Too Many Transport Schemes 'Stuck In Slow Lane'

Too many transport projects crucial to business growth are being sidelined by the Government, the British Chambers of Commerce says.

Of 13 key projects identified as vital before the 2010 general election, just three are going ahead, with two having some funding committed and eight delayed, cancelled or under consideration.

BCC director of policy Dr Adam Marshall told Sky News that bold action was needed from the Government to improve transport infrastructure.

"We need to see projects delivered with some pace and some urgency," he said.

"We know there are limited resources available but business can deliver growth and jobs if it has the transport infrastructure it needs."

Crossrail construction at Moorgate station in London

The three BCC-earmarked projects going ahead are:

:: Birmingham Motorway Scheme - Variable speed limits and cars using hard shoulder on M5, M6, M40 and M42, with work due to be completed in spring 2014

:: Forth Replacement Crossing: A replacement for the deteriorating existing road bridge was given the go ahead by the Scottish Government and Transport for Scotland in January 2011 and will be complete by 2016

:: Crossrail, London: The cross-London rail link is well under way and expected to be fully operational in 2019, improving capacity across the capital.

The BCC said it had awarded an "amber light" to two projects where some funding had been committed and a planning process was under way, but there was no date for final delivery.

One of these was the so-called Northern Hub rail improvement scheme to deliver £4bn of benefits to the economy of northern England.

The BCC said the Government committed to the scheme in summer 2012, that planning was still in the very early stages and delivery of all projects was uncertain, "but there have been confident steps forward in recent months".

The other "amber" scheme was the A453 widening from the M1 junction 24 to the A52 at Nottingham in the East Midlands.

The M4 relief road scheme in Wales has been given a red light

The BCC said construction was due to start in 2013 following a Government commitment to the project, but "more concrete steps need to be taken to push the project to its conclusion".

The rest of the 13 projects received the BCC "red" signal, including the scrapped third runway plan at Heathrow airport in west London and the delayed A14 road improvement scheme in East Anglia.

Others given a red light included the Cardiff-Newport M4 relief road scheme in Wales, the M1 Westlink project in Northern Ireland, the A19 improvement work around the Tyne Tunnel in north east England and the A303/A358 road improvement scheme to improve links to southwest England.

The BCC said: "While the Government has taken important steps to boost infrastructure funding and delivery since the first Budget, the updated assessment shows that too many transport projects, which are crucial to business growth, are stuck in the slow lane."

But Transport Minister Norman Baker insisted the issue was a "top priority" for the Government.

He said: "That is why, despite the economic challenges we face, we have committed to building HS2, a hugely ambitious infrastructure project which will support and sustain long-term growth across the whole country.

"In addition, our massive programme of investment - the biggest since the 19th Century - in the current railway system includes substantial investment to increase capacity on the East Coast Main Line over the next two years as well as £240m for the industry to spend on the route between 2014 and 2019.

"This is on top of the £1.8bn we are spending on local major transport projects and the £3bn we are providing to start work on 20 major road schemes and to complete work on another eight between 2010 and 2015."

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UBS Fined £29m Over London Rogue Trader

The City watchdog has fined Swiss investment bank UBS £29.7m over the biggest fraud in British history.

The Financial Services Authority (FSA) fined the bank for system and control failings within its corporate structure that allowed London rogue trader Kweku Adoboli to cause £1.4bn losses through unauthorised trading.

The FSA originally fined UBS £42.4m but discounted the penalty for early settlement.

At one point, Adoboli had stood to run up losses of £7.5bn for his employer.

The FSA said in a statement: "The systems and controls failings revealed serious weaknesses in the firm's procedures, management systems and internal controls."

In a damning judgment of UBS' internal controls, the FSA said the bank's computerised risk management system was "not effective".

UBS boss Oswald Gruebel resigned over the massive fraud

It said Adoboli exploited "significant deficiencies" in the disparate trading system to conceal his unauthorised trades.

The FSA said Adoboli's actions on the Exchange Traded Funds Desk (ETFD) were helped by a culture of support sections working on the principle of efficiency and not risk management.

The Global Synthetic Equities (GSE) division was responsible for managing the ETFD.

The FSA said "the supervision arrangements within GSE were poorly executed and ineffective".

UBS was fined 15% of the revenue of the GSE division by the FSA.

Tracey McDermott, FSA director of enforcement and financial crime, said: "UBS' systems and controls were seriously defective.

"UBS failed to question the increasing revenue of the desk and failed to ensure that there was a corresponding increase in the controls in place over the desk.

