Once again we are seeing big bold headlines claiming massive increase in the UK’s contribution to the EU budget in 2013. We provide figures and explanations below, but first a reminder of some general points that put these figures in context:
Traditionally, the UK net contributions to the EU budget are less than 1% of UK’s public spending.
While all bigger and richer member states are net contributors, as a contribution per capita the UK is behind countries like Germany, Sweden, the Netherlands or Austria, Finland and Belgium.
Finally, the estimated benefits of EU membership for the UK economy vastly exceed the UK’s gross budget contribution, let alone its net one. You don’t have to take our word for it – the CBI estimates the direct net economic benefits alone at between £62bn and £78bn every year http://www.cbi.org.uk/campaigns/our-global-future/factsheets/factsheet-2-benefits-of-eu-membership-outweigh-costs/
Back to 2013 – the most up-to-date figures available. The best estimate (there are several variations depending on the exact basis for calculation) of the UK net contribution is GBP 6.7 billion (Euro 8.6 billion). This figure – called Operating Budgetary Balance in this interactive table which provides data per year and per member state – is the gross sum the UK puts into the EU budget minus the money that flows back to the UK, whether via government bodies or directly to beneficiaries.
However, taking this indicator for one single year in isolation can also be misleading, because the EU budget works in seven-year cycles with payments traditionally accumulating towards the end of a cycle when programmes and projects come to fruition (2013 was the last year of such a cycle). So a better indication is the average for the 2007-2013 period – GBP 3.8 billion (Euro 4.9 billion) for the UK.
This latest round of media excitement follows the release of figures by the Office of National Statistics (ONS). These ONS figures while accurate do not reflect the full picture, partly because we understand they usually take into account only payments from the EU budget to the UK central and local government sectors. For example, agriculture payments pass through DEFRA so those are counted, as is Cohesion funding that passes through DCLG. But the UK figures usually exclude for example payments from the EU research and innovation programme (traditionally, the UK ranks among the top two beneficiaries of this funding) and from the digital agenda programme to UK universities and SMEs, payments into public private partnerships like the EU Innovative Medicines Initiative or Green Cars scheme or payments from the EU education and training budget to schools and students.
Which all comes to show that – tempting as they are in their simplicity – figures are deceptive unless contextualised.