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European Council

Volume 583: debated on Monday 30 June 2014

With permission, Mr Speaker, I would like to make a statement on last week’s European Council.

Before turning to the appointment of the next Commission President, let me briefly report back on two other points. First, the Council began in Ypres with a moving ceremony at the Menin Gate to mark the 100th anniversary of the gunshots in Sarajevo that led to the first world war. It is right that we should take special steps to commemorate the centenary of this conflict and remember the extraordinary sacrifice of a generation who gave their lives for our freedom.

The Government are determined to ensure that Britain has fitting national commemorations, including the re-opening of the newly refurbished Imperial War museum next month. Secondly, the Council signed association agreements with Georgia, Moldova and Ukraine. These reflect our commitment to supporting those countries as they undertake difficult reforms that will strengthen their economies, bolster their democracies and improve the stability of the whole continent.

President Poroshenko joined the Council to discuss the immediate situation in Ukraine. The Council welcomed his peace plan and the extension of the ceasefire until this evening. The onus is now on Russia to respond positively by pressing the separatists to respect a genuine ceasefire, release hostages and return occupied border posts to the Ukrainian authorities. The Council agreed that, if we do not see concrete progress very soon, we remain willing to impose further sanctions on Russia. That would not necessarily require a further meeting of the Council, but the Council will return to the issue at its next meeting, which has now been arranged for 16 July.

Turning to the appointment of the next Commission President, I firmly believe that it should be for the European Council—the elected Heads of national Governments—to propose the President of the European Commission. It should not be for the European Parliament to try and dictate that choice to the Council. That is a point of principle on which I was not prepared to budge. In taking that position, I welcomed the support of the Leader of the Opposition as well as that of the Deputy Prime Minister in opposing the imposition of Jean-Claude Juncker on the Council. I believe that the Council could have found a candidate who commanded the support of every member state. That has been the practice on every previous occasion, and I think it was a mistake to abandon that approach this time.

Of course, there is a reason why no veto is available when it comes to the decision—the reason is that the previous Government signed the Nice treaty, which gave up our veto over the nomination of the Commission President, as well as the Lisbon treaty, which gave the Parliament stronger rights to elect the Commission President. Therefore, once it was clear that the Council was determined to proceed, I insisted that it took a formal vote, which does not usually happen. Facing the prospect of being outvoted, some might have swallowed their misgivings and gone with the flow, but I believed it was important to push the principle and our deep misgivings about this issue right to the end. If the European Council was going to let the European Parliament choose the next President of the Commission in that way, I at least wanted to put Britain’s opposition to the decision firmly on the record.

I believe that it was a bad day for Europe because the decision of the Council risks undermining the position of national Governments, and it risks undermining the power of national Parliaments by handing further power to the European Parliament. Although the nomination has been decided and must be accepted, it is important that the Council at least agreed to review and reconsider how to handle the next appointment of a Commission President. That is set out in the Council conclusions.

Turning to the future, we must work with the new Commission President, as we always do, to secure our national interest. I spoke to him last night and he repeated—[Interruption.]

Order. A statement by the Prime Minister must be heard. There is great interest in questioning the Prime Minister, and there will be a full opportunity to do so, but propriety and courtesy dictate that the Prime Minister must be heard.

Thank you, Mr Speaker.

The new Commission President repeated his commitment in his manifesto to address British concerns about the EU. The whole process only underlines my conviction that Europe needs to change. Some progress—some modest progress—was made in arguing for reform at this Council. The Council conclusions make it absolutely clear that the focus of the Commission’s mandate for the next five years must be on building stronger economies and creating jobs, exactly as agreed with the leaders of Sweden, Germany and the Netherlands at the Harpsund summit earlier this month.

The Council underlined the need to address concerns about immigration arising from misuse of, or fraudulent claims on, the right of freedom of movement. We agreed that national Parliaments must have a stronger role, and that the EU should act only where it makes a real difference. We broke new ground, with the Council conclusions stating explicitly that ever closer union must allow for different paths of integration for different countries and, crucially, respect the wishes of those such as Britain that do not want further integration. For the first time, all my fellow 27 Heads of Government have agreed explicitly, in the Council conclusions, that they need to address Britain’s concerns about the European Union. That has not been said before. Therefore, although Europe has taken a big step backwards in respect of the nomination of the Commission President, we did secure some small steps forward for Britain in its relationship with the EU.