"As a result Adoboli, a relatively junior trader, was allowed to take vast and risky market positions, and UBS failed to manage the risks around that properly.

Kweku Adoboli was jailed for seven years over the fraud

"Failures of this type in firms of the size and standing of UBS not only damage the firms concerned but also wider confidence in the integrity of the markets and the financial system.

"It is imperative that the markets we regulate are seen by investors to be orderly and a safe place to do business."

Last week Adoboli, 32, was found guilty - he admitted to the bad trades, but denied any wrongdoing.

He was sentenced to seven years for one count of fraud and four years for the other, to be served concurrently.

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'Austerity Era Could Last Up To Eight Years'

A key financial target of the Chancellor's Autumn Statement next week may have to be abandoned, according to a leading think tank.

The Institute for Fiscal Studies (IFS) has said that the target that debt should be falling in the 2015-16 tax year may be too difficult to achieve.

The IFS added that George Osborne may even be forced to announce yet more spending cuts or tax increases for the next Parliament in order to meet his other fiscal targets.

Mr Osborne will reveal his Autumn Statement on December 5. It is expected to provide an update on the Government's plans for the economy based on the latest forecasts from the Office for Budget Responsibility (OBR).

The latest OBR forecasts will be published alongside the Chancellor's Autumn Statement.

According to independent forecasters, the OBR will take into account a weaker outlook for the UK economy and concern over tax revenues during the last seven months.

The issue of corporation tax has become a hot political issue in the last two weeks after it emerged major US multinationals such as Google, Amazon and Starbucks greatly restrict their tax liability through complex offshore structures.

The angry backlash was prompted by the revelation that Starbucks has only paid £8.6m UK corporation tax in the past 13 years, on sales of £3.1bn.

The IFS said that if the trend for borrowing so far this year persists for the remainder of the year, public debt borrowing in 2012-13 would total £133bn.

The era of austerity could run for eight more years, according to the IFS

Excluding the one-off impact of the transfer of assets from the Royal Mail Pension Plan, the borrowing figure would be £13bn higher than forecast by the OBR.

This would mean that underlying borrowing rose between 2011-12 and 2012-13 rather than fell as the Chancellor had intended.

This £13bn overshoot in borrowing arises from an estimated shortfall in receipts of £17bn, offset partially by a £4bn underspend by Whitehall departments.

IFS deputy director Carl Emmerson, said: "Since the budget, the outlook for the UK economy has deteriorated and Government receipts have disappointed by even more than this year's weak growth would normally suggest.

"If much of the additional weakness this year feeds into a permanently higher outlook for borrowing, the planned era of austerity could run for eight years - from 2010/11 to 2017/18."

TUC general secretary Brendan Barber reacted angrily to the IFS prediction. "This analysis shows that the Chancellor's economic strategy is failing on all counts," he said.

"The UK should be on the road to recovery by now. Instead we could be set for a prolonged period of debilitating austerity well beyond the next election.

"The Chancellor should use his Autumn Statement next week to change course. Sadly he looks set to drive the economy even faster in the wrong direction."

IFS researchers will present their analysis at a briefing the following day, Thursday, December 6.

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'Black Friday' Discount Day Reaches UK

Some of the UK's biggest retailers are cashing in on a US tradition which sees millions of frenzied shoppers make the most of discounted prices.

Amazon, Asda and Apple are among the companies that have launched so-called Black Friday sales in Britain - despite many consumers being unaware of the custom.

In the US, thousands of stores discount their prices the day after Thanksgiving, and many open for longer hours.

Last year a record number of people visited stores over the Black Friday weekend, spending a total of $52bn (£32.6bn) - an average of around $400 (£250) each, according to the National Retail Federation.

And this year, some eager shoppers have been caught on camera phones battling to get to the best bargains first, after queuing for hours. 

Many retailers opened their stores at midnight, and this year the trend to open at 8pm on Thursday started to spread.

Some US stores were frantic

While the shift was denounced by some store employees and traditionalists as pulling people away from families on Thanksgiving, many shoppers welcomed the chance to shop before midnight.

"I think it's better earlier. People are crazier later at midnight," hotel worker Renee Ruhl, 52, said as she shopped at a Target store in Orlando, Florida.

Online retailer Amazon was one of the first companies to bring the trend to the UK.

It launched a week-long Black Friday sale on Monday, which it claims "offers millions of pounds of savings on hundreds of Christmas gifts".

