Britain still isolated as EU leaders refuse to bow to treaty demands

Britain looked isolated on the eve of an important summit of European Union leaders after Tony Blair failed to win enough concessions to enable him to agree to a new governing EU "mini-treaty."

The Prime Minister signalled he had not yet secured enough safeguards on his "no-go areas" to enable him to sign up to a watered-down version of the EU constitution rejected in referendums in France and the Netherlands two years ago.

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At the Brussels summit, which opens today, Mr Blair will come under enormous pressure from Britain's EU partners not to scupper their attempt to streamline the Union's working practices. But he will also be under pressure from his successor Gordon Brown, who will monitor developments from London, not to give ground and accept a treaty that he would not want to inherit.

The prospects of Britain being the stumbling block to an agreement rose when Poland, the other potential deal-blocker, softened its line in a row over the voting power of member states. Polish officials said Germany, which holds the EU's rotating presidency, had acknowledged the problem in its latest draft statement for the summit.

Jaroslaw Kaczynski, the Polish Prime Minister, said Poland was ready for a compromise because the EU's drive to replace the now defunct constitution with a slimmed-down treaty seemed unstoppable.

The latest draft included some concessions to Mr Blair but British officials insisted they did not go far enough to protect his "red lines", which aim to protect Britain's ability to decide its own foreign and criminal justice policies, tax and social security rules and employment conditions. "It will be a very hard discussion," said his official spokesman.

There was frustration in London that Nicolas Sarkozy, the French President, and Angela Merkel, the German Chancellor, who will chair the talks, had not moved further to secure Mr Blair a deal he could sign. "The outcome of the summit will affect relationships in Europe for a long time," said one British source. However, the French presidency stressed yesterday that Mr Sarkozy's discussions with Mr Blair and Mr Brown on Tuesday had been "positive and useful" .

But Mr Blair's much-vaunted "red lines" prompted some dismay in European capitals - particularly Britain's sudden wariness of a Europe foreign minister and insistence that the treaty should not displace the role of the British foreign secretary.

"This is a crazy policy," said Charles Grant, director of the Centre for European Reform. "This is reopening a policy that Britain invented to avoid having a conductor with two orchestras" in Europe.

Germany's 12-page draft "reform treaty", seen by The Independent, does contain some blocks on which Mr Blair will aim to build at the summit. It says that although there is no agreement on the name for a European foreign minister, "the common foreign and security policy shall be put into effect by the Union and by member states."

One diplomat familiar with the text said that "it seems as though British demands have been met."

European diplomats said Mr Blair had thrown up the obstacles in order to ensure that Mr Brown could endorse the British negotiating position, while at the same time playing to Britain's Eurosceptic press. "I don't believe the concerns are particularly substantive," said one. "It's the usual presentational game."

EU officials said the issue of Poland's voting power was considered to be a much more likely deal wrecker.

Blair and Europe

May 1997

Tony Blair wins power and sends early signal of pro-Europeanism by ending Britain's opt-out from EU's social chapter of workers' rights

October 1997

Gordon Brown announces that Government has effectively ruled out joining euro before next general election

November 2001

Blair says: "The history of our engagement in Europe is one of opportunities missed in the name of illusions"

January 2002

Euro is launched in 12 countries - but Britain stays out

March 2003

Iraq invasion by US and British troops causes rift with EU partners

June 2005

UK referendum on EU constitution shelved after "No" votes in France and Netherlands

May 2007

Nicolas Sarkozy elected French President, raising prospect of a close working relationship between Britain, France and Germany