Britain’s annual contribution to the EU £10 billion

The demand from the European Commission started a war of words, with Downing Street calling the request “ludicrous” and George Osborne, the Chancellor, accusing EU officials of having lost touch with reality. Last night the Government refused to say what, if any, increase in Britain’s contributions ministers were prepared to accept, prompting charges that they would eventually “roll over” and agree to hand over more taxpayers’ money.

In 2009, Britons paid £5.3 billion to the EU budget, with the payment rising to £9.2 billion in 2010.

Last year, Mr Cameron promised to fight for a “cut or a freeze” in the 2011 EU budget, but was eventually forced to settle for a rise of 2.9 per cent, costing Britain another £450 million.

The Commission has made a formal request to members for a £5.5 billion budget rise that would take EU spending next year to £117 billion.

Mr Osborne said the demand for more money was “completely unacceptable”, especially at a time when Britain was cutting spending to balance its own budget. “The European Commission need a reality check,” he said. “Europe needs to get in touch with reality and Brussels needs to look at what is happening in countries like Britain, and other countries as well in Europe, where we are all having to live within our means.”

£94billion

The nine tenths of the EU's budget in 2009 that was “materially affected” by irregularities, projects that included the spending of more than £350,000 “improving the lifestyle and living standard of dogs” in Hungary.

£2billion

The annual cost of paying pensions to Eurocrats by 2040, British taxpayers will end up paying £350million of the total.

£136million

More than nine tenths of the EU's budget last year, spending that totalled £94 billion, was "materially affected" by irregularities that included the improper award of contracts worth over £4 billion, Europe's Court of Auditors has found.

Yesterday's (TUES) report into the discharge of the EU's £102 billion 2009 budget declared the Brussels books to be "true and fair" accounts but highlighted "material errors" that affected 92 per cent of spending, with particular concern expressed over worsening farm subsidy payments and shoddy public procurement rules.

"Error rates remain high," said Vitor Manuel da Silva Caldeira, president of the Court of Auditors, noting a slight improvement between 2008 and 2009. "Errors come mainly from incorrect claims for payment and public procurement errors."

British taxpayers will have to pay almost £170 million next year towards European Union pensions after an above- inflation rise that will grant the average retired official an income of more than £60,000 a year.