British Prime Minister Tony Blair has warned 10 mainly former Communist countries, which joined the European Union last year, they will receive only one third of the E.U. aid promised to them, if there is no agreement on a reduced budget in December. Mr. Blair met Friday in Budapest with regional leaders.

Britain, which currently holds the EU presidency, has suggested slashing EU aid to its 10 newest member states by about 10 percent, or nearly $19 billion, to ensure a healthy future for the European Union.

In Budapest, the prime ministers of Hungary, Poland, Slovakia and the Czech Republic signaled they were ready to discuss some cuts, but only if they were offset by easier access to funding, which they need to modernize their infrastructure and economies after decades of communism.

Hungarian Prime Minister Ferenc Gyurcsany said a compromise could be reached, but not at any price. He said the new E.U. members could not bear the full cost of expansion, and urged other European countries to make concessions.

"If all of us are insisting on our previous compromises, it will not be about Europe," he said.  "It will be just about the representation of the national interest. But the different national interests together or next to each other doesn't create a unified Europe and a new unified European dream and politics."

During a sometimes stormy debate at a news conference, British Prime Minister Tony Blair said Britain would not give up a budgetary rebate, which Britain negotiated in 1984, saying it pays a disproportionate amount into EU coffers and receives little in return in regional grants and farming subsidies.

Mr. Blair left open the possibility, however, of a reduction of the rebate, saying Britain was prepared to spend more on economic development for Eastern European countries.

"I am not giving up the rebate, but I have also said, we have got to pay our fair share of enlargement," said Mr. Blair.

But Mr. Blair said Britain would not give up any part of its rebate for policies that would benefit the original 15 European countries. Britain wants those countries to make concessions on the agricultural subsidies they receive from the EU budget. 

Mr. Blair also warned new members they may receive far less than was promised to them, if no agreement is reached on the budget at a summit later this month, when Britain's six-month presidency of the European Union ends.

"If any politicians here, or anywhere else, are saying say 'no' and have no deal in December, the consequence of that is that you can end up in two years' time with only a third of the money actually coming to countries like this," explained Mr. Blair.  "I mean, I have to say very frankly, I think it is unlikely that we will get an agreement under the next presidencies.  And then, the European Parliament takes control of the budgetary process, and will take control on the basis of the existing situation."

Hungarian Prime Minister Gyurcsany said that Europe can only move forward if everyone is treated equally.

Slovak Prime Minister Mikulas Dzurinda told VOA he is still open to compromise. 

"I want to reach as big flexibility as possible and to accept as less reduction of expenditures as possible. So there is a space for negotiations," he said.

Mr. Blair arrived in Budapest after meeting with the leaders of the three Baltic states in Estonia on Thursday.