The Edinburgh Summit: Europe bickers back into business: Probably the best treaty in the world: Denmark

THE EDINBURGH summit seemed last night to have brought Europe back from the brink by agreeing a formula on the Maastricht treaty that the Danish government believes its people will accept in a second referendum.

'Six months, nine days and 17 hours after the Danish 'no' we have reached an agreement that will enable us to hold a second referendum. We have got everything we wanted,' said the Danish Foreign Minister, Uffe Ellemann- Jensen, expressing his gratitude for the British presidency's work.

Poul Schluter, the Danish Prime Minister, declared: 'I honestly think that everybody at home will be able to see that the result is so good that we can confidently vote yes.'

Under agreements reached early yesterday, Denmark is exempt from the common defence policy and single currency foreshadowed in the Maastricht treaty. The legal status of this concession was an extremely delicate matter, since it had to satisfy the Danes without invalidating the treaty. Everyone was also concerned that it should not require independent ratification by parliaments.

The result was a package of agreements: a 'decision' taken by heads of government, the basic agreement itself, a statement on legal implications and a statement by the Danes on their understanding of the package.

Although this was greeted with almost unanimous relief as a sign that the EC was back in business, the bitter bickering over the budget and the failure to develop a growth strategy that will have any immediate impact on the recession provided ample evidence yesterday that the movement towards 'ever-closer union' that was the holy grail of the Maastricht treaty has been badly hobbled. The British presidency had talked up the possibility of a summit failure perhaps the better to snatch victory out of defeat.

A senior official confided even before the delegates had arrived: 'Everyone is aware that the stakes are high: that without Denmark there will be no treaty.'

The implication was that the 12 could not afford not to deal and that to ensure that happened, John Major had merely to stand ground and remember his own maxim that success depends on not blinking when the negotiation gets tough.

The accord on Denmark squared a difficult circle. It secured the opt-outs on citizenship, defence, a single currency and co- operation on justice and home affairs that six of the seven parties in the governing coalition government had agreed were the pre- requisites for a second referendum. It also contrived to ensure that such changes did not imply re-ratification of the treaty. To Mr Major's relief, it was agreed not to set any date for final ratification.

Germany proved the hardest member state to convince that the legal form of words drawn up by the British presidency did both these things.

Tempers frayed as delegates complained: 'We've bent over backwards to help the Danes - they must give some ground,' while Mr Ellemann-Jensen explained: 'There is no point making a deal knowing that we will still not be in a position to hold and win a second referendum; we have got to be tough.' Ever persuasive, he explained to his colleagues that polls suggested that 60 per cent of Danish voters would vote 'yes' if asked again, provided Copenhagen's treaty demands were met.

The relief with which the British were able to announce the summit's first success could not, however, detract from a seriously divisive row over the Community's future financing arrangements. Spain held out until the very last, blocking a presidency compromise and demanding that the EC honour a proposal to increase the Community budget to 86.2bn ecus ( pounds 68.4bn) by 1999. In the end Britain had to increase its offer from the original 80.3bn ecus to 83bn ecus.

(Photograph omitted)