Chirac pays 'homage' to Blair - Blair pays 10.5bn

db: It was not only 'homage' that Blair got from Chirac for 10.5 bn Euros - he also got a commitment from him to 'not completely rule out the possibility' of reforming EU farm subsidies before 2013. Mr Chirac said to reporters: "Everyone realised it took a lot of courage [db: money] from Mr Blair ... in a political situation that was not easy."

FT: Europe leaders on Saturday sealed a seven-year European Union budget after Tony Blair made a new offer to pay an extra 10.5bn Euros towards the costs of enlarging the club to the east.

The budget agreement, signed in the early hours and the result of two days of intense haggling, was seen as vital to avoid a deepening of the EU's crisis, marked by a rejection of the EU's constitution by French and Dutch voters, feeble economic growth and increasing national self-interest.

The UK prime minister's offer to give up more of the British budget rebate cleared the way for an increased financial package, in which other richer member states also offered to increase funding for eastern Europe.

Mr Blair's concession coincided with a new offer from France that it would not completely rule out the possibility of reforming EU farm subsidies before 2013, following a review of all spending.

However, President Jacques Chirac also retains a veto over any decision to cut the common agricultural policy before the end of the 2007-13 budget period.

Mr Blair told a 3am news conference in Brussels: "This is about getting an agreement that allows Europe to move forward."

"The budget is an investment in those central and eastern European economies, to help them grow, to help them develop." [db: and to help them buy US weapons, for Nato "interoperability"] Read more