Blair attacks Chirac over EU reforms

Tony Blair has hit back at the French President, Jacques Chirac, over plans to modernise the European economy, insisting Britain has the backing in Europe to push through a controversial package of economic reforms opposed by the French.

Tony Blair has hit back at the French President, Jacques Chirac, over plans to modernise the European economy, insisting Britain has the backing in Europe to push through a controversial package of economic reforms opposed by the French.

Reopening a diplomatic rift with Paris, he said it would have been a "grave error" to scrap the British-backed services directive designed to open up a large part of the European economy to competition.

Mr Blair said that no one country would have a veto on the reforms, declaring: "It is a debate in which we have allies."

Mr Blair also dismissed M. Chirac's calls for an end to Britain's £3.5bn budget rebate, insisting that it was never raised at the European council meeting earlier this week.

M. Chirac claimed victory this week after EU leaders agreed to his demand for the directive to be redrafted. But Mr Blair played down the changes, saying it was "inevitable" amendments would be made to the draft directive.

Downing Street insisted Britain had the support from new EU states to push the measure through, dismissing opponents as "in the minority". Britain believes the directive, designed to break down barriers to the trade in services across Europe, could create 600,000 jobs. But the planned legislation is unpopular in France where it has raised fears that East European firms could undercut domestic companies.

The Conservative leader Michael Howard told MPs in the House of Commons yesterday that Mr Blair was "a complete failure" in the EU negotiations and taunted the Prime Minister over M. Chirac's call for an end to Britain's budget rebate. The summit, he said, "encapsulates the Prime Minister's complete failure on Europe over the last eight years".

Mr Howard accused the Prime Minister of "surrendering" to M. Chirac over the reform directive: "You put the interests of the French president before those of British workers and consumers so how can we trust your promises on the rebate?"

Mr Blair insisted that Britain's rebate was not formally debated at the meeting. "It is true it was mentioned by the French president - it always is - and it gets the same response from me which is no and that is what will continue to happen."