European Union structural and cohesion funds will be cut unless member-states agree a new way of financing the EU, according to the German Chancellor, Mr Gerhard Schroder. In an interview to be published in the news magazine Der Spiegel today, Mr Schroder said any reform of EU finances agreed during the next six months must include a substantial cut in Germany's budget contribution.
"All ideas that could ease our burden must remain on the table: national co-financing of agriculture policy, limiting real spending, the reform of agricultural policy and Britain's budget rebate," he said.
The Chancellor insisted the EU budget should not grow faster than the average national budget. He warned that failure to agree a new concept for financing the EU could create "difficulties" with the structural and cohesion funds that benefit poorer member-states, including Ireland.
Signalling a clear departure from the policy of his predecessor, Dr Helmut Kohl, the Chancellor said it was time Germany's partners realised the days of "chequebook diplomacy" were over.
"In the past, compromises were often reached because the Germans paid for them. This policy has come to an end," he said.
Germany hopes to complete negotiations on the Agenda 2000 package of reforms before the end of March and to agree a job-creation pact for Europe by the time its Presidency ends in June. Mr Schroder repeated his determination to link the timetable for accepting new EU members from central and eastern Europe to a cut in Germany's net budget contribution.
"If we don't succeed during the German Presidency in arranging financial relationships in such a way that enlargement remains objectively possible, then the date of enlargement will be postponed."
The leader of the opposition Christian Democrats, Mr Wolfgang Schauble, criticised what he called the Chancellor's bluster and arrogance and condemned as disgraceful the decision of the Finance Minister, Mr Oskar Lafontaine, not to attend a ministerial meeting to determine the value of the euro in Brussels on New Year's Eve.
"That was the worst possible start to the German EU Presidency," he said.
