BERLIN (Reuters) - Dutch Prime Minister Mark Rutte on Friday rejected the notion that the European Union is on an inevitable path towards greater political integration after Britain leaves next year, and he called for a narrower focus on projects with an economic payoff.

FILE PHOTO: Netherlands' Prime Minister Mark Rutte arrives at a European Union leaders informal summit in Brussels, Belgium, February 23, 2018. REUTERS/Francois Lenoir

In a speech in Berlin, Rutte criticized the language of “ever closer Union” enshrined in the bloc’s fundamental treaties, saying it should act only where collective action was most appropriate, and do so with a smaller budget.

“There has been this narrative that there is this inevitability of closer cooperation in a European federal state. This horrible language about ‘ever closer Union’ I don’t like,” he told an audience of diplomats and politicians.

Distancing himself from what he called a romantic vision of political union, he said the fixation on deeper integration had been a big factor in Britain’s 2016 vote to leave the bloc.

The Netherlands has lobbied for favorable exit terms for Britain, its second-largest trading partner, but would support whatever deal the European Commission negotiates.

Rutte spoke as British Prime Minister Theresa May prepared to outline her plans for Britain’s relationship with the EU after it departs - an event that Rutte said must lead to a shrinkage of the bloc’s budget.

In her speech, May urged the EU to show more flexibility in talks on a future relationship, saying Britain was ready to swallow the “hard facts” of Brexit but did not believe they should prevent a successful trade deal.

The Netherlands was a founder member of what later became the EU but its keenness for European integration has cooled over recent decades. Rutte faces stiff competition from a handful of euroskeptic parties to the right of his pro-business Liberals.

But while Rutte’s speech contained proposals for deepening cooperation in several areas, including security and market regulation, his criticism of terminology that has been a central tenet of the bloc since the 1980s will draw attention.

“In the past 20 or 30 years this has moved from ever closer union of the peoples of the EU working together on collective issues where member states weren’t able to deal with it themselves, to become an inevitable goal in itself,” he said.

Dissatisfaction over EU budget contributions has become a burning political issue in the Netherlands, which is usually the largest contributor to the EU budget on a per-capita basis.

Rutte said cutting the 70 percent of the EU budget that goes to agriculture and development funds would make room for spending on other priorities, including strong border controls and military infrastructure.

Funding for European development projects should be tied, he said, to recipient states’ willingness to carry out structural economic reforms, a suggestion backed by the Commission.

He also called for the creation of a mechanism for restructuring the debts of member states in fiscal difficulties and said the EU’s single market could be deepened by scrapping rules for notary guilds and other “protected professions.”