Britain edges into the heart of Europe

Four months after Tony Blair was isolated and embarrassed at a fractious summit in Helsinki last December, something strange is happening in Europe: Britain is chalking up some policy successes.

Behind the scenes the Government has done a deal over one awkward issue, switched tack on another and out-manoeuvred France at a European summit. This metamorphosis has even seen the Chancellor, Gordon Brown - a man who seems to specialise in irritating his European colleagues - emerge from a discussion on tax without being the villain of the piece.

The explanation? Throughout much of its recent history European policy-making has been dominated by a powerful triumvirate made up of Bonn, Brussels and Paris and personified by Helmut Kohl, the former German Chancellor, François Mitterrand, the former French president and Jacques Delors, last-but-one president of the European Commission. But, according to some British diplomats, the Franco-German alliance which has dominated Europe for 40 years has finally been cracked.

Levering open that relationship has been a Foreign Office ambition for almost a generation. One French diplomat remembers how, early in his career, he was among a group of high-fliers from Paris brought on an expenses-paid goodwill trip to Whitehall. The visit was a great success, but the invitation was never returned. Instead French efforts were concentrated in a different direction: towards Bonn. The two countries are linked, not only by treaty, but by informal ties which bind politicians and civil servants. German officials tend to know and consult their opposite numbers in Paris and vice versa.

But the departure of Helmut Kohl from the German chancellery in 1997 marked a turning point in attitudes to the EU, as the new government looked less at what it could do for Europe and more at what Europe could do for it.

Franco-German relations became particularly strained over funding of the EU during the Agenda 2000 negotiations a year ago. Meanwhile traditional areas of political co-operation were reaching their natural conclusion. During the 1980s French economic policy was geared to linking the franc to the deutschmark, an objective which has, with the launch of the euro, been achieved.

One of France's next political ambitions concerns Europe's nascent defence policy, something which involves increased co-operation with Britain. Simultaneously Germany's growing self-confidence has reduced its need for Paris to lend legitimacy to a country once gripped by Nazism.

But more important is the shift of emphasis in the EU to areas where the European Commission has no competence. In these domains - justice and home affairs, foreign and security policy, defence - power is balanced more equally among the 15 member states represented in the Council of Ministers.

The result is what many see as a vacuum at the heart of policy-making (one that has prompted criticism of the luckless European Commission president, Romano Prodi). As one European diplomat put it: "We are probably in a critical process of change in the nature of the EU. With the enlargement of Europe and policies like defence and security, trade policy and justice and home affairs, it is more difficult to see where we are going."

Mr Blair, who has cultivated premiers such as Jose Maria Aznar of Spain, Wim Kok of the Netherlands, Antonio Guterres of Portugal and Guy Verhofstadt of Belgium, has seen an opportunity. At last month's Lisbon summit the agenda was set not by France and Germany, but by a collection of other member states, including the UK, Portugal, which holds the EU presidency, Spain and the Netherlands. The UK has manoeuvred itself into a stronger position by settling a long-running dispute over a directive imposing an artists' levy on the re-sale of their works. A week ago Mr Brown even won support from several countries for his ideas on combating tax evasion.

This is, however, no revolution. Outside the euro there are limits to British influence and the UK is excluded from the important meeting of finance ministers from countries which take part. And constructed over a generation, the Franco-German alliance remains the most important bilateral relationship in Europe.

When Germany needed support for its candidate for the top International Monetary Fund post, France obliged; Paris has led the charge to isolate Austria over its inclusion of the far-right Freedom Party in government, backed by Berlin. Moreover the debate on how to deepen the EU, perhaps by allowing a multi-speed Europe to take shape, will be influenced more by Paris and Berlin than London.

Not only will such decisions be taken while France holds the EU presidency later this year, but they also fall into one area where co-operation between the French and the Germans has always been strong: European integration.

Nevertheless the EU has changed. The familiar pattern of Franco-German domination, driven forward by a powerful European Commission, has given way to a more complex patchwork of shifting alliances allowing a range of countries to set the pace - including Britain.