Compromise in the air

In a meeting in Budapest with British Prime Minister Tony Blair, Poland, the Czech Republic, Hungary and Slovakia signaled that they could accept a small cut in the aid they receive from EU coffers. Although the talks failed to produce a breakthrough, both sides described them as useful.

"We needed this conversation - it was very tough but very important," Prime Minister Kazimierz Marcinkiewicz told reporters. "Mr Blair did not present concrete figures but I can say Poland will not agree to a bad budget." Under earlier British proposals, Poland stood to lose around R6 (zł.23.4) billion in funding.

"We are still far from agreement today," Hungarian Prime Minister Ferenc Gyurcsany told a news conference. "We want to come to an agreement but not at any price."

Diplomats say the new members reiterated their resistance to a plan by current EU chairman Britain to slash EU aid to the 10 newcomers by 10 percent, or about EUR 16 (zł.62.5) billion.

But they could agree to a smaller cut, if it was offset by easier access to funding.

"I think that Britain might agree on around [a] five percent [cut]," a senior official at the Budapest meeting said.

However, behind the tough talk, diplomats said that some compromise proposals were beginning to gain currency. Britain is due to announce its detailed proposals this week.

The central Europeans could, for example, be allowed to reduce their contribution to the EU budget by the amount that goes towards the funding of the British budget rebate that is at the center of the budget dispute. Another option would see the cut in their aid reduced by spreading budget savings to EU spending on rural development in the rich Western countries. (Reuters)