The surprise £1.7bn bill from the EU sums up the Conservative Party’s dilemma on Europe: David Cameron is caught between the legal obligations of European membership and the moral expectations of the British electorate.

Cameron’s angry speech denouncing the amount was a strategic no-brainer. The speech wrote itself and was the only real response available to the Prime Minister. However, both UKIP and EU officials were quick to point out the fact that this isn’t a polite request, it’s a legal obligation.

Non-payment is simply not an option, as fines will mount and the UK’s political capital in Europe will dissolve very quickly. The only hope for this government is to trust its diplomats to negotiate a lower amount across a longer time span, but one polls shows that 75% of people say that the UK should refuse to pay even a discounted amount.

Is there a level of compromise that will convince UK voters that they have received a fair deal? Even a 50% compromise will result in a £850m bill, enough to fund over 16,000 ward nurses or whichever equivalent the UKIP press release runs with. Anti-EU campaigners will argue that this bill amounts to around £40 for every working person in the UK, and the people voting in the upcoming Rochester and Strood by-election will be listening.

Unfortunately, for the Conservative Party, this is exactly the sort of issue which strikes at people’s perceptions of fairness and plays into UKIP’s hands. Whilst it is difficult to explain the methodologies of how such a bill is formulated, it is very easy to ask people on their doorstep if they think it’s fair that they have to fork out cash to Europe for no obvious reason.

British perceptions of fairness are instinctive rather than political. UKIP are gaining political momentum because they are tuning into the public’s sentiment that the UK’s relationship with the EU just isn’t fair to the British people. Conversely, not enough has been done to clarify what exactly the benefits of membership are to working families on a day-to-day basis; for example, the phrase ‘Single Market’ means very little to most voters.

UKIP can make as much political hay out of this bill as they like because they will never be in a position to actually have to face the legal issues surrounding EU rules on fiscal requirements. The Prime Minister, on the other hand, is bound by reality and knows that the UK can’t not pay. Given that more than half of people still believe that he should refuse to pay a penny, it is inevitable, therefore, that the Tories will be damaged by the episode.

So what next on the home front? Ultimately, the Tories will have to spin whatever compromise is agreed as progress. Given that merely a discount won’t assuage public discontent, Cameron will be looking for a ‘win’ on EU budget reform that he can hold up to the voters as a step forward in the long-term. Tory spin doctors will then look to argue, “only the Conservatives could have won this concession.”

Tory strategists know that they can’t out-UKIP UKIP, and will admit the Party will be damaged in the polls on this bill. In the short term, current political intelligence indicates that this episode will probably extinguish what flickering light was left of the Tories’ hopes of winning the Rochester and Strood by-election. In the longer term, it’s crucial that the Conservatives get something for their money in terms of reform, so that they have a counter ready when this episode comes back to haunt them again in May.