Last week’s outcome will make renegotiation of Britain’s relationship with the European Union harder, and it certainly makes the stakes higher. There will always be huge challenges in the long campaign to reform the European Union, but with determination, I believe we can deliver. We cut the EU Budget. We got Britain out of the bail-out schemes. We have achieved a fundamental reform of the disastrous common fisheries policy and made a start on cutting EU red tape. We are making real progress on the single market, and on the free trade deals that are vital for new growth and jobs in Britain.

My colleagues on the European Council know that Britain wants and needs reform, and they know that Britain sticks to its position. In the European elections people cried out for change across the continent. They are intensely frustrated and they deserve a voice. Britain will be the voice of those people. We will always stand up for our principles, we will always defend our national interest and we will fight with all we have to reform the EU over the next few years. At the end of 2017, it will not be me, this Parliament or Brussels that decides Britain’s future in the European Union. It will be the British people. I commend this statement to the House.

I start by joining the Prime Minister in remembering all those who lost their lives in the first world war, and it is right that we will mark their sacrifice and those events throughout this year.

I also welcome the association agreements with Georgia, Moldova and Ukraine, and I endorse the Prime Minister’s sentiments about the situation in Ukraine and the responsibilities of the Russian Government. The truth is that the Prime Minister returned to Britain on Friday having failed—not some small, mild failure, but an appalling failure of relationship building, winning support and delivering for Britain. I know it is inconvenient to remind him, but he lost by 26 votes to two. Now he comes to the Chamber and seems to claim that failure as a complete vindication of his tactics. His party may think it represents splendid isolation, but it is utter humiliation.

The Prime Minister said that with a mandate from all major parties, including Labour, he could build an alliance to stop Mr Juncker. So why did he fail? He started with a divided Europe over the Juncker candidacy, and he ended with a united Europe—against him. He did not say in his statement, so how does he think he pulled off that remarkable achievement?

At the start of the process, the German Chancellor said,

“The agenda”—

of the next European Commission—

“can be handled by him”—

Mr Juncker—

“but also by many others. At the end, there will be a fairly broad tableau of names on the table.”

How did we end up with only one name? How did she and 25 others end up supporting Mr Juncker? Is not the answer that the Prime Minister’s combination of threats, insults and disengagement turned out to be a master class in how to alienate your allies and lose the argument for Britain? That includes his threat to leave the European Union if Mr Juncker was chosen.

We all remember that he went rowing in a boat with Chancellor Merkel and other centre-right leaders on a Swedish lake in order to win support. But afterwards she said:

“Threats are not part and parcel of the”—


“spirit. This is not part of the way in which we usually proceed”.

We know who she was talking about—the Prime Minister.

What happened to the Prime Minister’s great allies in Europe? He wrote in the Daily Telegraph this morning that

“it has been suggested we now lack allies.”

All he needed to do to block Mr Juncker was persuade those people in the boat, but everyone in the boat voted against him. The Swedish Prime Minister voted against him. The Dutch Prime Minister voted against him. The German Chancellor voted against him.

Now, the Prime Minister wants to imply that all of this shows that every other European leader is just deeply unprincipled. Indeed, the Health Secretary went as far as to say it showed everyone else was a “coward”. Is that how the Prime Minister would describe his fellow European leaders? Is not a more plausible explanation that the problem for the anti-Juncker cause was that it had a toxic supporter—the Prime Minister? And is not the reality that he could not attract any allies because the rest of Europe simply lost patience as a result of his actions not just in the last few weeks, but in the last few years? It comes down to this: when he comes calling, they believe he is doing so to help solve the problems of the Conservative party, not those of the European Union.

Let us take the Polish Foreign Minister, who is an Anglophile. This is what he said about the Prime Minister:

“"He is not interested, he does not get it...his whole strategy of feeding”

his Back Benchers

“scraps in order to satisfy them is…turning against him…he ceded the field to those that are now embarrassing him”.


Order. Mr Ellis, calm yourself, man. Only this morning a teacher said to me in Speaker’s house: “How can I tell a little boy in my class to behave when parliamentarians don’t?” Be a good boy; get the message.

Perhaps the Prime Minister will now tell us whether he agrees with the assessment of the Polish Foreign Minister—and who can blame him for thinking in that way, because every time this Prime Minister has had a major decision to make, he has put party interest before national interest. He walked out of the European People’s party nine years ago, and earlier this month threw in his hand with the German equivalent of UKIP. Perhaps he can tell us how that went down with Chancellor Merkel? Was not his decision on the EPP a parable of his failure to lead for Britain—short-term party management at huge long-term loss to Britain’s national interest?

