Tories' demands for block on EU constitution are foolish, Blair says

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Tony Blair has dismissed as "foolish", Tory demands for him to block the proposed European Union constitution at a crucial summit of EU leaders in Brussels today.

Tony Blair has dismissed as "foolish", Tory demands for him to block the proposed European Union constitution at a crucial summit of EU leaders in Brussels today.

A new draft tabled by the EU's Irish presidency last night offered two important concessions to Mr Blair, and sweeteners for countries including Germany, Spain and Poland. EU officials were increasingly optimistic that agreement could be reached at the summit.

The latest blueprint scraps proposals to introduce majority voting in limited areas of taxation policy, opposed by Britain. It also suggests writing a new clause into the text of a controversial Charter of Fundamental Rights, guaranteeing that no new legal obligations are created. Britain was worried the charter could have jeopardised Britain's industrial relations laws, including curbs on the right to strike. The concessions should enable Mr Blair to secure his much-vaunted "red lines".

The summit's most likely stumbling block is over the voting power of member states in the Council of Ministers, the EU's main decision-making body, which led to the collapse of the EU summit last December. But the latest draft offered a compromise to make it easier for nations such as Poland and Spain to block measures they dislike.

Originally, EU legislation would have needed the backing of half of all member states representing 60 per cent of the EU's population. Under the new Irish plan, those thresholds would be raised to 55 per cent and 65 per cent respectively, and the three biggest nations could not block a measure alone. In a move to reasssure Poland, the Irish suggested a new mechanism under which countries could appeal if they find themselves in a worse position than under the present system.

Last night, Gordon Brown, the Chancellor, warned that the treaty must recognise "new economic realities". He said Britain's opposition to majority voting on tax and to the European Commission taking charge of fiscal policy were "not founded on dogma as some allege but on a concrete assessment of Britain's national interest and Britain and Europe's economic needs as we meet the challenges of the global economy".

He added: "Europe must avoid endorsing a federal-style fiscal policy which would make the commission and not member states responsible for fiscal discipline. That is why, while tackling unfair tax competition, Europe must avoid the tax harmonisation that would damage our competitive position."

Fears among pro-Europeans that the strong support for Eurosceptic parties would make it difficult for Mr Blair to win the promised referendum on the constitution were allayed by a NOP poll for the Britain in Europe group. It found that almost half of people have not made up their minds or are open to persuasion on how to vote.

Twenty-eight per cent would vote "no", twice as many were certain to vote "yes", and a further 17 per cent would probably vote "no" but could be persuaded otherwise. Lucy Powell, the group's campaign director, said: "There is still all to play for in the public debate on the proposed treaty. Most people in Britain have not made up their minds or are still open to persuasion. Indeed, most do not even know what the referendum is about." Yesterday Mr Blair clashed with Michael Howard, the Tory leader, who dismissed his "red lines" as "red herrings". He told Mr Blair during Prime Minister's questions: "Even if you get all your red lines it involves giving up more than 20 of our vetoes. If I were in your place, I would say 'no'. The British people want you to say 'no'. Which part of the word 'no' don't you understand?"

Mr Blair said the constitution would allow small groups of EU states to press ahead with further integration, in line with Tory policy. He said: "The provisions for enhanced co-operation in this treaty precisely allow other people to go ahead if they wish to do so, which is why it would be particularly foolish for us to veto the entire treaty."

He told Mr Howard: "It's about time you showed a bit of proper leadership and instead of running towards the UK Independence Party (UKIP) shouting 'me too', that you actually stood up with them and took on the argument."

Jack Straw, the Foreign Secretary, praised yesterday's front page of The Independent highlighting the cost of withdrawing from the EU, as UKIP demands. He told the Commons: "It means being obliged to apply EU legislation but having no say in deciding it. It means contributing to the EU budget but getting almost nothing back. Norway alone is paying €230m (£151m) year to finance EU enlargement.

"It means British exporters, who can today trade free of obstacles throughout Europe, would have to fill out a 12-page form every time they wanted to send their products across the Channel, extra red tape, extra costs and extra delays."