John Redwood and Denis MacShane have been debating the growing UK total contribution to the EU Budget.

So let’s go back to how it was negotiated in 2005.

Previous postings (in date order for ease of following the story) are:

In a nutshell, the EU Budget had to grow as the EU had expanded. All agreed on that. But grow by how much? The net Givers (of course) were disinclined to be generous. The net Getters fumed at their meanness. It came to this:

It would have been possible to give Poland most of what it wanted even under the much less ambitious UK/Giver offer, if the Givers themselves took less money from the EU Budget in 2007-2013, primarily through reduced CAP payments.

But France, humiliated by its referendum result, of course would not accept that.

So we in London faced a hard choice.

Should we refuse to accept French and other Giver intransigence and risk letting the EU Budget not be agreed in our Presidency, having fun blaming the French but adding even more stress to an EU already in real disarray?

Or should we accept that, to get what we wanted (ie a final Budget much closer to 1.00% than to 1.26%) French intransigence was an Immovable Object, and instead juggle the sums to offer the new member states a lot less than they reasonably had hoped for but still a goodly whack?

And in any case, how in fact to get a deal?

No 10 came up with a Brilliant Scheme. Do it in a short series of brutal blows.

First, make an offer which you know will be utterly unacceptable. As the howls of rage from all round Europe soar to a crescendo, amuse oneself over the summer by ostentatiously ignoring the din, putting one’s feet on the desk and watching the 2005 Ashes.

Then, after they’ve all shouted themselves hoarse and are shaking with the effort, make a slightly bigger offer, proclaiming this to be a huge but mainly final step in the direction of our EU partners’ real concerns blah blah.

This too will be rejected as disgraceful and inadequate, but with less vehemence than previously. Gulp, what if the Brits really mean it?

This second offer will have the vital effect of lurching the whole debate on to the UK end of the outcome spectrum, as some of the countries in the middle who have relatively little at stake start to quietly sign up for a deal ‘something along these lines’.

The main Getters will see the previous united anti-UK front fraying and will start to bicker between themselves – those who stand to Get quite a bit will be tempted to grab what is on offer lest the whole deal unravel during the remaining weeks of the UK Presidency, whereas those who think they must Get a Lot will be furious at the weedy and eroding ‘solidarity’ of their erstwhile closest allies.

Subject to how all that has gone, do some bilateral rounds. Warn privately (and convincingly) that there is just not going to be much more than this in the final deal, so everyone had better start redefining their expectations and briefing their media accordingly.

Pick off individual capitals with sly side-deals and offers of small-print in their favour which others might not notice.

Above all, make every effort to infuriate but also rattle the Belgians who have made several obnoxious statements about British anti-Europeanness.

Let all that stew for a few more weeks, cranking up the pressure as the end-of-Presidency summit looms.

While all this was unfolding, I was acting as chair of the EU Ambassadors group in Warsaw. It happened that in autumn 2005 the Poles were electing first a new Parliament and then a new President. So there was to be no real negotiation with the Polish side until the outcomes of those elections were clear.

That said, some sort of heavy centre-right victory was bound to happen in the polls this time round, and the new leadership would have to press hard for the best possible deal.

The expectation for months had been that the Citizens Platform party led by Donald Tusk would come ahead of the vote in the Parliamentary race and form a coalition with the Law & Justice Party led by the Kaczynski twins. The papers were starting to discuss in great detail who would have which job in the new coalition.

Then … sensation. The centre-right parties won big as expected.

But Law & Justice came first.

Surely there would be the same coalition but under different top leadership? Or … not?!

What did this mean for Poland’s negotiating position as the Budget deal showdown loomed?

As my telegram to London put it, having confidently and as it turned out wrongly predicted a new coalition between Citizens Platform and Law & Justice for the best part of a year, I now did not have the foggiest idea what was going to happen.

To be continued…