Referendum is price of Euro-rebels' votes

Tory Euro-rebels last night spelt out the price of their loyalty in this evening's critical vote on Europe.

After party managers from both sides of the Commons predicted John Major was on course for victory in the Labour-initiated debate, Sir Teddy Taylor, unofficial spokesman for eight of the nine whipless rebels, threw a potential spanner in the works by demanding a referendum on Britain's membership of the EU as the condition of their support.

Sir Teddy said after a meeting of the eight: "The only way to resolve our future in Europe is to hold a referendum so that the people can decide. We want the Prime Minister to give a firm commitment to hold a referendum. If he does, we will support him."

The demand came amid signs of frantic efforts by some of the rebels to stop the eight splitting three ways, with some supporting the Government, some abstaining and some supporting Labour. Some of the group want definite commitments to reform of the Common Agricultural Policy and the Common Fisheries Policy and against a single European currency.

Opposition business managers have calculated that for Labour's motion to succeed, all nine Ulster Unionists would have to support it along with all the other minority parties and a minimum of two Tory rebels, with the other seven abstaining.

There were earlier indications yesterday that at least one rebel, Tony Marlow, the MP for Northampton North, was poised to back Labour, while Richard Shepherd, the MP for Aldridge-Brownhills, said he would vote for the Government.

The Government's amendment to the main motion plays heavily on Labour policy, which "would destroy United Kingdom jobs, erode the UK's competitiveness in world markets, place new bureaucratic burdens on business and industry, destroy the veto and diminish the role of Europe's nation states and their national parliaments".

A key question for Government business managers will be whether those rebels who back the Prime Minister will break rank with their colleagues and accept the party whip.

Tony Blair, the Labour leader, has insisted that there will be no "pandering" to the Euro-sceptics during tonight's debate and there will be no let- up in Labour's war of attrition against the Government. Mr Blair will use the debate to attack Mr Major's administration as a Government without direction. "You can tell a lot about politicians by the buttons they have to press for applause," he will say.

The centrist Tory Reform Group, which includes Cabinet ministers in its membership, yesterday appealed to Mr Major not to appease the "highly vocal minority of self-publicists and right-wing extremists in the Tory party."

Sue Woodroofe, chairman of the group, said: "Moderate opinion will no longer allow itself to be pushed to one side, nor the best interests of Britain, while the unrepentant rebels are courted."

Mr Major warned Teresa Gorman, one of the rebels, in yesterday's Prime Minister's questions that many British interests would be imperiled if the UK were to leave the European Union.

In a speech to the German Society for Foreign Affairs, cleared by the Prime Minister, Douglas Hurd, the Foreign Secretary, yesterday spotlighted the urgent need for a reformed Common Agricultural Policy and a single market free of unnecessary regulation.

Hurd defence call, page 12