Three years ago, the Prime Minister walked out of a European Council announcing that he had vetoed a treaty, but it went ahead anyway and he just looked absurd. Now, he wants to negotiate a new treaty when he cannot say what he wants in it. All the time, this is driven by a party whose centre of gravity is drifting towards exit. Does he not accept that, with Mr Juncker, the strategy of threatening exit was put to the test and failed? [Interruption.] I know Government Members do not want to hear about his failure, but they are going to hear it.

Does the Prime Minister not agree that the great irony—the thing that makes this even worse—is that he claims to be a great supporter of Britain’s membership of the European Union? We agree that we should be in the European Union. Does he not agree that his problem is the gap between what people behind him are demanding and what sensible European reform amounts to? Europe is not unreformable; it is just that the Prime Minister cannot do it. [Interruption.]

Order. The role of the Prime Minister’s Parliamentary Private Secretary is to fetch and carry notes and to nod and shake his head in the right places. Mr Williamson, be quiet and if you cannot be quiet, get out, man!

The Prime Minister could not get four countries to support him over Mr Juncker, and if he cannot get four countries to block the appointment of a President, how on earth is he going to get 27 countries to support a new treaty? This weekend has shown conclusively to everyone but this Prime Minister that his renegotiation strategy is in tatters. We know where it would end: he would be caught in the gulf between his Back Benchers who want to leave and what he can negotiate. The Prime Minister failed over Mr Juncker. He was outwitted—[Interruption.]

Order. I am quite sure that the Leader of the Opposition will bring his remarks to a close; and the baying mob should calm itself so that he has the opportunity to do so.

The Prime Minister failed over Mr Juncker. He was outwitted, out-manoeuvred and out-voted. Instead of building our alliances in Europe, he is burning them. He is a defeated Prime Minister who cannot deliver for Britain.

We have heard yet another performance worthy of Neil Kinnock—endless words, endless wind, endless rhetoric, but no questions, no grit and no ability to stand up for Britain. I have to say that I will not take lectures on negotiation from the people who gave away the veto, gave away the rebate and who backed down on the budget every year and even signed us up to euro bail-outs. We will not take any lectures from them. The fact is that we did not have a veto in this situation because the Opposition signed the Lisbon treaty and they signed the Nice treaty. That was always opposed by Conservative Members.

The right hon. Gentleman talks about the ability to bring allies together. Where were his allies in the socialist party? They were at a meeting in Paris. All the key socialist leaders were there. They all decided to support Jean-Claude Juncker. Where was the Leader of the Opposition? He was not even invited. That is how much influence he has.

Not once did the right hon. Gentleman actually say that he did not support Jean-Claude Juncker either. To support the Government over opposing this principle and opposing this individual, only to criticise and complain, is typical of the right hon. Gentleman’s approach: weak, opportunistic and wrong.

May I express to our Prime Minister my admiration for his determined opposition to the election to the presidency of the European Union of a man who is wedded to the idea of closer political and economic union, and to the freedom of movement of peoples, which would siphon huge numbers of further immigrants into this country? May I also deplore the provocative decision of the European Union to move its economic frontier to within 300 miles of Moscow, which will certainly be regarded by Russia as a strategic threat to which it will respond?

I completely agree with my right hon. Friend about the importance of recognising that freedom of movement is not an unqualified right. It is very important for it to be properly qualified, particularly in respect of benefit abuse. However, I am afraid that I do not agree with the other point made by the Father of the House. I think that the eastern partnerships that the EU has entered into can help to embed market economics and democracies in those countries. I think it important to stress in respect of, for instance, Ukraine or Moldova that this is not about asking countries which orbit they want to fit into, and whether they want to choose between a good relationship with Russia and a good relationship with the EU. They should be able to have good relationships with both.

I always prefer it when we succeed in, for instance, cutting the EU budget or reinforcing the need for deregulation, but what matters—and the right hon. Gentleman, as a former Europe Minister, should know this—is that there are times when it is important to stand up for a principle and not to give in, no matter what the pressure may be. It does not matter how many countries were ranged against me. I think that Jean-Claude Juncker was the wrong candidate, I think that it was the wrong principle, and there are times when you should stick to your guns.

Does the Prime Minister agree that the conclusions of the European Council were both unprecedented and very helpful? Instead of simply referring to a two-speed Europe, which implies that we all end up at the same destination, the Council stated—for the first time, as far as I am aware—that we must allow

“those that want to deepen integration”

to do so, but we must also respect

“the wish of those who do not want to deepen any further.”

Does that not represent real progress with regard to one of the main objectives of the United Kingdom?

