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EU Financial affairs The common currency The EU budget

EU Financial affairs The common currency The EU budget. Robert Jones robert.jones@anglia.ac.uk July 2005 updated September 2012. The Euro – a British view What are the Pros and Cons of the €uro? Lively debate in Britain since the 1990s!. Britain’s attitude to the Euro pre-crisis?

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EU Financial affairs The common currency The EU budget

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  1. EU Financial affairs The common currency The EU budget Robert Jones robert.jones@anglia.ac.uk July 2005 updated September 2012

  2. The Euro – a British view What are the Pros and Cons of the €uro? Lively debate in Britain since the 1990s!

  3. Britain’s attitude to the Euro pre-crisis? Was Britain prepared? Is the Euro accepted? Pros and Cons? Other examples of common currencies

  4. http://www.euo.dk/euo_en/spsv/euro/

  5. Other common currencies in history?

  6. Roman Empire Roman coins are often dug up in Britain – our first common currency Librius pound £ Solidus shilling s Denarius penny d 12 pennies in a shilling, 20 shillings in a pound, 240 pence in a pound

  7. http://intranet.dalton.org/groups/Rome/RMap.html

  8. A global common currency – Until 1967

  9. Another “common currency” Adopted in 1785, finally covered 100% of USA in 1976. Question:- Why was there such a hurry to adopt the Euro?

  10. http://ec.europa.eu/economy_finance/publications/general/general_en.htmhttp://ec.europa.eu/economy_finance/publications/general/general_en.htm

  11. http://ec.europa.eu/economy_finance/euro/adoption/who_can_join/index_en.htmhttp://ec.europa.eu/economy_finance/euro/adoption/who_can_join/index_en.htm

  12. Advantages of the Euro?

  13. Advantages of the Euro http://ec.europa.eu/economy_finance/euro/why/index_en.htm

  14. The Chancellor’s 5 tests for UK Euro membership in 2003

  15. Key differences between the European Central Bank and the Bank of England ECB Frankfurt Representatives of member nations meet in secret, no report, no public accountability – why? Inflation policy? Rules on stability? BoE London Representatives of the Monetary Policy Committee meet Report is published, therefore accountability Inflation policy?

  16. BBC Wednesday, 20 February 2008, 11:49 GMT Bank voted 8-1 for cut to 5.25% The Bank of England's rate-setting Monetary Policy Committee (MPC) voted by 8-1 to cut interest rates to 5.25% earlier this month, minutes have shown. The bank decided to lower rates by a quarter of a percentage point from 5.5% in February, amid signs of a slowdown. David Blanchflower was the only member who voted differently, favouring a larger cut in rates to 5%. The MPC said markets continued to be stressed and there was potential for greater tightening in credit ahead. The risk I believe to be of most concern is around the interplay between the property market and the financial sector resulting from the credit turmoilKate Barker, MPC member http://news.bbc.co.uk/1/hi/business/7242483.stm http://www.bankofengland.co.uk/publications/news/2008/index.htm

  17. This side of the Channel we have (had) our doubts

  18. Denmark votes no to the Euro in 2000 Reasons? Very similar to British concerns Sweden votes no to the Euro in 2003

  19. Question (pre-crisis) British concern - will the Euro survive? Question (this week) IMF and global concern - will the Euro survive?

  20. Reasons for the Euro crisis?

  21. Clarke and Dawe – the Greek economy

  22. Interest rates of Eurozone nations

  23. UK Government Bond Rates – 24th Sept 2012 http://www.bloomberg.com/markets/rates-bonds/government-bonds/uk/

  24. Are all Euro notes equal? http://www.thisismoney.co.uk/money/news 17may2012

  25. Clarke and Dawe – the European debt crisis

  26. The future of the Euro?

  27. And now another hot potato

  28. The EU budget A “hot” topic! What are your views? How is the budget funded? How is it spent? Who pays? Who receives?

  29. The EU budget - how is the EU funded? From four sources of revenue:- Customs duties from tariffs on imports from countries outside the EU. Agricultural levies from agricultural imports from countries outside the EU. VAT-based contributions 0.75% in 2002 and 2003, then 0.5% thereafter. Contributions based on Gross National Product (GNP) this is set at 1.02% for the 2003 budget.

  30. How is the money spent? The EU committed itself to spending just under 100 billion euro in 2003. http://news.bbc.co.uk/2/shared/spl/hi/europe/04/money/html/introduction.stm

  31. http://ec.europa.eu/budget/figures/2012/2012_en.cfm

  32. Britain’s position Conservative Prime Minister Margaret Thatcher argued from 1979 that the UK contributed too much to the EU Budget, on account of the small size of the UK farming industry. At the Fontainebleu summit in 1984, she famously 'handbagged' EU leaders into agreeing a rebate arrangement.

  33. How much does the UK contribute? The UK's averagenet contribution for 1997-2006 was £3,273 billion. In 2007 it was £4,699 billion http://www.global-vision.net/perspectives11.asp Sources: (1) House of Commons Library, answer to PQ number 130155 from the Hon Bernard Jenkin MP, May 2007, for the years 1997 to 2004. The data were taken from various editions of the annual Treasury publication European Community Finances. (2) HM Treasury, European Community Finances: Statement on the 2007 EC Budget and measures to counter fraud and financial mismanagement, Cm7090, May 2007, for the years 2005 to 2007 (Table 3). The figures for 2007 in the above table are estimates.

  34. National contributions to the EU budget Do similar nations make similar financial contributions? Who actually pays for the European Union?

  35. UK Government view on EU budget BBC Radio 4 interview with Gordon Brown Chancellor of the Exchequer on 10 June 2005 UK’s net contribution over last 20 years = £58 billion France’s = £29 billion UK’s net contribution over last 10 years = £35 billion France’s = £13 billion [UK’s net contribution since 1973 = £76 billion] “What is needed is budget discipline”. By 2013, France will gain £9 billion in agricultural subsidies, a huge proportion of the EU budget

  36. Net contribution to EU budget - 2007 http://news.bbc.co.uk/1/hi/world/europe/8036097.stm#start

  37. The European Union's finances The battle of the budget Mar 3rd 2005 The Economist

  38. http://www.euro-know.org/articles/bandeu/bj1.html#fig1

  39. http://www.publications.parliament.uk/pa/cm200304/cmselect/cmeuleg/42-xv/42-xv.pdfhttp://www.publications.parliament.uk/pa/cm200304/cmselect/cmeuleg/42-xv/42-xv.pdf

  40. Future issues – social costs Source: Organisation for Economic Cooperation and Development  http://www.euro-know.org/articles/bandeu/bj1.html#fig23

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