Ed Balls demanded reform of EU's 'outdated budget' in 2007

http://www.guardian.co.uk/politics/wintour-and-watt/2012/nov/01/edballs-labour

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Ed Balls is finding himself in a familiar position. Supporters of Tony Blair have told the Guardian that the shadow chancellor is to blame for putting short term tactics on the EU budget ahead of Labour's long term interests.

Blairites fear Labour will rue its success in defeating the government on Wednesday after voting with eurosceptic Tories to demand a real terms cut in the EU budget. They warn that Labour will want to think twice about repeating this when MPs are asked to vote on an eventual EU budget deal. This will fall a long way short of the current Labour position.

It turns out that Balls has a handy weapon as the Blairities turn their fire on him. In May 2007, a month before Blair stood down as prime minister, the then City minister wrote a pamphlet calling for reform of the EU's "outdated budget".

Balls, who was promoted to the cabinet as schools secretary by Gordon Brown the following month, wrote in the pamphlet published by the Centre for European Reform:

The EU cannot meet the challenges of the 21st century without reforming its outdated budget. Forty per cent of the total budget is currently spent on the common agricultural policy (CAP) and more than 60 per cent of structural and cohesion fund expenditure is still allocated to the rich member-states.

The pamphlet shows that in 2007 Balls was focusing on some of the ideas he used in a Times article on Monday, written with Douglas Alexander, which was designed to set the context for this week's vote. In 2007 Balls wrote of the EU budget:

• We need the highest levels of scrutiny and the most rigorous lines of accountability.

• The principle of sound financial management must and will be to the fore in our approach to the fundamental review of the EU budget. But building on a base of financial probity we must also ask ourselves: what is the role of the EU in any given policy area? Does it require spending?

• Just as we acknowledge there is a clear case for European spending on some objectives, so we must recognise the very real limits to European budgetary intervention.

A Balls ally said he stands by the "hard-headed pro-Europeanism" in the pamphlet in which he wrote:

Here in Britain, I want to make the case for a hard-headed pro-Europeanism:

★ pro-European, because we recognise that we are stronger by co-operating with our partners in the European Union to meet the shared challenges of globalisation and climate change;

★ hard-headed because we must have the confidence to put our national interest first and to sometimes say 'no' and to argue our case where we believe Europe risks taking the wrong course.

To win the argument both for reform in Europe and effective British engagement in Europe, I believe that Britain must break out of the outdated debate over Europe which has dogged British policy for decades.