The European Commission are responsible for calculating Member State contributions to the EU Budget using data provided by Eurostat, who collate and validate the data from Member States’ national statistical institutions, including for the UK the Office for National Statistics.
The Prime Minister has been clear that it was completely unacceptable for the European Commission to demand a payment upfront on such a large scale and provide a month in which to pay it.
European Finance Ministers met on the 7 November, and the Chancellor secured an agreement which meant the UK paid nothing on 1 December. Instead the payment will be made in instalments next year, and no fines or interest will be applied. The UK will also not pay £1.7 billion. The British rebate will apply in full, and apply simultaneously with the payment, not a year in arrears as normal. This means the Government has halved the bill, to around £850 million.
Lastly, the UK won agreement to change the regulations to ensure this never happens again. In the future, if any country receives an adjustment demand that is excessive, it will have the same opportunity to phase payments so that they are more affordable.