Eurosceptics welcome UK veto

David Cameron's move to veto EU treaty change was welcomed as a "very significant" development by eurosceptic Tory MP Mark Reckless who said it should be the start of a new more distant relationship.

But former foreign secretary Lord Owen accused the Prime Minister of leaving the UK "in a mess" that called into question the credibility of the coalition Government with the Liberal Democrats.

Mr Reckless told BBC Radio 4's Today programme: "The Prime Minister has been as good as his word.

"He said he would not agree to a new treaty unless he was able to safeguard the interests of the City. The other EU countries would not agree to safeguard the interests of the City and therefore David Cameron has said no.

"I think this is a very significant change. All of us will need time to see how the institutions of Europe are going to move forward.

"Nicolas Sarkozy was talking about a re-founding of the European Union. Now we see that is happening among between 23 and 26 countries and we are remaining outside that. That now gives us the opportunity to negotiate a new relationship with the European Union that is in our interests.

"We need to look to negotiate bilaterally, in the same way that Switzerland does, to protect our interests. That is the way this appears to be developing and I think we need to do that to secure our own independence and make our own decisions in our own interests."

He cautioned that France and Germany were still looking to control the UK financial sector.

"Under the Lisbon Treaty, the one we didn't have a referendum on, France and Germany and the EU institutions have got their hands on the City.

"It is now them rather than us who regulate the City and they want to keep it that way - hence they are going through all the inconvenience of setting up new institutional arrangements for between 23 and 26 countries outside the current EU-27 treaties so that they can continue to regulate the City in their interests rather than our."

Social Democratic Party (SDP) founder Lord Owen said: "Why has the Government allowed us to get into this mess? Have we been coherently governed over the last few months? Is this coalition able to really represent British interests or are we being driven by about 80 to 90 Conservatives who really want us to get us out of the European Union?

"This is the first time that a British government has failed to achieve British objectives, which is to remain fundamentally within the European structures, and have to walk away from that so we are in danger of literally being on our own."

There had been "disastrous relationships" developing with EU partners for months, he said.

"Is this coalition credible? What is the position of the Liberal Democrats? Do they agree with this? What is the position of the Labour Party?

"Is there a better form of government for this country? This Government has been a disaster in the area which concerns me, on the economy," he said.

UK Independence Party MEP Marta Andreasen said Britain's role in Europe was "fast becoming a charade".

Ms Andreasen said: "It appears that if the euro is to go down then everyone must stay on board, like the ill-fated band on the Titanic, playing whatever tune Mrs Merkel chooses to hear."

German calls for fiscal union amount to a demand to surrender sovereignty and will be "a recipe for disaster and the effective castration of member states' power", she said.

"Prime Minister Cameron will seek to wriggle out of giving the British people a say on whether this is the type of Europe it chooses to stay in and do business with, albeit in the second division," said Ms Andreasen.

"Now is the time to reassess our position as part of the EU and withdraw. Our role is fast becoming a charade."

Labour's former foreign secretary David Miliband said Mr Cameron's actions showed "weakness not strength".

In a message on Twitter, Mr Miliband said: "UK jumped into rowing boat with Hungary next to 25 nation supertanker. That is weakness not strength."

A flood of MPs used the internet to respond to events in Brussels on their blogs and Twitter.

A number of Liberal Democrats voiced concern at developments.

Lib Dem MEP Andrew Duff wrote sarcastically on his website: "Cameron is to be warmly congratulated on reaching his goal of second-class membership of the EU."

And Cheltenham MP Martin Horwood said: "Worrying picture emerging in Brussels. Worst scenario is UK, Hungary out; 26 others in. Difficult to maintain UK influence from there."

But Tory backbenchers loudly praised Mr Cameron for taking a stand against the direction of travel towards closer European union. Some saw last night's events as the first step towards a looser UK relationship with the EU.

