UKIP leader Farage says budget row shows EU 'arrogance'

Mr Farage said the European Commission was extravagant in its spending

UK Independence Party leader Nigel Farage has accused the European Commission of "incredible arrogance" as the row over the EU budget continues.

Mr Farage said the Commission was "completely out of touch" with the public after it called for a 4.9% increase in its spending next year.

Chancellor George Osborne has pledged to fight the "unacceptable" proposal.

The EU's Budget Commissioner said projects in Wales, Cornwall, Northern Ireland and elsewhere must be honoured.

An above-inflation 4.9% rise would take the commission's total funding for 2012 to 132.7bn euros (£117bn).

'No object'

Negotiations on the size of the Budget between the Commission, the EU's executive arm, and member states have yet to begin but the Commission's initial proposal has caused anger in the UK and other member states.

Although the UK cannot veto the Budget on its own, Mr Osborne has said "the fight will be joined" over the issue and Brussels "needs a reality check".

He has argued the EU must live within its means at a time when the UK and other countries are having to cut spending to reduce their debts.

Mr Farage, whose party wants the UK to pull out of the EU, said the budget proposal illustrated how "out of touch" those running the organisation were.

"The European Commission just look incredibly arrogant," he told Radio Four's World At One. "All over Europe people are saying public finances are in a hell of a mess and here they want another 4.9%.

"Why should we give any more money to an organisation whose accounts have not been agreed by the auditors for the last 16 years. The whole EU is completely out of touch with its electorate... Money is no object for these people. They are so arrogant and out of touch they simply don't seem to care."

According to estimates from the think tank Open Europe, the UK would have to pay £680m more than it currently does to the EU in the event of a 4.9% budget increase.

'Credibility'

But EU Budget Commissioner Janusz Lewandowski said administration costs were being frozen and "stupid expenditure" being eliminated.

"There is nobody more interested [than me] for the defence of the EU project and the EU Budget to cut what is not really performing," he told the World At One.

But under the terms of a 2007 agreement, he said the EU was legally obliged to provide support to more deprived areas, known as "cohesion" funding, including parts of the UK.

"I can understand the problems of ministers who are in austerity and who are contributing but I can easily find common language with people in Cornwall, Wales, and Northern Ireland for their projects."

He added: "We cannot be irresponsible in terms of the commitments that were made. Here is our credibility. We cannot break the law. Even if you are in austerity, you have to pay your electricity bills."

While it was "easy" to accuse the Commission of waste, he said nearly 95% of the Budget was spent directly in the member states.

And he added: "I believe the perception of the EU project, limited to the narrow financial streams of money to and from Brussels, is misleading. The EU is about a single market with 500 million consumers and huge purchasing power."

After a lengthy fight between the Commission and member states, including the UK and France, the 2011 budget increase was capped at 2.91%.

The UK, France and Germany have also proposed that the EU budget be frozen until 2020, with any increases linked to inflation.