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UK rebate
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The UK rebate (or UK correction) is a financial mechanism that reduces the United Kingdom's contribution to the EU budget in effect since 1985. It is a complex calculation which equates to approximately 66% of the UK's net contribution – the amount paid by the UK into the EU budget less EU expenditure in the UK.[1][not in citation given] Based on a net contribution of €12.1 billion (£9.8 billion) in 2014, the UK Treasury estimates the 2015 rebate amounted to €6.2 billion (£4.9 billion), reducing the ultimate UK contribution for the 2015 budget to €16.6 billion (£12.9 billion).[2] Although the rebate is not set in the EU treaties, it is negotiated as part of the Multiannual Financial Framework (MFF) every seven years and must be unanimously agreed.[3]
Contents
[hide]
1 History
2 Calculation and mechanics
3 Pressure for change
4 See also
5 References
6 External links
History[edit]
In April 1970 the six founding member states of the then European Communities (EC) adopted the so-called 'own resources system'[4] as the means of funding the EC budget. Under this system, revenues were to flow automatically to the EC budget rather than through agreement of the national parliaments, as had been the case until then, and calculated based on three elements:
Customs duties collected on imports from the rest of the world
Agricultural resources
VAT base.
As the UK’s VAT base in comparison with gross national product (GNP) was proportionally higher than in other member states, and the UK was more open than other member states to trade with non-EC countries, this system implied a disproportionate contribution by the UK when it joined the EEC in 1973. Additionally, the fact that around 70 per cent of the EC budget[5] was used to finance the Common Agricultural Policy (CAP), and that the UK had a small agricultural sector meant that the UK gained few receipts under the EEC's redistributive policies.
To address this, at the Fontainebleau European Council in June 1984 Prime Minister Margaret Thatcher successfully negotiated the UK Rebate which was adopted in the May 1985 European Council decision.[1] It has been in place ever since.
In 2005, Prime Minister Tony Blair agreed to exclude from the calculation most enlargement-related expenditure (with a progressive phasing-in of the change from 2009 onwards), so as to contribute to the financing of the enlargements to the European Union,[6] with the accession of Central and Eastern European states, that the country itself had strongly supported. The objective was to address what was widely perceived as an unfair effect of the rebate, since the original mechanism would have resulted in the UK contributing little to the costs of enlargement. These changes were adopted in the June 2007 European Council decision.[7]
Calculation and mechanics[edit]
Calculating the size of the UK's annual rebate is complex.[8] Broadly, the UK gets back 66% of the difference between its share of member states' VAT contributions and its share of EU spending in return. The European Commission sets out the detailed calculations in a working document.[9]
The calculation of the rebate for any one year is budgeted and paid for the following year, and the payments are subject to revision for up to three further years.[10][11] There is no transfer of money from the European Commission to the UK Treasury involved; the effect of the rebate is to reduce the size of the UK's payments.[12]
The effect of the rebate is to increase contributions required from all other member states, to make up the loss from the overall budget. Germany, the Netherlands, Sweden and Austria all have their contribution to make up for the rebate capped to 25% of the figure which would otherwise apply.[13]
Pressure for change[edit]
This article is written like a personal reflection or opinion essay that states a Wikipedia editor's personal feelings about a topic. Please help improve it by rewriting it in an encyclopedic style. (June 2016) (Learn how and when to remove this template message)
There has been growing pressure in recent years from various EU member states for the rebate to be scrapped. This is partly because the recent additional member states of the EU, which are considerably poorer than the fifteen pre-2004 states, will be a considerable expense on the CAP and the EU budget in general. The view is put forward by many that this makes the UK rebate harder to accommodate within the EU budget, leveraged with the moral argument that all the new entrants are substantially poorer than the UK. The new entrants, however, are likely to be net recipients of EU funds and not net contributors like the UK and only Germany will make a larger contribution to these poorer entrants.[citation needed]
The rebate distorts UK funding negotiations with the EU. Normally, countries and independent agencies within each country bid to receive central EU funds. The UK government is aware that two-thirds of any EU funding will in effect be deducted from the rebate and come out of UK government funds. Thus the UK has only a one-third incentive to apply for EU funds. Other countries, whose contributions into the budget are not affected by funds they receive back, have no incentive to moderate their requests for funds.