Prominent Tory Eurosceptic Douglas Carswell wrote on his blog: "The inexorable logic of today's non-deal in Brussels is that Britain now heads towards a Swiss-type relationship with Euroland. Or possibly Australian - they seem to be doing OK."

Tory MP for Daventry Chris Heaton-Harris, a former MEP, said: "David Cameron has, yet again, shown true leadership. Wonder how many seconds it would have taken Ed Miliband to give in last night?

"Anyone else noticed the Cameron trait of weighing up all options for a couple of days before choosing what is best and acting decisively?

"Wonder, if in the cold light of day, Germans will worry about where their pact with the French is leading them?"

Harlow MP Robert Halfon said he was "delighted that Cameron has shown bulldog spirit and said no to EU treaty".

Liz Truss (Norfolk South West) said: "PM made absolutely right call in vetoing proposals to damage our economy. Eurozone need to face reality and increase competition not regulations."

Tory MP for Tamworth Chris Pincher said: "David Cameron made a hard decision but the right one. He said no in Britain's interest. Can't imagine Ed Miliband doing that."

And Therese Coffey (Suffolk Coastal) said: "Well done David Cameron - standing up for Britain's interests. 'In Europe, not run by Europe' - true in 1999, in 2001 and 2011. Thank heavens DC out there today not Brown."

Louise Mensch (Corby) blamed European proposals for a Financial Transaction Tax, opposed by the UK, for the break-down in talks.

"Tax proposed was designed by some in EU to destroy UK's competitive advantage in financial services; height of irresponsibility to try it on now," wrote Ms Mensch.

"The PM was absolutely right to refuse to allow the EU to gut Britain's financial services industry. Showing strong leadership."

Nadhim Zahawi (Stratford-on-Avon) said: "David Cameron absolutely right not to sign up to treaty that would threaten 1.3 million jobs in UK financial services."

And Brigg and Goole MP Andrew Percy said: "At last a PM who stands up for Britain in Europe! Amused that pro-EU and pro-euro Labour demanding we should have signed away our interests."

But Labour's Chris Bryant rated the result achieved by Mr Cameron a "fail".

"Cameron has achieved political and economic isolation for UK whilst keeping us in the Common Agricultural Policy, Working Time Directive and common fisheries," said the former Europe minister.

"Not an ounce, not a gram of leadership to his own party, just surrender. So the euro crisis continues and we tip towards recession.

"The euro is no stronger, so our economy will suffer. The others will unite, so we will be excluded."

And shadow Home Office minister Diana Johnson agreed: "Looks like UK taxpayers will pay even more to bail out the eurozone in return for little say in EU decisions that effect our economy."

Former culture secretary Ben Bradshaw sarcastically described Mr Cameron's veto as a "diplomatic triumph".

"So Britain gets blamed if the euro falls apart taking us down with it and our only ally is the nasty regime in Hungary. Diplomatic triumph," wrote the Exeter MP.

Labour MP for Bassetlaw John Mann drew an unflattering comparison with earlier Conservative prime ministers whose political careers foundered on foreign affairs decisions later deemed to be disastrous.

"David Cameron... is he the new Neville Chamberlain or is he the next Antony Eden?" asked Mr Mann.

Labour's former defence secretary Bob Ainsworth suggested that the events of last night have made an early general election more likely. "What are the odds on offer for a February election? I must check today," he wrote.

And frontbencher Diane Abbott said: "Cameron vetoes 'treaty to save the euro'. Putting his survival as leader of the Tory Party above the interests of Europe as a whole?"

Labour eurosceptic Gisela Stuart had a bleak assessment of the result. The Birmingham Edgbaston MP said: "Euro still unsustainable. Greece still uncompetitive. But now we are even more cornered. Some success."

Liberal Democrat MEP Sharon Bowles, who chairs the European Parliament's Economic and Monetary Affairs Committee, warned that the UK now faces "revenge attacks".

