Jack Straw has rejected French calls for an end to Britain's £2 billion-a-year European rebate.

The foreign secretary was speaking after the French president, Jacques Chirac, has called for Britain's annual rebate to be reviewed.

Straw told journalists in London that Chirac had signed up to previous European agreements underwriting the British rebate, and had also committed France to working to reform the common agricultural policy.

The move comes as European governments debate ways to pay for the expansion of the union into central and Eastern Europe.

France, angry at attempts to reform farm subsidies through the CAP, increased tensions with London when it called for the rebate to be withdrawn.

The Commission has conceded that CAP reform, which will reduce the subsidies received by French farmers, is essential before enlargement

In a bid to allay British fears, the EU budget commissioner, has dismissed suggestions that the UK's rebate could be targeted.

Michaele Schreyer said that the budget rebate, last negotiated in 1999, will not be revisited before enlargement.

"In Berlin in 1999, there was discussion of the UK rebate in connection with enlargement and it was decided at this time,'' she told the BBC.

"The resources decision which decides on the British rebate is in force since January 1 this year so at the moment it is really not on the agenda.''

Critics of the French administration claimed the rebate call is part of a concerted attempt to frustrate change to budget allocations that benefit Paris.

Michael Ancram, the shadow foreign secretary, argues the issue is a red-herring designed as a "smokescreen to take attention away from reform of the CAP".

President Chirac, however, said that CAP reform could only come about by "looking at all the expenses".

"Today, there is less justification than before for the British cheque," he warned.

British sources insisted that that they would not engage in any discussion over the future of the UK's rebate.

"The reason it is not up for negotiation is that it remains justifiable," said a spokesman last night.