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Tony Blair warns David Cameron against creating 'two speed' Europe Tony Blair warns David Cameron against creating 'two speed' Europe
(about 1 hour later)
Tony Blair challenged David Cameron's approach to the crisis in the eurozone today when the former prime minister warned that creating a two speed Europe would set the EU "on a path to break up". Tony Blair challenged David Cameron's approach to the crisis in the eurozone today when the former prime minister warned that creating a two-speed Europe would set the EU "on a path to break up".
As Downing Street braces itself for a possible commons defeat on Wednesday - if Labour sides with Tory eurosceptics to call for a real terms cut in the EU budget - Blair called on Britain to play a "constructive role" in shaping the new EU. As Downing Street braces itself for a possible Commons defeat on Wednesday – if Labour sides with Tory Eurosceptics to call for a real terms cut in the EU budget – Blair called on Britain to play a "constructive role" in shaping the new EU.
In one of his most important speeches on the EU since leaving office, the former prime minister told the Council for the Future of Europe in Berlin: "It is massively in Britain's interest not to play short-term politics with this issue. Personally I would like to see the UK take a constructive role in shaping this new union." In one of his most important speeches on the EU since leaving office, he told the Council for the Future of Europe in Berlin: "It is massively in Britain's interest not to play short-term politics with this issue. Personally I would like to see the UK take a constructive role in shaping this new union."
Downing Street yesterday accused Labour of playing politics with the EU after the party indicated that it might vote on Wednesday with rebel Tory eurosceptics who are demanding a real terms cut in the EU budget. Labour is tempted to side with the rebels, raising the prospect of a government defeat, because Labour formally supports a real terms cut in the next EU budget which runs from 2014-2020. Downing Street accused Labour of playing politics with the EU after the party indicated it might vote on Wednesday with rebel Tories who are demanding a real terms cut in the EU budget. Labour is tempted to do so, raising the prospect of a government defeat, because the party formally supports a real terms cut in the EU budget for 2014-2020.
One No 10 source said: "There is a degree of hypocrisy from the Labour party here. It gave up quite a large chunk of Britain's EU rebate when it was in office."One No 10 source said: "There is a degree of hypocrisy from the Labour party here. It gave up quite a large chunk of Britain's EU rebate when it was in office."
Labour will decide today or by tomorrow morning whether to support the Tory rebels, led by the backbencher Mark Pritchard, who believes that Cameron should toughen his stance in the budget negotiations. The prime minister will call at the next EU summit, which begins on 22 November, for the EU budget to rise in line in inflation - currently just over 2%. Labour will decide by tomorrow morning whether to support the Tory rebels, who are led by the backbencher Mark Pritchard. The prime minister will call at the EU summit which begins on 22 November for the EU budget to rise in line in inflation – currently just over 2%.
Downing Street believes this is a robust position because the prime minister is opposing the 5% rise in the seven year budget requested by the European Commission. The prime minister has threatened to wield the British veto in the negotiations if fellow EU leaders do not agree to reduce the European Commission's proposed budget. Downing Street believes this is a robust position because the prime minister is opposing the 5% rise requested by the European commission. Cameron has threatened to wield the British veto in the negotiations if fellow EU leaders do not agree to reduce the European commission's proposed budget.
A leading left of centre think tank today calls on Downing Street to negotiate a "grand bargain" with its European partners in which Britain would abandon its multi-billion pound EU rebate in exchange for a 25% cut in the EU budget. The Institute for Public Policy Research says the 25% cut, which would see the budget reduced from £120bn to £89bn, would save Britain £1.2bn from its £12.8bn contribution. This would neutralise any loss from ending Britain's EU rebate. A leading left-of-centre thinktank is calling on Downing Street to negotiate a "grand bargain" with its European partners in which Britain would abandon its multibillion-pound EU rebate in exchange for a 25% cut in the budget. The Institute for Public Policy Research says the 25% cut, which would see the budget reduced from £120bn to £89bn, would save Britain £1.2bn from its £12.8bn contribution. This would neutralise any loss from ending Britain's EU rebate.
Will Straw, associate director of the IPR, said: "Britain should attempt a 'grand bargain' with Europe, offering to give up the rebate, but only in return for a smaller overall budget, meaningful reform of the CAP [Common Agricultural Policy], and greater measures to enhance growth. To ensure that giving up the rebate is palatable to the British public it should be contingent on a reduction in the overall size of the budget so that Britain's contribution to the EU becomes smaller than it is today." Will Straw, associate director of the IPPR, said: "Britain should attempt a 'grand bargain' with Europe, offering to give up the rebate, but only in return for a smaller overall budget, meaningful reform of the CAP [Common Agricultural Policy], and greater measures to enhance growth. To ensure that giving up the rebate is palatable to the British public, it should be contingent on a reduction in the overall size of the budget so that Britain's contribution to the EU becomes smaller than it is today."
In his speech on the future of the EU, Blair steered clear of the row over the budget to focus on what he regards as the broader debate about the future shape of the EU. The former prime minister repeated his call for a directly elected president of the European Commission or European Council as "the most direct way to involve the public" in running the EU. In his speech on the future of the EU, Blair steered clear of the budget row to focus on what he regards as the broader debate about the future shape of the EU. The former prime minister repeated his call for a directly elected president of the European commission or European council as "the most direct way to involve the public" in running the EU.
Blair was careful not to name Cameron. But he issued a stark warning of the dangers of creating a two or three speed Europe as new governance arrangements are created to stabilise the eurozone. He was careful not to name Cameron. But he issued a stark warning of the dangers of creating a two- or three-speed Europe as new governance arrangements are created to stabilise the eurozone.
The former prime minister said: "I can almost feel the relief in some euro-federalist quarters and amongst most eurosceptics at the prospect of a two or three speed Europe. But I would give a stark warning: if eurozone structures end up with a Europe that is fundamentally divided politically as well as economically; rather than a Europe with one political settlement that accommodates different levels of integration within it, the EU as we know it will be on a path to break up." He said: "I can almost feel the relief in some euro-federalist quarters and amongst most Eurosceptics at the prospect of a two- or three-speed Europe. But I would give a stark warning: if eurozone structures end up with a Europe that is fundamentally divided politically as well as economically, rather than a Europe with one political settlement that accommodates different levels of integration within it, the EU as we know it will be on a path to break-up." Cameron and George Osborne have broken with 40 years of British EU diplomacy by embracing a two-speed Europe in which the 17 members of the eurozone would create new governance structures. In a speech in June, Cameron said: "The eurozone … either has to make up or it is looking at a potential break-up. Either Europe has a committed, stable, successful eurozone with an effective firewall ... or we are in uncharted territory."
Cameron and George Osborne have broken with 40 years of British EU diplomacy by embracing a "two speed" Europe in which the 17 members of the eurozone should create new governance structures. In a speech in June, Cameron said: "The eurozone...either has to make up or it is looking at a potential break up. Either Europe has a committed, stable, successful eurozone with an effective firewall...or we are in unchartered territory."