She told BBC News: "I think it was quite right to go out there and to protect the single market - if you like, to say we don't want any caucusing, we want to make sure that is done at the level of the 27.

"Well, the best way to do that is to deal with the the 27. If your influence is diminished then it is very bad.

"You can't escape the fact that when things like this happen there are what can only be called revenge attacks.

"There is already mood music within the Parliament that if the UK wants it some people will take a great deal of satisfaction in making sure we don't have it."

Cheltenham MP Mr Horwood blamed Tory Euroscepticism for leaving the UK facing a "worst-case scenario" of isolation in Europe.

He welcomed progress towards a deal to rescue the single currency but said it was not "the ideal outcome from a Liberal Democrat point of view".

"It will make it more difficult for us to exercise the kind of influence that we all want over the future of the European single market and the future of the European economy, of which we are a part," he told BBC Radio 5 Live.

"It is a shame that a deal could not be done on that (financial regulation). But I'm afraid the Eurosceptic rhetoric going into this council did not help that position.

"All the fantasy Eurosceptic demands of wholesale renegotiation of the social chapter and repatriation of powers was all fantasy and that's been exploded.

"But we are nevertheless in a difficult situation."

UK Independence Party leader Nigel Farage said: "The real debate on the European Union in Britain is about to begin. Whether David Cameron knows it or not, his actions last night marked the beginning of the end of Britain's membership of this union.

"I expect in the coming weeks and months for there to be an overwhelming demand in Britain for an in/out referendum."

Mr Farage added: "It is tempting to say 'Well done, David Cameron, for standing up for British interests', but then we realise that he has actually gained nothing.

"His attempt to safeguard Britain's biggest industry has led to Mr Sarkozy telling him where to go.

"The argument that we can repatriate powers from the EU died last night. We cannot have an a la carte menu in future with Europe. They have made it abundantly clear, we can either take it or we can leave it."

Jan Zahradil, the chairman of the European Conservatives and Reformists group to which Tory MEPs belong in the European Parliament, congratulated Mr Cameron and Czech Prime Minister Petr Necas for declining to sign up to the proposed treaty.

Czech MEP Mr Zahradil said: "In a difficult atmosphere, they defended the interests of their citizens and their constituents.

"After yesterday, it is clear that within the EU there is at least a two-tier structure - the euro area and non-euro area - and we will therefore need to find a form of words in the EU treaties which codifies this state of affairs.

"These events have also proved that the so-called 'community' model invoked by euro-federalists for decades has run out of steam. This is proof of the fact that the EU can no longer cling to a 50-year-old dogma.

"For the ECR Group, we stress the importance of not unravelling all of the achievements of European co-operation, in particular the single market, the completion of which is needed more than ever."

Former Europe minister Denis MacShane said last night's events were a victory for Tory Eurosceptics like Bill Cash and that the UK might as well now leave the EU.

The Labour MP for Rotherham said: "There is now little point in Britain staying in the EU.

"Bill Cash has won and I congratulate him and other Eurosceptics on their victory.

"It is an historic turning point and Britain might as well get out now, as Europe's future will be settled without us.

"The 17 plus 6 will decide new rules which will govern trade in financial and other sectors and Britain will have to comply, like Norway or Switzerland, or give up market access."

Tory eurosceptic Bernard Jenkin welcomed Mr Cameron's decision to wield the veto and said Britain would need to completely renegotiate its relationship with the EU.

"This is a very big change to the European Union. Our relationship with the European Union is already very unsatisfactory," he told Sky News.

"This is the moment when we have to start completely renegotiating our relationship. We are going to be a satellite on the edge of what is going to be an economic superpower.

"We need a different relationship. We cannot remain in the treaties as they are currently constructed."

Liberal Democrat MEP Chris Davies accused Mr Cameron of "betraying Britain".

"Far from keeping Britain strong, Cameron has ensured that we will lose our influence at the top table," said Mr Davies.