I agree with my right hon. and learned Friend. There is no doubt that seeking changes in the concept of ever closer union is one of the toughest things that we are asking for in our renegotiation. This is the first time that European Council conclusions have ever included anything like this:

“In this context, the European Council noted that the concept of ever closer union allows for different paths of integration for different countries, allowing those that want to deepen integration to move ahead, while respecting the wish of those who do not want to deepen any further.”

The Council also concluded:

“The UK raised some concerns related to the future development of the EU. These concerns will need to be addressed.”

Those words have not previously appeared in European Council conclusions.

I welcome the Prime Minister’s further support for enlargement of the EU, with the announcement that Albania has become the sixth candidate country to join. Does he agree it is important that we work with these countries now on the huge challenges facing them, rather than wait until the last minute, just before they become full members?

I agree with the right hon. Gentleman that the enlargement process has been successful in driving the development and improving the democracy and governance of many of these countries. I further agree with him about engaging with them now, because a country like Albania has huge challenges in terms of tackling corruption, embedding its democracy and developing its economy. In that context it is very important that when new countries get to join—Albania is a long way from that process—there will have to be a totally new approach to transitional controls.

Do not the antecedents of this problem go back to the fateful decision of the Prime Minister when he was running for his party leadership to approve the withdrawal of the British Conservatives from the European People’s party? Mr Juncker was the candidate of the EPP. Had the Prime Minister’s party been a member of it, it could have had influence in private, instead of impotence in public. That would have been good for the Prime Minister, good for his party, good for the Government and, my goodness, far better for Britain.

I have great respect for the right hon. Gentleman and it is good to see him in his place today, but I think he is profoundly wrong about this. Let me give two examples of why I think that. The Liberal Democrats are members of the Alliance of Liberals and Democrats for Europe, yet he was not able to stop the leading candidate process in that group; and the Labour party is a leading member of the Socialist Group, yet it was completely incapable of stopping the leading candidate process in that group. There were members of the EPP who did not approve of this but still could not stop it, so the idea that we would have been able to stop it within the EPP is complete nonsense.

Twenty-six to two is not just the score for the Prime Minister’s—very successful—negotiations to stop the Commission President; it is also the score for the countries that are either in the euro or under treaty obligation to be in the euro. There are only two countries that have got an opt-out, and we are one. If the Prime Minister wants to stand up for Britain’s interests, will he update the House on just what negotiations he has had to ensure that our interests are reflected as the eurozone requires deeper political integration?

The hon. Lady is absolutely right. What we need to secure is a European Union where the eurozone members who need to integrate further can integrate further, but the members of the single market, particularly those like Britain that do not want to join the euro, can stay out of that integration and, indeed, in some cases, powers can be returned to member states. I explained that in these detailed negotiations at the European Council we made some progress on ever closer union and on setting out specific concerns that Britain had, but we have got a long way to go—and, frankly, as I said on Friday, the job has got harder. However, I think there are many in Europe who understand that we need a totally different approach for the eurozone members than for the non-eurozone members.

I commend my right hon. Friend for the stand he took on the overriding Bloomberg speech principle, which was that national Parliaments are the root of our democracy, for which, as we have commemorated recently, people have over the past 100 years fought and died—not only to save this country, but to save Europe as well. Does my right hon. Friend recall that the European Commission, which is now headed by Mr Juncker, recently asserted through Mr Barroso that the European Parliament is the only effective Parliament for the European Union? Does my right hon. Friend therefore agree with me that we must assert our national Parliament—it must prevail—and that he was completely right to do what he did this weekend?

My hon. Friend makes an important point, which is that there are those in Europe—frankly, there are too many of them—who say that the only democratic legitimacy in Europe is the European Parliament, and that somehow the Parliament is the essence of democracy whereas the European Council is an organisation that meets in a darkened room. That is completely wrong. The European Council consists of Prime Ministers and Presidents, who have a much greater democratic mandate than the European Parliament. One of the points that needs to be thought about for the future is that if there is another election like this, we could have a candidate for the Commission presidency who was deeply against the interests of other member states—perhaps a candidate who wanted to kick Greece out of the euro or who did not believe the Baltic states belonged in the European Union. That is why the principle at stake is so important.

Initially, Sweden, the Netherlands, Poland and Italy all expressed reservations about the appointment of Mr Juncker. What does the Prime Minister think he did to change their minds?

The most significant thing that happened is that all these countries, in one way or another, signed up to the Spitzenkandidat—the leading candidate—process. The European political families, starting with the socialists, decided to appoint a candidate they wanted for the Commission; the EPP and the liberals followed suit; and leader after leader found themselves strapped to a conveyor belt of their own making which they could not get off—that is what happened. We did not do that, which is why we rightly opposed this to the end.

