Boris Johnson has said he can see himself voting for Britain to leave the European Union, opening up the possibility of him heading the 'Out' campaign that would pit him directly against David Cameron and George Osborne.
The Mayor of London described reports that the Prime Minister had ditched plans to exclude Britain from a wide range of EU employment and social laws as "very disappointing".
He said it was very important that Mr Cameron won opt-outs for the UK's flexible labour markets from what he described as the EU's over-regulated employment laws.
Asked whether there was a set of circumstances in which he could see himself voting for the UK to quit the EU, Mr Johnson replied "Yes of course... of course, I think it is important."
He was speaking after the Financial Times reported that Downing street had scrapped demands for Britain to be fully excluded from the EU Social Chapter, which Sir John Major opted out of in 1993 but Tony Blair abandoned the opt-out after winning his landslide election in 1997.
It is not the latest concession the Prime Minister has been forced to make, however. This morning Downing Street said it had accepted the recommendation from the elections watchdog that the EU referendum question be amended in order to avoid bias.
The referendum, to be held before the end of 2017, will now ask voters whether they want to remain in the EU or leave it, replacing the 'Yes' or 'No' format previously proposed.
Asked on his monthly phone-in with LBC listeners what would be the deal breaker when it came to him deciding which side he would vote for, Mr Johnson said: "I think that we've got to hold out, we've got to hang very tough.
"But I think, I looked at the headlines this morning, about the possibility of Britain dropping its insistence on changes to employment law.
"And I thought that was very disappointing, I think we need to move forward on that. I think one of the reasons we've got low growth in Europe is not just the travails of the Eurozone, but also because we've got too much regulation, too much stuff coming from Brussels, too many laws that are promulgated by Brussels that make it hard for business.
"I think we need to weigh in on all that stuff, all that social chapter stuff. And, you know, I've got every confidence that the Prime Minister will do that."
Eurosceptic Tory MPs
Eurosceptic Tory MPs
1/7 Owen Paterson
Formerly a cabinet minister, Owen Paterson is now free to make his opinion known on the backbenchers. On the subject of Europe, he does so regularly – claiming recently that the EU referendum was “rigged” in favour of staying in
2/7 John Redwood
A longstanding eurosceptic, Mr Redwood warned last year that businesses that spoke out in favour of EU membership would be punished at the check-outs by anti-EU
3/7 Bill Cash
Awkward squad rebel Bill Cash said last year that he thought the EU had become an undemocratic, German-dominated project. “An increasingly assertive German Europe is at odds with British national interests,” he wrote in the Daily Telegraph
4/7 Philip Davies
From the Conservative party’s hard right wing, Philip Davies has been a longstanding critic of the EU. He founded the Better off Out campaign and is so eurosceptic that Ukip decided not to stand a candidate against him in 2010 because they agreed with him
5/7 Nadine Dorries
Outspoken Tory MP Nadine Dorries has previously advocated an alliance with Ukip. At the height of the Greek crisis in 2013 she said that the EU was “dying on its feet”
6/7 Liam Fox
The former defence secretary is a central figure on the right wing of the Conservative party. He’s long put pressure on David Cameron over EU negotiations
7/7 Zac Goldsmith
A socially liberal eurosceptic, Goldsmith was one of the founding members of the People’s Pledge campaign to get MPs to sign up for an EU referendum. His father ran the Referendum Party, a precursor to Ukip