"By seeking to protect bankers from regulation, he has betrayed Britain's real interests and done nothing in practice to help the City of London.

"The fear now must be that we will increasingly lose the opportunity to affect decisions being taken that are bound to affect us.

"The consequence of the xenophobic attitudes towards our European neighbours that have been allowed to develop has been to leave Britain weak. We have shot ourselves in the foot."

Eurosceptic Tory MP Bill Cash told Sky News: "We are now embarked on a very serious, responsible path towards renegotiating in a fundamental way the whole of our treaty relationship with the European Union.

"The Germans and the French precipitated this with their demands, throwing down the gauntlet and saying we had to do what they wanted.

"Now, David Cameron quite rightly has said 'no, we are not going to do that'.

"There is a real question, however, about the way in which we go forward from here. It has to be fundamental renegotiation of our relationship, it is implicit in the path that has been set.

"This is a historic moment for Europe."

The leader of Mr Cameron's Tory MEPs, Martin Callanan, said the Prime Minister deserved praise for standing up for Britain and refusing to be "bullied or browbeaten" by France and Germany.

"I have no doubt they will try to portray him as the villain of the piece, but he was only doing what all member states do in protecting their own national interests," he said.

"David Cameron was absolutely correct to wield the UK veto which blocked plans for a new EU treaty."

Mr Callanan went on: "To have bargained away Britain's rights, freedoms and economic well-being would have been unthinkable. If Merkel and Sarkozy hoped he would be craven enough to do it, they know differently now.

"The next thing they need to realise is that in reality Mr Cameron has helped them too. A new treaty may help solve the next crisis, but it would come too late to solve this one."

He added: "They now need to get on with stabilising the euro however they can, if necessary by jettisoning some of the baggage dragging it down. They should start by telling Greece her time is up."

London Labour MEP Mary Honeyball described the summit outcome as a "disaster".

She said: "David Cameron has vetoed the proposed treaty on the euro involving all 27 member states because he is so incapable. He failed to adequately negotiate a situation which would ensure Britain is kept in the process.

"Such a loss of power is not helpful for the UK and it's imperative that we continue to be part of future negotiations with the euro zone. A two-tier Europe, which may well result from this, would be disastrous for the UK and as a result we will not be able to fully protect British interests, as Sarkozy has already pointed out."

She predicted domestic fall-out: "Nick Clegg is, as we know, very pro-European and yet he is also part of a Government which has loosened ties with the EU and lost the respect of European heads of state.

"This will undoubtedly have implications for the survival of the coalition. And globally there are massive implications - markets have fallen and during this uncertain time it will continue to hit the already fragile global economy."

Lithuanian President Dalia Grybauskaite, arriving for this morning's summit session said Mr Cameron had put Britain "out of the decision-making process".

Senior Lib Dem peer Lord Oakeshott accused Mr Cameron of undermining Britain's influence in Europe and putting the interests of the City above the wider economy.

"It is a black day for Britain and Europe. We are now in the waiting room while critical decisions are being taken," he said.

"By pulling out of the main centre-right grouping in Europe and linking up with the wackos and weirdos in eastern Europe instead, David Cameron has seriously undermined Britain's influence.

"With the western economies and our banking system on the edge of a cliff, we should not be putting special pleading for special interests in the City of London above our vital national interest of working closely together with Germany and France to keep our economy and jobs all over Britain safe."

Business Secretary Vince Cable said Britain had a "critical interest" in protecting the single market. The priority now was for the eurozone to sort out its financial crisis.

"Hundreds of thousands of British jobs depend on the eurozone crisis being resolved. I think they will do that but we will see what happens over the next few days," he told Sky News.

"The key national interest we are trying to protect here is the single market, which very large numbers of British jobs depend on in all sectors of the economy in all parts of the country.

"We have critical interest in keeping the single market, keeping it open, enlarging it. That's what's the argument is about."

PA