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Making sense of the 2010 EU budget

What about the "Net Contributors”?

Antwerp, Belgium: First port of call for many goods entering the EU   Antwerp, Belgium: First port of call for many goods entering the EU

For 2010, Germany is expected to contribute most to the financing of the EU general budget with approximately 19.6%, followed by France (18%), Italy (13.9%), the UK (10.4%) and Spain (9.6%).

Budget debates often focus on how much countries give and how much they get back from the EU (their "net contributions"). Inevitably, "discussions" arise where different countries feel they are either paying too much or not receiving as much as they should. The latter can be a particularly vexed point as some EU policies like agriculture and regional policy benefit some countries more than others.

However, contrasting "contributions" with money a country gets back and then presenting a “net balance” is a difficult and controversial exercise. Here's why:

1. Part of the budget is spent on aid (the EU is the world's largest aid donor) or assistance to developing countries and therefore does not "go back" to any EU country.  Also, money used to administer the EU through its institutions does not go back to one country but is for all EU members.

2. Many EU-supported projects are international and the funds go to the country where the project is.

3. EU funds may co-finance the construction of new infrastructure like roads, bridges or tourism handled by a company that is not from that region or country - thereby spreading the benefits.

4. The spread of customs duties (which form part of the EU's revenues): These are levied at the place of entry and also arguably paid by the consumer who buys the product. For example, goods coming into the port of Antwerp in Belgium are then distributed all over the EU and so on.

5. Finally, the EU is by its very nature a community which encompasses solidarity among its members. In the preamble of the founding Treaty it commits members to "strengthen the unity of their economies and to ensure their harmonious development by reducing the differences existing between the various regions…" Therefore many would argue that the redistribution of resources is an intrinsic part of the European project.