New eurozone pressure on David Cameron


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Indy Politics

Prime Minister David Cameron came under renewed pressure over Europe today on the eve of a crunch summit as London mayor Boris Johnson called for a referendum if the talks result in a new EU-wide treaty.

And a member of Mr Cameron's Cabinet, Northern Ireland Secretary Owen Paterson, suggested that a referendum will be an "inevitable" result of proposals for closer fiscal union in the eurozone.

Mr Cameron promised the House of Commons today that he would safeguard Britain's interests at the European Council summit in Brussels on Thursday and Friday, when leaders of the 27 EU states will discuss a Franco-German plan for closer fiscal co-ordination between the 17 countries which use the euro.

The Prime Minister insisted he wanted "more power and control" for the UK to protect the financial services sector and the City of London, and would adopt the approach of demanding more for Britain the more that other countries asked for.

But Labour leader Ed Miliband said the Prime Minister was being sidelined in Europe, and accused him of going back on promises to Tory backbenchers that he would use any future treaty changes to repatriate powers.

Mr Miliband told a raucous Commons that Mr Cameron had been "promising his backbenchers a handbagging for Europe, now he is just reduced to hand-wringing".

But Mr Cameron rejected his accusations, saying: "We will insist on safeguards for Britain. That means making sure we are stronger and better able to do things in the UK to protect our national interests.

"The more the countries of the eurozone ask for, the more we will ask for in return."

Moments after the clash at Prime Minister's Questions, Mr Johnson took to the airwaves to insist that any treaty signed by all 27 EU states that creates fiscal union within the euro area should be either vetoed by the UK or put to a public vote.

Mr Johnson told BBC Radio 4's The World At One: "If Britain was asked to sign up to such a thing within the 27, it would be right for us either to veto it... If we felt unable to veto it, then certainly it should be put to a referendum."

Mr Paterson is understood to have told The Spectator magazine: "If there was a major fundamental change in our relationship, emerging from the creation of a new bloc which would be effectively a new country from which we were excluded, then I think inevitably there would be huge pressure for a referendum."

Asked whether a referendum will be required, he replied: "I think there will have to be one, yes, because I think the pressure would build up. This isn't going to happen immediately because these negotiations are going to take some months. But I think down the road that is inevitable."

A source close to Mr Cameron tried to play down the significance of Mr Paterson's remarks, telling reporters: "It's a difficult issue and I think Owen was trying to be helpful."

At Prime Minister's Questions, Mr Cameron faced a barrage of questions from all sides of the House over the upcoming European summit.

Tory backbencher Andrew Rosindell urged him to show "bulldog spirit" at the talks.

And the Prime Minister responded: "That is exactly what I will do. The British national interest absolutely means that we need to help resolve this crisis in the eurozone.

"It is freezing the British economy just as it is freezing economies right across Europe."

He made clear he was ready to use Britain's veto power to block any EU-wide treaty which was not in the UK's interests.

And he suggested that non-euro states like Britain will still retain some influence over a possible agreement between the 17 eurozone states, as their approval will be needed for EU institutions - such as the European Commission and European Court of Justice - to support the new arrangements.

Mr Cameron told MPs: "Let's be clear that there is an option of a treaty at 27 where we have the ability to say yes or no and as a result get a price for that.

"But there is always the possibility that the eurozone members at 17 will go ahead and form a treaty of their own.

"Again we have some leverage in that situation, because they need the use of EU institutions, but we should recognise what that leverage is and make the most of it."

Tory backbencher John Baron (Basildon and Billericay) said that Mr Cameron should use the summit to demand "a fundamental renegotiation of our relationship with the EU based on free trade and competitiveness ... and not political union and dead-weight regulation".

And Andrew Turner (Isle of Wight) said the UK should be seeking treaty changes on immigration, employment and fishing rights.

Julian Lewis (New Forest East) said the Government should not support eurozone fiscal union, which he said would create a "dangerously undemocratic single government" for those in the single currency.

And Father of the House Sir Peter Tapsell said fiscal union would "pose a great threat to the whole of the liberty of Europe, because it will inevitably make Germany still more dominant".

Mr Miliband reminded MPs that, faced with a rebellion by 81 Tory MPs over Europe in October, the Prime Minister had said that any future treaty change would present an opportunity to repatriate powers from Brussels to Westminster.

But the Labour leader said that, in a newspaper article today setting out his strategy for the talks, Mr Cameron made no mention of repatriation of powers.

The PM was "caught between his promises of opposition and the reality of Government" and as a result "Britain is losing out in Europe", said Mr Miliband.

"The problem for Britain is, at the most important European summit for a generation that matters hugely for families and businesses up and down the country, the Prime Minister is simply left on the sidelines."

Shortly after the exchanges, Mr Johnson - a fierce opponent of eurozone fiscal union - was asked in a BBC interview if he believed there should be a referendum in the event of a 27-member treaty change.

He replied: "Absolutely. The real problem we have got now is everybody is desperately scrabbling around to try and patch this thing together and to keep the euro in its current form whole and not to let anybody escape, not to let anybody devalue and - to use the rather graphic phrase of someone the other day - I think we are in danger of saving the cancer and not the patient."

Mr Johnson said a better way forward would be a "managed realignment" that allowed some countries to exit the euro.

"It is absolutely clear to me that if there is a new treaty at 27, if there is a new EU treaty, that creates a kind of fiscal union within the 27 countries or within the eurozone, we'd have absolutely no choice either to veto it but certainly to put it to a referendum," he said.

And he added: "If they are going to go down that route to fiscal union then certainly I think, frankly, it's the wrong way to go and I think we should be opposing it.

"If, on the other hand, they decide 'Look, we can't do this within the EU, we want to go it alone, the 17 eurozone countries are going to go ahead and create such an economic government'... in that eventuality the UK would not be involved, not be a signatory and you couldn't reasonably ask for a referendum."

Immigration Minister Damian Green said the referendum question should be left until after a decision was made at Friday's summit.

"If anyone tried to take control of the British economy and British taxation, then of course any British prime minister, and certainly David Cameron, would oppose it," he told The World At One.

Asked if there should be a referendum, he said: "First of all, let's see what's decided on Friday. This morning's talk out of Brussels is of a protocol to existing treaties. If that's what it ends up as, then putting a protocol to a referendum might seem slightly odd.

"We passed a law to ensure that if powers are transferred from Britain to the European Union, then there has to be a referendum. Within that context, let's see whether it's a treaty of all 27, a treaty of 17, or a protocol or what.

"But speculating hypothetically about what is going to come out of these negotiations is slightly pointless at this stage."

Shadow energy secretary Caroline Flint, a former Europe minister, said Labour backed a referendum if there was "any change to the constitution" of the EU.

She also backed shadow chancellor Ed Balls's declaration yesterday that he could not envisage Britain joining the single currency in his lifetime.

"I do not see it as a big change. We were the people in Government who decided we would not go into the euro, and it was a very well-thought-through decision.

"I am a little bit older than Ed Balls and I can't see it happening in my lifetime either," she said.

Asked if Mr Balls consulted colleagues before setting out his position, she said: "We have discussions around our economic policy and what we are doing. We have made it clear the euro, joining it, is not on the agenda for Labour."