PRIME Minister David Cameron was under growing pressure to deliver on his promise to repatriate powers from Brussels last night as Eurozone leaders argued over the terms of their bailout fund.
Cameron has come under fire for giving mealy-mouthed promises on the powers he aims to return to Westminster.
He told reporters: “These are important talks and we need obviously to get that stability in the Eurozone that’s good for European countries, good for Britain as well, but also we need to protect Britain’s interests.”
Thirty backbench Conservative MPs and lords yesterday wrote an open letter warning that the EU’s regulatory initiatives “pose a grave threat to Britain’s financial services industry… It is imperative that the government fights our corner”.
But Eurozone leaders are not interested in discussing what powers London can get back: they are focused on solving the Eurozone’s debt crisis.
Eurogroup president Jean-Claude Juncker told Cameron not to ruin prospects of a deal: “I would like a treaty deal that commits the 27 [EU states] but if it turned out that there were countries among the 27 unwilling to go along with us… we will do it with 17 [Eurozone states],” he said. “I don’t want the United Kingdom setting aside entire pages to say the United Kingdom will not do what all the others have to do.”
Last night, draft resolutions were said to contain a suggestion that the region’s bailout fund, the European Stability Mechanism (ESM), be given a banking license so that it can lend and borrow money more freely.
But Berlin shot down that idea speedily. Chancellor Angela Merkel is nervous of allowing the ESM to be given a freer rein because it will mainly be backed by German money.
Eurozone leaders are expected to unveil a “new fiscal compact” today that will strengthen existing treaties that limit how much of a deficit a country can run up.
It would impose automatic punishments on countries that break the rules unless a qualified majority vote against such measures.
But it is not clear whether today’s round of summit talks will also bring a commitment to reform the Eurozone’s less competitive economies to make the currency union more coherent.
Meanwhile, EU banks were told yesterday that they need to raise €115bn (£97.6bn) to shore up stability in the wake of recent stress tests.