Furthermore, many EU grants are conditional on the recipient finding a proportion of funding from local sources, frequently national or local government. This increases the proportion coming from UK government revenue even further. This has the effect of artificially reducing EU expenditure returning to the UK and worsening the deficit which the rebate is intended to redress.
The British government has resisted campaigns to abolish the rebate and the UK has a veto on any decision by the EU to do so. Former Prime Minister Tony Blair said that he would veto any attempt to scrap the rebate. He was supported by many in his Cabinet and by the main opposition party, the Conservatives, as well as the majority of the British public.[14] Supporters of the rebate argue that the distortion created by the rebate is minor compared to that created by the Common Agricultural Policy, which is expensive and has implications for free and fair trade in the EU. In addition, they point out that without the rebate, the UK would pay much more into the EU than comparably wealthy countries like France, due to structural differences between their economies.
As of 2004[update], France gets more than twice as much CAP funds as the UK (22% of total funds compared to the UK's 9%) which in cash terms is a net benefit that France gets over and above what the UK gets from the CAP of €6.37bn.[15] In comparison, the UK budget rebate for 2005 was scheduled to be approx €5.5bn. Agricultural expenditure for new member states is included in the 'other' segment of the graph. This was limited in 2004 to 25% of payment rates applying to existing member states, rising to 30% in 2005 and 100% in 2013. Total CAP expenditure is capped, so in the absence of further changes, payments to all the pre-2004 member countries will fall by 5% over this period.[16] Some commentators claim that to a large extent, France gets twice the CAP payment received by the UK because it has twice the amount of farmland, although the extent to which there is a correlation between the two is disputed.[17][18]
The underlying reason why the UK insists on retaining its rebate is that if it were reduced with no change to the CAP, then in its view the UK would be subsidising an inefficient French farming sector. However, France itself remains a net payer to the EU budget, contributing €9.05 billion more than it received in 2013.[19]
If the rebate were removed without changes to the CAP then the UK would pay a larger net contribution than France. The UK would make a net contribution of approximately €10bn compared to the current contribution of €3.86bn, versus a current French net contribution of €6.46bn.[20] Germany has a GDP approximately 25% higher than either France or the UK, but per capita income is comparable to the other two countries. France technically makes a net contribution to the EU budget about twice that of the UK,[20] and is the greatest contributor towards the UK rebate, which means it would benefit most from its abolition. It should be noted however that if France were not required to contribute towards the rebate it would still contribute more to the EU budget than the UK.
These contrasting positions led to deadlock at the June 2005 EU budget negotiations in Brussels. France and other states demanded the abolition of the UK rebate at this meeting. Britain dismissed this as a diplomatic manoeuvre by France to save face after their rejection of the European Constitution in a referendum two weeks before the meeting. The UK made CAP reform a prerequisite of removal of the rebate, a proposal their opponents rejected. The negotiations thus ended without an agreement being reached. In December 2005 the UK Prime Minister Tony Blair agreed to give up approximately 20% of the rebate for the period 2007–2013, on condition that the funds did not contribute to CAP payments, were matched by contributions from other countries and were only for the new member states. Spending on the CAP remained fixed, as had previously been agreed. Overall, this reduced the proportion of the budget spent on the CAP. It was agreed that the European Commission should conduct a full review of all EU spending.[21][22]
The planned withdrawal of the UK from the EU has led to renewed discussion of scrapping of the rebates, with European Commissioner for Budget and Human Resources Günther Oettinger stating that "I want to propose a budget framework that does not only do without the mother of all rebates [the U.K.’s] but without all of its children as well".[23]
See also[edit]
Budget of the European Union
Economy of the European Union
Economy of the United Kingdom
Sapir Report – a 2003 European Commission sponsored report recommending the transfer of EU expenditure toward wealth creation and cohesion, and away from the CAP.[24]
References[edit]
^ Jump up to: a b "85/257/EEC, Euratom: Council Decision of 7 May 1985 on the Communities' system of own resources". EUR-Lex. Retrieved 14 May 2016.
Jump up ^ "European Union Finances 2015: statement on the 2015 EU Budget and measures to counter fraud and financial mismanagement" (PDF). HM Treasury. Retrieved 14 May 2016.
Jump up ^ "Reality Check: How vulnerable is the UK's rebate?". BBC News. 19 April 2016. Retrieved 14 May 2016.
Jump up ^ "EUR-Lex document: 'Own resources mechanism'". 4 September 2007. Retrieved 14 May 2016.