But may I encourage the Prime Minister to return to the issue of reform, because long after the indignation is spent, reform will be fundamental to the future of the European Union and our relationship with it? Notwithstanding his disappointment, the Prime Minister has been very pragmatic in the past two or three days, particularly with his telephone call of congratulation to Mr Juncker. Much can be done to reform Europe without treaty change, so is it not time for the rigorous application of the principles of subsidiarity and proportionality, which do not need treaty change, only political will?

I agree with a lot of what my right hon. and learned Friend has said. There are changes that can be made in Europe without treaty change, but my view is that to secure the sort of renegotiation that Britain needs, we should be accompanying some of the treaty changes that the eurozone, in time, will need with treaty changes that will also suit Britain, in the way that the hon. Member for Birmingham, Edgbaston (Ms Stuart) pointed out—as a country that wants to be in the single market but does not want to join the euro.

May I gently suggest to the Prime Minister that, as Mrs Gaitskell once said, it is the wrong people cheering? How exactly have Britain’s national interests and the interests of reform in Europe been advanced by his recent posturing?

It advances Britain’s interests if people know that a British Prime Minister and a British Government will set out a principle and stick to it. The problem all too often under the Labour Government was that they did not stick to their principle. That is why they gave away part of our rebate, they caved in on the budget year after year, and they signed up to eurozone bail-outs. If they had stuck to their principles, they might have been more respected.

Much has been made of so-called divisions inside the Conservative party over this issue, but does the Prime Minister agree that the opposite is true? As a one-nation Tory who believes in our membership of the European Union, I was proud of the way he stood up for British interests last week. Does he agree that the Socialist Group’s candidate for the job— and, by implication, the Labour party’s—a Mr Martin Schulz, makes Mr Juncker look like an arch Eurosceptic?

My right hon. Friend makes an important point. As I say, this process began because one after the other the European political parties decided to pick a leading candidate—a so-called Spitzenkandidat —for the job.

I do not have a candidate for the job, because as a political party leader I think it is wrong to elect the head of the Commission in this way—that is the whole problem. I have to say that the position Labour would have been in if Martin Schulz had ended up as the Commission President would have been even more embarrassing for you.

Does the Prime Minister agree that a British exit from the European Union would be an economic disaster for this country, damaging our trade and employment, and reducing British influence in Europe and the world?

Well, that is not the outcome that I seek; I want to secure a reformed European Union, and I want Britain to be part of that reformed European Union. I have to say that the problem with the hon. Gentleman’s position is that the Opposition do not seem to see anything wrong with the status quo. It is only those on this side of the House and in my party who know that we need serious change in Europe before we hold that referendum.

I congratulate the Prime Minister on—[Interruption.] It is now time for all sensible political leaders to argue for the UK. We are not in the euro and we do not want to join the political union. Only with strong leadership can we have a relationship that makes sense for Britain.

I thank my right hon. Friend for his remarks. I think that the Opposition were rather hoping that we would all be falling out over the European issue, but they can see that we are absolutely united in doing the right thing for Britain.

May I associate myself fully with what the Prime Minister said about the fallen of the first world war? I am proud to say that I will be present in mid-August for the unveiling of the memorial to the Welsh fallen.

If and when the Prime Minister needs the assistance of other states on important issues to come, does he think that his behaviour last week has made his job easier or more difficult?

Let me echo what the right hon. Gentleman said about the first world war memorial. When one stands under the Menin Gate in Ypres, it is very striking to note just how many Welshmen fell in that conflict. I was able to see the name of my great-great uncle who fought bravely for the Canadian Scottish Battalion in 1915 and fell.

As for how Britain approached this issue, I think everyone will be able to see that we were making a serious argument of principle about the wrong decision and the wrong path that Europe is taking by having leading candidates appointed by political parties and then foisted on to the European Union as Commission Presidents. We now know who will be the Commission President for the next five years. Let us think forward: if we continue with this process, we might have as the leading candidate of one of the leading parties someone who has views that are completely antipathetic to one or more member states. That is a very dangerous principle. The democratic legitimacy in Europe should flow through the European Council, which is where the elected Heads of Government and heads of state sit.

Since his principled stand at the weekend, is the Prime Minister aware that there is quite clearly support from our European partners for a large element of reform? Will he now commit himself to the painstaking and difficult work of building the alliances necessary to help us get those reforms so that he can deliver what he promised to the country?