Tech giant Apple and Asda, owned by Walmart, are also hoping to make the most of the Christmas shopping rush by offering one-day discounts of their own.

Hotel Chocolat emailed customers to say that as it offered US customers 20% off it would do the same for UK buyers.

"There are more retailers launching sales this year than ever before - and many British consumers are becoming aware of the tradition for the first time," Retail Week's Gemma Goldfingle told Sky News.

"In the US it is an absolute phenomenon, with people queuing up all night to snap up the best deals."

Amazon launched its sale on Monday

In Orlando at least one family camped outside a Best Buy shop for a full week, sleeping in two tents.

"It has not reached that level here and whether it ever will is another matter," Ms Goldfingle said.

She said that Americans have Thanksgiving to kick-start the event – whereas in the UK it is just a normal day. Boxing Day, when UK sales traditionally begin, is a normal work day for Americans.

"A lot of British retailers would prefer not to have it," Ms Goldfingle said.

"They want to be selling items at full price ahead of Christmas, especially given the tough economic conditions."

While a limited number of UK chains have labelled their sales as Black Friday, many others have needed to show weekend price drops to lure customers.

Furniture chain dfs has taken to advertising in newspapers about its discounts while Topshop offered online weekend deals.

Black Friday, which is thought to refer to the first day of the year that retailers go "into the black", comes just ahead of Cyber Monday - which the marketing industry claims is the busiest day in the online shopping calendar.

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Cameron: EU Deal 'Just Not Good Enough'

What Now For EU Budget?

Updated: 10:16pm UK, Friday 23 November 2012

By Adam Boulton, Political Editor

The 27 EU member states did not agree a budget for the next seven years at the summit in Brussels. But David Cameron will be able to go home and tell Eurosceptic conservative backbenchers "so far, so good".

In his own words the Prime Minister "successfully defended" Britain's contributions rebate and rejected a deal which "was just not good enough".

Mr Cameron also insisted that Britain had not been isolated but was joined in its demands for lower spending by other big net contributors including Denmark, Sweden, Finland, Norway and Holland.

This Nordic European grouping also claims the support of the key deal-maker and biggest funder, Germany. But in her public comments Chancellor Angela Merkel was more circumspect, merely noting, as she had since arriving in Belgium, that the gap between the want-mores and the want-lesses was too big to bridge at this meeting.

She and the hapless Herman Van Rompuy, who has the thankless task of chairing these negotiations, have the same message - it is more important to get it right than to rush for a deal.

Mr Van Rompuy now has "weeks" to try to find an agreement. When EU leaders come back to the budget early next year (having put the matter to one side at the next summit in December) they will be on deadline.

If an agreement is not reached then, funding will be rolled over on an annualised basis - bad news for Britain because budgets will automatically increase, and worse news for countries such as Denmark and Holland who have not yet secured their rebates.

So doesn't that mean that all the countries who want more have to do is sit it out? Not quite. Of the 27 member states nine countries are net contributors, including all the Nordic holdouts, and around 15 are significant recipients. Ultimately all the winners are vulnerable, especially if Germany joins in so much as threatening to turn off the tap.

The leaders calling for further cuts all make the same argument - they are imposing austerity at home and it is not acceptable to their voters that the European slice of their budgets simply should be exempted from a squeeze.

The Council President, Mr Van Rompuy, and Jose Barosso his counterpart at the EU Commission probably made a mistake in refusing to table any cuts in the administration budget - pay and perks for bureaucrats. Mr Cameron contrasted this with the "difficult decisions" being imposed on the UK civil service and insisted that the EU could not live "in a parallel world".

But ultimately these are points of principle rather than matters of real significance to national budgets. The UK's government spending now runs to about one trillion euros a year - the EU is arguing about one trillion euros over seven years divided between 27 nations. Of that the "administration" budget is just 6%. Which means that when Mr Cameron talks about saving a billion euros by, for example, stopping automatic promotion of civil servants, he really is talking about a drop in a bucket.

This is perhaps why the economics professor who now is Prime Minister of Italy, Mario Monti, accused Mr Cameron of being an irrational "demagogue". Italy is now in an alliance with France supporting the claims of those who want a bigger budget in the interests of "solidarity". Both Italy and France are net contributors to the EU overall but they are also big recipients of the Common Agricultural Policy, which accounts for some 40% of EU spending.

Perhaps the most significant thing that happened at this summit was that there was no Franco-German axis. Chancellor Merkel and President Francois Hollande took opposing positions.

