LONDON, July 16 (AFP) - German Chancellor Gerhard Schroeder urged Britain on Friday to compromise over its European Union budget rebate and said the rift the war on Iraq caused between EU states and with the United States should never happen again.
Schroeder also vowed to secure approval from the German parliament this year for the EU's first ever constitution.
"In the run-up to the necessary discussions (on the rebate), we don't want to have a government manoeuvring itself into a position which it can't get out of," Schroeder told BBC radio in comments dubbed by an interpreter.
On Wednesday the EU's budget commissioner, Germany's Michaele Schreyer, said the annual refund Britain receives on its contributions to the EU budget should in future be shared out among all the big net contributors in the 25-nation bloc.
The rebate was prised out of the rest of the EU in 1984 by then prime minister Margaret Thatcher, who famously demanded "I want my money back" because Britain, then as now, received comparatively little in EU farm aid.
Schreyer said Britain was now more prosperous and it was necessary to divert EU money to newer member states in eastern Europe.
Schroeder told the BBC the enlarged EU had to use its limited resources carefully.
"It would be wrong to say at this point in time that we can't do without a rebate but it would be equally wrong to say that the rebate is something we need to continue to have," he said.
"The ability of Germany to accept a compromise has never been criticised by any other European country but because that is a fact, we also expect others to be willing to enter (into) a compromise."
The interview was recorded on Thursday after a meeting between Schroeder and British Prime Minister Tony Blair at which the rebate issue was not raised.
Turning to the war on Iraq, which caused deeply divisions both within the EU and with the US, Schroeder said: "We must not allow such a situation to develop where Europe is no longer united on such issues and where Europe is no longer in unity with the US on such issues."
Schroeder was one of the most outspoken critics of the US-led war on Iraq. Blair has been Washington's staunchest ally in the war, despite fierce opposition from the British public that has cost him election support.
"It is the task of politicians in Europe and in the US to see to it that in future such situations do not arise," Schroeder said. "I think that the cohesion of the western world does not allow a repetition."
"Both sides have learnt the lessons, for example, that in international crisis one needs to talk, especially in the run-up, more than we may have done in this particular case."
The EU states also split last year over plans for a constitution to streamline decision-making within the bloc. In June they overcame their differences and signed the historic text.
But it must now be ratified.
Britain is to hold a referendum, as are Denmark, France, Ireland, Luxembourg, Spain and Portugal. Belgium, the Netherlands, Latvia and Poland are all likely to announce a popular vote too.
Schroeder vowed in a separate interview published on Friday to secure parliamentary approval for the constitution this year, which would probably make Germany the first EU state to ratify the text.
"The German constitution does not allow for a referendum. We will have a parliamentary process," he told the Financial Times newspaper.
"We want to ensure this happens before the end of the year," he said, adding that he was confident all 25 EU members would ratify the constitution.