Jump up ^ "The Common Agricultural Policy – a Story to be Continued" (PDF). Publications office of the European Union. 2012.
Jump up ^ "Reuters footage". ITN Source archive. Reuters. 16 December 2005. Retrieved 26 January 2013. Blair is under pressure to yield on the rebate won by his predecessor Margaret Thatcher in 1984 to reflect the fact that Britain, then the EU's second poorest member, benefited little from farm subsidies.
Jump up ^ "Council decision, of 7 June 2007, on the Communities' system of own resources". Official Journal of the European Communities. 7 June 2007. Retrieved 14 May 2016.
Jump up ^ "Financial management of the European Union budget in 2014: a briefing for the Committee of Public Accounts" (PDF). National Audit Office. pp. 6; 63. Retrieved 14 May 2016.
Jump up ^ "Commission Working Document". European Commission. 14 May 2014. pp. 3; 10. Retrieved 14 May 2016.
Jump up ^ "The UK 'rebate' on the EU budget" (PDF). European Parliament. pp. 4; 12. Retrieved 14 May 2016.
Jump up ^ "European Union Finances 2015" (PDF). HM Treasury. pp. 37; 58. Retrieved 14 May 2016.
Jump up ^ "European Union Finances 2015" (PDF). HM Treasury. pp. 38; 58. Retrieved 14 May 2016.
Jump up ^ "The EU's own resources". European Commission. Retrieved 14 May 2016.
Jump up ^ "Press Releases: Open Europe responds to new EU budget proposal". Open Europe. 14 December 2005. Retrieved 20 October 2011.
Jump up ^ "Q&A: Common Agricultural Policy". BBC News. 20 November 2008. Retrieved 26 May 2010.
Jump up ^ "Q&A: The UK budget rebate". BBC News. 23 December 2005. Retrieved 26 May 2010.
Jump up ^ "Home" (PDF). Irri.org. 16 August 2011. Retrieved 18 October 2013.
Jump up ^ [1] Archived 6 February 2007 at the Wayback Machine.
Jump up ^ Chan, Szu Ping (14 November 2014). "EU budget: what you need to know". The Daily Telegraph. Retrieved 27 June 2016.
^ Jump up to: a b Data from different standpoints (absolute, per capita, as proportion of GDP) Nicolaus Heinen (11 May 2011). "EU net contributor or net recipient: Just a matter of your standpoint?" (PDF). Deutsche Bank Research. Retrieved 31 December 2011.
Explanation without the data tables: Nicolaus Heinen (18 May 2011). "EU net contributor or net recipient: Just a matter of your standpoint?" (PDF). Deutsche Bank Research. Retrieved 15 December 2011.
Jump up ^ "Key points of the EU budget deal". BBC News. 17 December 2005. Retrieved 26 May 2010.
Jump up ^ http://ue.eu.int/ueDocs/cms_Data/docs/pressData/en/misc/87677.pdf
Jump up ^ DELCKER, JANOSCH (2017-01-06). "Oettinger wants to scrap all rebates in post-Brexit EU budget". Retrieved 2017-09-24.
Jump up ^ An Agenda for a Growing Europe – Making the EU Economic System Deliver Archived 28 September 2006 at the Wayback Machine.
External links[edit]
BBC On This Day Story
The Economist article on EU Budget reform
BBC News: Q&A: UK Rebate
BBC News: EU says UK rebate 'not justified'
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Treaty of Rome
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UK rebate
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Counterweight
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For the Outer Limits episode, see Counterweight (The Outer Limits).
Simple Crane
A counterweight is a weight that, by exerting an opposite force, provides balance and stability of a mechanical system.[1] Its purpose is to make lifting the load more efficient, which saves energy and is less taxing on the lifting machine.[2]
Counterweights are often used in traction lifts (elevators), cranes and funfair rides. In these applications, the expected load multiplied by the distance that load will be spaced from the central support (called the "tipping point") must be equal to the counterweight's mass times its distance from the tipping point in order to prevent over-balancing either side. This distance times mass is called the load moment.[3]
A counterbalance is a weight or force that balances or offsets another as when two objects of equal weight, power, or influence are acting in opposition to each other. The objects are then said to be in counterbalance.
