searching for roads less travelled

Partner Insight: Niches - Searching for roads less travelled

In this article, Richard Perrott from the MSIM’s International Equity Team, explains the team’s approach to finding potential investment opportunities within unexpected areas.

Richard Perrott, Executive Director International Equity Team @ MSIM
clock 12 November 2024 • 4 min read
Partner Insight: Deciphering liquidity - Understanding the mechanics of new funds investing in private markets.

Partner Insight: Deciphering liquidity - Understanding the mechanics of new funds investing in private markets.

As more private investors choose to allocate to private markets, Peter Sankey, Product Manager, Private Assets at Schroders sheds light on how the liquidity mechanisms of new fund structures work

Peter Sankey, Product Manager, Private Assets at Schroders
clock 12 November 2024 • 4 min read
Trustpilot