To freeze or to cut - Westminster draws EU budget battle lines

David Cameron speaking after EU summit on 19 October 2012 Image copyright Getty Images
Image caption Mr Cameron has threatened to veto the 2014-20 EU budget

So, it's like this. A bunch of Conservatives called Mark, Mark, Zac, John, Sarah and Bill want a real terms cut in the EU's long term budget.

Their boss Dave says no, that's going too far.

He thinks there should just be a real terms freeze in the EU budget.

But Ed and Douglas from Labour say no, Dave's plan is too feeble. They think Mark & co have got it right and there should be a real terms freeze. But Glenis - who leads Labour in Brussels - says no, her mates Ed and Douglas have got it wrong.

She thinks Dave has got it right. She reckons a real terms freeze is enough. Oh, and by the way, Tony is still banging on about how Europe needs an elected president, just the job for an ambitious former prime minister with time on his hands.

That is just about where we are by the close of play today. All that matters is what Labour chooses to do in the Commons vote on Wednesday.

Making mischief?

For now, they are still playing footsie. Can they hold their nose and vote with the likes of Bill Cash? Can Bill Cash and others hold their nose and vote with the likes of Ed Balls?

Some in Labour reckon the Tories are just making mischief. If they were serious about this rebellion, they say, there would be more names on the amendment and a lot more work would have been done to prepare the ground.

Some of the Tories believe that Labour is being opportunistic and will be seen as such by the coalition backbenches. Labour is the party, they say, that gave up £7bn of Britain's rebate and allowed through two inflation-busting EU budget increases in office.

Privately, officials in Whitehall say that demanding a cut is implausible and that securing a real terms freeze would be unprecedented and a huge victory in itself.

So in the Commons, the whips are working hard to make sure the government has the numbers it needs on Wednesday night. They are taking threat of defeat seriously. But I don't detect genuine worry yet among ministers and Downing Street.

The irony of all this is that even if Mr Cameron fails to secure a real terms freeze (he would, of course, need the unanimous support of all other EU member states) and is forced to use a veto, then Britain could still end up paying more into the Brussels budget.

That's because the budget would be calculated using the previous year's financial framework plus inflation. And that is agreed, let us not forget, by qualified majority voting.