What's more Germany now seems concerned not to isolate the UK, because of fears that another confrontation could move Britain out of the Union altogether - ceding much greater influence inside to socialist-led France and its Mediterranean allies.

As the European Union scrambles to find a deal Germany, Britain and their North European allies would seem to have the stronger hand - following the time-honoured principle of who pays, plays - provided that their alliance holds together.

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Tax Backlash Prospect For Independent Shops

By Poppy Trowbridge, Business & Economics correspondent

Independent businesses could benefit from public uproar over low rates of corporation tax paid by global giants Starbucks, Amazon and Google, according to retail experts.

The backlash has been prompted by the revelation that Starbucks has paid just £8.6m UK corporation tax in the past 13 years, on sales of £3.1bn, when most businesses will pay a corporation tax rate of 24% this year.

In 2011, Google paid £6m tax against sales of £395m, while Amazon paid no tax at all in the UK - despite sales here reaching £3.3bn.

Matthew Stych, research director at analysts Planet Retail, believes British retailers can make the most of the furore by highlighting their own contributions and good practices.

"It's a golden opportunity that comes along once in a decade or so, to really capitalise on the negative publicity that some global retailers are receiving at the moment," he says.

"I think it's a huge opportunity that independent retailers in the community must seize now".

Google and Amazon are also accused of paying low taxes on big profits

Independent booksellers in Hertfordshire are doing just that. With support from the Booksellers Association they have launched an advertisement campaign to publicise the fact they pay their taxes.

"People need to think about where they are spending their money and we are hoping that this campaign will bring that to their attention," said Sheryl Shurville, co-owner of Chorleywood Bookshop.

But other analysts are not convinced such consumer campaigns will have any long-term benefit.

"We're unlikely to see any massive dip in the sales of these companies under scrutiny," says Douglas McNeill, chief analyst at Charles Stanley.

"Whilst ethical issues can temporarily make people pause for thought, consumers make their choices on the basis of eternal basics of price, quality and convenience."

Mr Stych says large brands may yet find a way to turn around the negative publicity.

"As far as Amazon and Starbucks are concerned, I think there's an opportunity to strike a more conciliatory note," according to Mr Stych. 

"This is for them also an ideal opportunity to regain or re-forge that bond with local consumers".

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'Black Friday' Discount Day Reaches UK

Some of the UK's biggest retailers are cashing in on a US tradition which sees millions of frenzied shoppers make the most of discounted prices.

Amazon, Asda and Apple are among the companies that have launched so-called Black Friday sales in Britain - despite many consumers being unaware of the custom.

In the US, thousands of stores discount their prices the day after Thanksgiving, and many open for longer hours.

Last year a record number of people visited stores over the Black Friday weekend, spending a total of $52bn (£32.6bn) - an average of around $400 (£250) each, according to the National Retail Federation.

And this year, some eager shoppers have been caught on camera phones battling to get to the best bargains first, after queuing for hours. 

Many retailers opened their stores at midnight, and this year the trend to open at 8pm on Thursday started to spread.

Some US stores were frantic

While the shift was denounced by some store employees and traditionalists as pulling people away from families on Thanksgiving, many shoppers welcomed the chance to shop before midnight.

"I think it's better earlier. People are crazier later at midnight," hotel worker Renee Ruhl, 52, said as she shopped at a Target store in Orlando, Florida.

Online retailer Amazon was one of the first companies to bring the trend to the UK.

It launched a week-long Black Friday sale on Monday, which it claims "offers millions of pounds of savings on hundreds of Christmas gifts".

Tech giant Apple and Asda, owned by Walmart, are also hoping to make the most of the Christmas shopping rush by offering one-day discounts of their own.

Hotel Chocolat emailed customers to say that as it offered US customers 20% off it would do the same for UK buyers.

"There are more retailers launching sales this year than ever before - and many British consumers are becoming aware of the tradition for the first time," Retail Week's Gemma Goldfingle told Sky News.

"In the US it is an absolute phenomenon, with people queuing up all night to snap up the best deals."

Amazon launched its sale on Monday

In Orlando at least one family camped outside a Best Buy shop for a full week, sleeping in two tents.

"It has not reached that level here and whether it ever will is another matter," Ms Goldfingle said.

She said that Americans have Thanksgiving to kick-start the event – whereas in the UK it is just a normal day. Boxing Day, when UK sales traditionally begin, is a normal work day for Americans.

"A lot of British retailers would prefer not to have it," Ms Goldfingle said.

"They want to be selling items at full price ahead of Christmas, especially given the tough economic conditions."