I am grateful to my right hon. Friend for his remarks. That is exactly what I will do. There are countries and leaders in Europe who are clear about the need for reform. They want to see greater flexibility and competitiveness. They are willing to look at the British agenda of completing the single market, signing trade deals, having a flexible European Union, not forcing everyone into the single currency, and imposing safeguards for the single market. Even difficult issues such as ensuring that freedom of movement is a qualified right and addressing benefit tourism are things that leaders on both the right and the left in Europe are willing to change, and that is what we need to build on.

The Prime Minister said in his article this morning and in his statement today that it does not matter if he is isolated as long as he is in the correct position. The difference is that in the negotiation on which he is now embarking, he needs the support not of one other member state but of all other member states. How does he intend to move from a position of not so splendid isolation to securing the support that he says he wants? If he cannot secure it, he will end up recommending withdrawal, which is precisely the outcome he says he does not want.

The right hon. Gentleman makes an important point. Britain will build alliances with the leaders and countries that want to see change in Europe. For instance, the Swedish Prime Minister said yesterday that the UK

“has friends in the EU…Just look into what we have written in our conclusions.”

The Danish Prime Minister said that the EU

“should not occupy itself with some of the things that member states can handle better themselves.”

The Finnish Prime Minister said that

“for a country like Finland, British membership is very important.”

The fact is that when it comes to this renegotiation, there are many countries in the EU that want to keep Britain in and recognise that real change will have to come.

What would have to happen for my right hon. Friend to come back from his renegotiation and recommend that people vote out?

Well, I have set out my approach, which is always to follow the national interest. It is in the national interest to renegotiate our position in Europe to secure the changes that I have set out. I do not start a negotiation believing that we will not achieve those things; I set out wanting to achieve them and to come back to this country, but I will always do what is in the national interest.

We have heard from two very prominent Liberal Democrats, and it is very good that they are present today. On this issue, I was the one attending the European Council, and my colleagues can answer for themselves.

I, too, congratulate my right hon. Friend the Prime Minister on his sterling leadership this weekend, which stands in stark contrast to the behaviour of the sell-out merchants on the Opposition Benches over the past two decades. May I encourage my right hon. Friend to continue to stand up for British interests, which are best served not by ever closer union but by returning real powers to this sovereign Parliament?

I am grateful to my hon. Friend for his support. During what will be, as I have described it, a long and difficult campaign to reform the European Union and our membership of it, it is important to recognise that people need to see clearly that when Britain stands for a principle, it sticks to it.

If the Prime Minister wants to strengthen Britain’s hand in any future renegotiation, it is important that he should be able to say that he represents the national consensus and that he has consulted other parties, business and the CBI, as well as the TUC, to set out clearly what changes he is after. What plans does he have to play this in the national interest rather than from a party political standpoint?

First, on this specific issue there were detailed cross-party discussions to ensure that we all did everything we could to try to stop the conveyor belt of the leading candidates. We should build on that. I set out a very clear agenda in the Bloomberg speech, including deep engagement with business. The British Chambers of Commerce and the Institute of Directors supported what I did at the weekend, and we will go on talking to British businesses to ensure that we deliver what they also think is right, which is reform of the European Union.

Given that my right hon. Friend’s position had the support of the Labour party and the Liberal Democrats as well as of the Conservatives, was he not right to ignore the advice of those who urged him to turn tail as soon as some of our allies turned coat? He was right to stand his ground, and by so doing he has made it more likely that we will win real reform in future. I congratulate him above all on stating the British position with such conviction. As Mrs Thatcher said, the half-hearted always lose; those with conviction ultimately win.

I am grateful to my right hon. Friend for what he has said. This is always important, because in the European Council there is always a temptation simply to go with the flow, to sign up to whatever is being proposed and to try to seek some sort of bauble or extra bit of leverage on the way. Indeed, I suspect that that is what happened in a number of cases. I was very clear that this was an important principle, that I thought Europe was taking a wrong turn, and that I was not going to turn away and do anything but oppose it.

Does the Prime Minister not agree that any real attempts to get radical reform of the European Union will come up against a brick wall made up of people who lead Europe and who, whatever they say publicly, want ever closer union and a federal structure? Is that not the real issue? What the British people want has to be decided by a referendum as soon as possible.

The hon. Lady is absolutely right that a referendum is required, because people have to see that Britain is absolutely serious about requiring reform in the EU. I totally agree with the premise of her question, which is that there have been and to some extent still are people who sit around the table and say endlessly that the euro is the currency of the European Union, forgetting that there are countries such as Britain with a permanent opt-out from the euro. We must get away from that thinking and from the idea of ever closer union and move towards the idea that this is not just about going at different speeds in the same direction, but that for some countries, Britain included, it is about going at different speeds in a slightly different direction. We are not going to join the euro, we are not going to join the Schengen no-borders agreement, and real flexibility needs to be hard-wired into the European Union if Britain is going to stay.