Counterweights in action[edit]
Trebuchet: There are five major components of a trebuchet: beam, counterweight, frame, guide chute, and sling. After the counterweight drops from a platform on the frame, gravity pulls the counterweight and pivots the beam. Without the counterweight, the beam could not complete the arc that allows the sling to accurately release the projectile.[4][5]
Crankshaft: A counterweight is also used in many rotating systems to reduce vibrations due to imbalances in the rotating assembly. A typical example is counterweights on crankshafts in piston engines.[6]
Desk lamp: Some balanced arm lamps work with a counterweight to keep the arm and lamp in the desired position.
Counterweights in architecture
César Pelli's Ratner Athletic Center uses cables, masts and underground counterweights as a load-bearing support structure.
Leaning Tower of Pisa has used external counterweights to stabilize the once gradually falling structure.
Elevator: In traction (non-hydraulic) elevators, a heavy counterweight counterbalances the load of the elevator carriage, so the motor lifts much less of the carriage's weight (specifically, the counterweight is the weight of the carriage plus 40-50% of its rated capacity). The counterweight also increases the ascending acceleration force and decreases the descending acceleration force to reduce the amount of power needed by the motor. The elevator carriage and the counterweights both have wheel roller guides attached to them to prevent irregular movement and provide a smoother ride for the passengers.[7]
Space elevator with counterweight at top.
Space elevator: A space elevator is a proposed structure designed to transport material from a celestial body's surface into space. Many variants have been proposed, but the concept most often refers to an elevator that reaches from the surface of the Earth to geostationary outer space, with a counterweight attached at its outer end.
By attaching a counterweight at the end, upward centrifugal force from the Earth's rotation ensures that the cable remains stretched taut, countering the gravitational pull on the lower sections and thereby allowing the elevator to remain upright.
The counterweight itself could assume one of several forms:
a heavy, captured asteroid;
a space dock, space station or spaceport positioned past geostationary orbit; or
an extension of the cable itself far beyond geostationary orbit.
Concrete counterweights on a tower crane
Bascule bridge with concrete counterweight
Metronome: A wind-up mechanical metronome has an adjustable weight and spring mechanism that allows the speed to be adjusted by placement of the weight on the spindle. The tempo speed is decreased by moving the weight to a higher spindle marking or increased by moving it to a lower marking.[8]
Crane: The tower crane (see picture) is a modern form of balance crane that is fixed to the ground. A horizontal boom is balanced asymmetrically across the top of the tower. The long arm carries the lifting gear.[9] The short arm is called the machinery arm; this holds the motors and electronics to operate the crane, as well as the concrete counterweights.[10]
Vertical lift bridge
Drawbridge
Bascule bridge
References[edit]
Jump up ^ http://www.thefreedictionary.com/counterweight
Jump up ^ How do elevators and lifts work? at explainthatstuff.com
Jump up ^ "Basic Crane Design principles". E-Crane International. 2002.
Jump up ^ "How a Trebuchet Catapult Works". Retrieved 2007-04-07.
Jump up ^ "How does a catapult work?". 2000-04-01. Retrieved 2007-04-07.
Jump up ^ Wan, Mark (2000). "AutoZine Technical School: Engine Smoothness". Archived from the original on 2007-03-28. Retrieved 2007-04-07.
Jump up ^ Bellis, Mary. "The History of the Elevator". Retrieved 2007-04-07.
Jump up ^ Metronome. Wikipedia. Accessed 7 April 2007.
Jump up ^ Crane (machine). Wikipedia. Accessed 7 April 2007.
Jump up ^ Brain, Marshall. "How Tower Cranes Work". Retrieved 2007-04-07.
External links[edit]
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values: Diagram of a space elevator.  At the bottom of the tall diagram is the Earth as viewed from high above the North Pole.  About six earth-radii above the Earth an arc is drawn with the same center as the Earth.  The arc depicts the level of geosynchronous orbit.  About twice as high as the arc and directly above the Earth's center, a counterweight is depicted by a small square.  A line depicting the space elevator's cable connects the counterweight to the equator directly below it.  The system's center of mass is described as above the level of geosynchronous orbit.  The center of mass is shown roughly to be about a quarter of the way up from the geosynchronous arc to the counterweight.  The bottom of the cable is indicated to be anchored at the equator.  A climber is depicted by a small rounded square.  The climber is shown climbing the cable about one third of the way from the ground to the arc. Another note indicates that the cable rotates along with the Earth's daily rotation, and remains vertical.

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