While a limited number of UK chains have labelled their sales as Black Friday, many others have needed to show weekend price drops to lure customers.

Furniture chain dfs has taken to advertising in newspapers about its discounts while Topshop offered online weekend deals.

Black Friday, which is thought to refer to the first day of the year that retailers go "into the black", comes just ahead of Cyber Monday - which the marketing industry claims is the busiest day in the online shopping calendar.

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Cameron: EU Deal 'Just Not Good Enough'

What Now For EU Budget?

Updated: 10:16pm UK, Friday 23 November 2012

By Adam Boulton, Political Editor

The 27 EU member states did not agree a budget for the next seven years at the summit in Brussels. But David Cameron will be able to go home and tell Eurosceptic conservative backbenchers "so far, so good".

In his own words the Prime Minister "successfully defended" Britain's contributions rebate and rejected a deal which "was just not good enough".

Mr Cameron also insisted that Britain had not been isolated but was joined in its demands for lower spending by other big net contributors including Denmark, Sweden, Finland, Norway and Holland.

This Nordic European grouping also claims the support of the key deal-maker and biggest funder, Germany. But in her public comments Chancellor Angela Merkel was more circumspect, merely noting, as she had since arriving in Belgium, that the gap between the want-mores and the want-lesses was too big to bridge at this meeting.

She and the hapless Herman Van Rompuy, who has the thankless task of chairing these negotiations, have the same message - it is more important to get it right than to rush for a deal.

Mr Van Rompuy now has "weeks" to try to find an agreement. When EU leaders come back to the budget early next year (having put the matter to one side at the next summit in December) they will be on deadline.

If an agreement is not reached then, funding will be rolled over on an annualised basis - bad news for Britain because budgets will automatically increase, and worse news for countries such as Denmark and Holland who have not yet secured their rebates.

So doesn't that mean that all the countries who want more have to do is sit it out? Not quite. Of the 27 member states nine countries are net contributors, including all the Nordic holdouts, and around 15 are significant recipients. Ultimately all the winners are vulnerable, especially if Germany joins in so much as threatening to turn off the tap.

The leaders calling for further cuts all make the same argument - they are imposing austerity at home and it is not acceptable to their voters that the European slice of their budgets simply should be exempted from a squeeze.

The Council President, Mr Van Rompuy, and Jose Barosso his counterpart at the EU Commission probably made a mistake in refusing to table any cuts in the administration budget - pay and perks for bureaucrats. Mr Cameron contrasted this with the "difficult decisions" being imposed on the UK civil service and insisted that the EU could not live "in a parallel world".

But ultimately these are points of principle rather than matters of real significance to national budgets. The UK's government spending now runs to about one trillion euros a year - the EU is arguing about one trillion euros over seven years divided between 27 nations. Of that the "administration" budget is just 6%. Which means that when Mr Cameron talks about saving a billion euros by, for example, stopping automatic promotion of civil servants, he really is talking about a drop in a bucket.

This is perhaps why the economics professor who now is Prime Minister of Italy, Mario Monti, accused Mr Cameron of being an irrational "demagogue". Italy is now in an alliance with France supporting the claims of those who want a bigger budget in the interests of "solidarity". Both Italy and France are net contributors to the EU overall but they are also big recipients of the Common Agricultural Policy, which accounts for some 40% of EU spending.

Perhaps the most significant thing that happened at this summit was that there was no Franco-German axis. Chancellor Merkel and President Francois Hollande took opposing positions.

What's more Germany now seems concerned not to isolate the UK, because of fears that another confrontation could move Britain out of the Union altogether - ceding much greater influence inside to socialist-led France and its Mediterranean allies.

As the European Union scrambles to find a deal Germany, Britain and their North European allies would seem to have the stronger hand - following the time-honoured principle of who pays, plays - provided that their alliance holds together.

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Tax Backlash Prospect For Independent Shops

By Poppy Trowbridge, Business & Economics correspondent

Independent businesses could benefit from public uproar over low rates of corporation tax paid by global giants Starbucks, Amazon and Google, according to retail experts.

The backlash has been prompted by the revelation that Starbucks has paid just £8.6m UK corporation tax in the past 13 years, on sales of £3.1bn, when most businesses will pay a corporation tax rate of 24% this year.

In 2011, Google paid £6m tax against sales of £395m, while Amazon paid no tax at all in the UK - despite sales here reaching £3.3bn.

Matthew Stych, research director at analysts Planet Retail, believes British retailers can make the most of the furore by highlighting their own contributions and good practices.