I congratulate the Prime Minister on the stance he took in Europe. He made us all very proud of the British Prime Minister. Is it not a fact that many of the citizens of the European countries now wish to see change in Europe? Does he agree with the Luxemburger Wort, a leading Luxembourg paper, which said, speculating on his stance:

“Could it be that the Brit is already far ahead of the game?”

I have not been as hard working as my right hon. Friend in scouring Luxembourg’s press, but I shall obviously put that right. There are people all over Europe, not just in Britain, who want to see a more flexible approach and European reform. The European elections reflected that, and the leaders of Europe need to listen to those elections.

Does the Prime Minister think that the use of personal insults, either in this House or in the European Council, is more likely to strengthen or weaken the UK’s influence in any renegotiations?

I do not think that it is right to make personal insults or personal attacks, and that is certainly not the approach that I took. I was very clear that this was an issue of principle, but I also said that I thought this individual was the wrong person to take Europe forward. That was on the basis of experience of what he has stood for and explained in the past. But I absolutely agree that personal insults should play no part in this.

The policy of standing up for Britain has gone down incredibly well in Southend, which is hardly a surprise. Has the Prime Minister seen the recent polling that puts the Conservatives up 5%, two points ahead of the weak Leader of the Opposition?

Does the Prime Minister recall that, at one time, we had a Prime Minister called Harold Wilson, who thought that there should be fundamental reform of the then common market? After much huffing and puffing, he announced to an amazed electorate that he had gained those fundamental changes. Harold, being a clever person, never defined what those changes were. In order to give the electorate a real choice this time, will the Prime Minister set up a red and blue lines committee so that voters will know from where he is batting when it comes to the crucial negotiations?

Of course we will set those out very clearly—[Interruption.] I have said that we have got to get Britain out of ever-closer union and end the abuse of free movement and welfare. We have got to have proper safeguards so that we can stay in the single market but not have to join the single currency, proper safeguards so that if we do not want to be in justice and home affairs we should not be in justice and home affairs, and a whole lot more besides. I respect the right hon. Gentleman a great deal, and I would say to him that there is a fundamental difference between the situation he mentioned and what is happening today, because the European Union has changed and developed so much. For those countries that have the euro as their currency, that is driving integration. I believe that, over time, they are going to need not only a banking union but more of a fiscal union and other elements of a transfer union. That will happen to the eurozone, and it is right for the British people to have the opportunity to express their view on a very different position for Britain in that European Union. Those conditions simply did not exist in 1975.

The Leader of the Opposition accuses the Prime Minister of being a failure, but is it not occasionally a virtue, even in this place, to stand up for what one believes in and to fail? It is not necessarily a vice to compromise and succeed, but it is surely neither a vice nor a virtue—it is just rather sad—constantly to compromise and to be a failure, which is the default position of the dead hand of the Leader of the Opposition.

My hon. Friend makes a very good point. The fact is that the leaders of the principal parties in Britain agreed that this person was the wrong one, but as soon as things get difficult the weak give up the chase.

Does the Prime Minister remember the wise advice of Theodore Roosevelt when he spoke of the need to

“speak softly and carry a big stick”?

If he does, how did he manage to end up speaking so loudly and carrying such a small one? The worst of it is that everyone knows that this Prime Minister is not only ropey on strategy but useless on tactics.

As Prime Minister I have secured a cut in the European budget, vetoed a European treaty, secured progress for the single market, and got us out of the euro bail-out schemes that the hon. Gentleman’s party signed up to in government. That is a track record of achievement in Europe, but there are times when you are making a stand on a principle when you are going to be outvoted. There are two reactions to that: you can either give up and go along with the majority, which is, I suspect, what the Leader of the Opposition would have done, or you stick to your principles, make your arguments and stick to your guns.

I thank my right hon. Friend for bringing such refreshing transparency to the negotiating process. Mrs Merkel has said that she is ready to listen and respond to the concerns of the United Kingdom. Does her willingness extend to revision, if not abolition, of the working time directive?

There are a number of things that we need to change in Europe. The working time directive has done great damage, including to our health service, and we never approved of it in the first place. That is very important. We will continue to have discussions with the Germans and others about all the things that we want to change as part of our renegotiation.

Does the Prime Minister agree that, having forced a vote, losing it by 26:2 does not make a good platform for future negotiations?

