Blair says that giving up veto `may be best'

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TONY BLAIR insisted yesterday it was "entirely sensible" to give up the national veto in some areas of European policy because to do so would serve Britain's best interests.

The Prime Minister stressed during Question Time that Britain would have been unable to secure the lifting of EU's world-wide ban on British beef exports or the completion of the European Single Market without the extension of qualified majority voting (QMV).

But during several exchanges, William Hague claimed it was "vital" Britain maintained its veto within the EU at a time when the Labour Party was signing up to a "socialist manifesto" which would prepare for a federal Europe.

The Tory leader challenged Mr Blair to spell out whether he agreed with Labour MEPs' leader Pauline Green "when she says we should abolish Britain's veto over asylum, immigration and every aspect of foreign and security policy".

"Shouldn't we be arguing not for giving up Britain's veto but for maintaining it and, when the interests of the country are at stake, as with the withholding tax, using it?," he said.

Replying, Mr Blair made clear that the Government was determined to keep the national veto in areas such as defence and taxation. "But we do not take the view of the Conservative Party, which is to say that they are now opposed to any extension of QMV in any set of circumstances."

During another exchange, the Prime Minister added that the Government supported independent auditing of MEPs' accounts and expenses as well as new rules on financial transparency. "The Conservative Party has actually refused to support those things that would give us the best opportunity of making sure we root out fraud and inefficiency in the EU."

But the Tories later sought to expand on the Government's failure to combat fraud within the EU during a debate on the issue. Shadow Chancellor Francis Maude said the planned Fraud Prevention Office, set up within the Commission to prevent the European Commissioner's abuse of power, was not sufficiently independent.

Mr Maude also referred to the accusations against Glyn Ford, a Labour MEP, who allegedly financed his household costs with taxpayers' money. "So Labour's claim to be tough on fraud is really pretty thin," he said. However, Commons leader Margaret Beckett has made clear there would be an inquiry into Mr Ford's conduct.

"Labour is so committed to being at the heart of Europe that it failed to take any real steps to combat fraud," Mr Maude added.

But Alan Milburn, the Chief Secretary to the Treasury, insisted that if Britain wanted to "start tackle fraud, it would have to it as part of wider reforms, with strong leadership and constructive engagement within the European Union".