"It's a golden opportunity that comes along once in a decade or so, to really capitalise on the negative publicity that some global retailers are receiving at the moment," he says.

"I think it's a huge opportunity that independent retailers in the community must seize now".

Google and Amazon are also accused of paying low taxes on big profits

Independent booksellers in Hertfordshire are doing just that. With support from the Booksellers Association they have launched an advertisement campaign to publicise the fact they pay their taxes.

"People need to think about where they are spending their money and we are hoping that this campaign will bring that to their attention," said Sheryl Shurville, co-owner of Chorleywood Bookshop.

But other analysts are not convinced such consumer campaigns will have any long-term benefit.

"We're unlikely to see any massive dip in the sales of these companies under scrutiny," says Douglas McNeill, chief analyst at Charles Stanley.

"Whilst ethical issues can temporarily make people pause for thought, consumers make their choices on the basis of eternal basics of price, quality and convenience."

Mr Stych says large brands may yet find a way to turn around the negative publicity.

"As far as Amazon and Starbucks are concerned, I think there's an opportunity to strike a more conciliatory note," according to Mr Stych. 

"This is for them also an ideal opportunity to regain or re-forge that bond with local consumers".

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EU Budget: 'Long Way To Go' Before Deal

David Cameron has demanded billions in pay and pension cuts from the EU's civil service in support of austerity-hit workers across Europe.

Ahead of a crucial budget summit last night, he presented EU heads with a paper setting out how Brussels could slash at least six billion euro (£4.8bn) off its staff costs at a stroke by upping retirement ages, lowering pensions and trimming lavish salaries.

President of the European Council Herman Van Rompuy and President of the European Commission Jose Manuel Barroso were caught by surprise during the private talks with the Prime Minister.

Mr Cameron's position was to impose a real-terms freeze in spending in common with national public sector cuts, including a solidarity gesture by targeting the 60bn euro-a-year (£48bn) administrative budget which pays the 40,000-plus civil service behind the Commission, Council and European Parliament.

Following the meeting Downing Street said there was "a long way to go" before EU leaders could agree a long-term budget.

A Downing Street spokesman said: "The Prime Minister set out our position that while the latest proposals were a step in the right direction, they did not go far enough and that we think more can be done to rein in spending."

Mr Cameron said he would be fighting "very hard" to secure a good deal for British taxpayers and to keep the rebate negotiated by Margaret Thatcher in the 1980s.

Cameron meets Barroso and van Rompuy prior to the summit

"These are very important negotiations. Clearly at a time when we are making difficult decisions at home over public spending it would be quite wrong - it is quite wrong - for there to be proposals for this increased extra spending in the EU," he said.

He has welcomed proposals from Mr Van Rompuy which would deliver a small real-terms cut in EU spending commitments, but has made clear he is unhappy with other details of the package, which demands a reduction in the £2.9bn UK rebate.

The start of the meeting was delayed until mid-evening as the rest of the EU's leaders held their own "confessionals" throughout the day, setting out their positions on how much cash the EU should be given to pay for policies between 2014 and 2020.

A pre-summit compromise is already on offer - a seven-year budget "envelope" of 973bn euro (£785bn) for 2014/2020, a cut of nearly 5bn euro (£3.8bn) compared with the 2007/2013 ceiling.

The move was seen in Downing Street as being in the right direction - although the "cut" is in a spending ceiling which officials say has not been reached.

It is also above the 886bn euro (£712bn) originally pitched by the Treasury as in line with the real-terms freeze Mr Cameron wants.

The EU headquarters in Belgium

But in the complex world of EU budget economics, with financial "commitments" different from "payments", a range of calculation options, rebates for some countries, and contributor and beneficiary member states, Mr Cameron and his colleagues have plenty of scope for claiming summit success.

The Prime Minister's allies for budget belt-tightening, including Sweden and the Netherlands, have demanded hefty financial cuts.

Germany, France, Finland and Austria want to freeze the maximum Brussels can draw from member states every year - leaving plenty of scope to argue over the actual spending figures within the ceiling.

And 15 countries, led by Poland, are backing budget increases, not least to preserve the scale of cash aid they receive as "net beneficiaries" from the EU kitty.

Britain is arguing for a shake-up in EU spending priorities, cuts in agriculture spending and subsidies - fiercely defended by France - and cuts in EU staff levels and pay and perks, in line with national civil servants.

But the European Commission still insists that a spending increase is necessary, not least to pay for policies already agreed by member states.

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