I do not agree. This was about the future leadership of the Commission, an issue on which political party after political party in Europe had signed up to the leading candidate process. They created, as I put it, a conveyor belt that they could not get off. I do not think that that has such big implications for future negotiations. I said that it has probably made it harder, and I suspect it has, but if we show real fortitude and drive in bringing forward that agenda, there is no reason why we cannot succeed.

I congratulate my right hon. Friend on his principled and consistent stand. Is he aware that in the convention that preceded the treaty of Lisbon, the Government of the day opposed giving the European Parliament a role in choosing the next Commission President, then capitulated, and then told this House during debates on the treaty of Lisbon that this was a good thing and not a change in substance anyway? Does my right hon. Friend agree that we have seen too much backstairs surrender of power to Europe—smuggling of power to Europe—which Labour would no doubt take to the point where we ended up in a united states of Europe?

My hon. Friend is right. There were two key changes. One was in the Nice treaty, which made the appointment of the European Commission President a matter for qualified majority voting, not a unanimous vote. The second change, in the Lisbon treaty, gave the European Parliament greater power. Both changes were taken through by the then Labour Government, and on both occasions, along with a whole lot of other changes, were not put in a referendum to the British people. I think that is one of the reasons why the well of public opinion has been so poisoned in Britain. We have had treaty after treaty, change after change, power after power taken from this House and passed to Brussels, without the British people being given a say. That is why we need the renegotiation and the referendum. Our power in this place comes from the people who elect us. We cannot continually change the rules of the game without asking their permission.

I, for one, am delighted that the Prime Minister is so enjoying going down in flames. I look forward to him doing exactly the same next May. He said earlier that his defence was that he is a man of conviction, but I suspect the only conviction he knows anything about was handed down in the Old Bailey last week. Is not the one thing that we have learned for certain about this Prime Minister that he accepts reassurances far too readily? Will he give this lot a second chance as well?

I think the hon. Gentleman was a bit better when he was in the Oxford university Conservative association—he might then have said something I would agree with: I do not agree with any of that at all.

In his statement my right hon. Friend said that the Council agreed that if we do not see concrete progress in Ukraine very soon, we will remain willing to impose further sanctions on Russia. Does my right hon. Friend, the President of the United States and the other leaders of Europe, and, equally importantly, the President of Russia, agree on the definition of concrete progress?

My hon. and learned Friend is right to raise this. We set out in the Council conclusions a clear set of steps that need to be taken, including transferring border posts that have been taken by so-called rebels back to the Ukrainian Government and the release of hostages. President Poroshenko extended his ceasefire for a further 72 hours, which runs out this evening, and the European Union, working with the Americans—we have been hand in glove all the way—will have to see what changes have been made and whether additional sanctions need to be put in place. At the meeting in July we can look at the so-called tier 3 sanctions and potentially go much further, if further progress has not been made.

May I first join the Prime Minister in marking the need for a memorial? This year, in my own village of Maddiston, the community has built and dedicated a memorial to the fallen that was never there before. Passing on to the meat of the things the Prime Minister mentioned, apart from his own diplomatic triumph, he talked about building stronger economies. When the European Scrutiny Committee went to the Conference of Community and European Affairs Committees of Parliaments of the European Union, COSAC, we heard many countries complaining that the fiscal compact in fact meant rule by Brussels over their economies, resulting in poverty for them. We appear to have poverty for some and selfishness for others, and to boast that we do not give any money to the solidarity fund for those countries shames the UK. What will he do to get those people out of poverty when he talks about building economies?

First, I think that the best way for countries to get out of poverty is by ensuring that they make the structural reforms, including, as we have done in this country, having open markets, having competitive economies and dealing with our debts. That is why we are growing at 3% this year, which is about 2.8% faster than the countries in the eurozone. The point that the hon. Gentleman makes that is a good one is that one of the biggest arguments at the European Council had nothing to do with the United Kingdom at all; it was the members of the fiscal stability and growth pact arguing with each other about whether it should be tighter or looser. I think that only underlines the fact that it was important to keep Britain out of the fiscal compact treaty.

Does the Prime Minister agree that the willingness to stand up for British interests in the face of opposition is a sign of strength of which he can be rightly proud and that we are far better off being led by a man who is willing to go out and bring home the bacon for Britain than by someone who would not even know how to eat it if it was presented in a bap?

That was an ingenious segue from my hon. Friend. I think that it is absolutely clear from what we have seen today that if the Leader of the Opposition was in negotiations like this and the going got tough and it looked like the vote would go against him, he would simply cave in.

I am sure that the Prime Minister will want to take this opportunity to congratulate Stirling in Scotland on hosting an excellent armed forces day over the weekend. The Scottish people observed his ritual humiliation with a mixture of bemusement and horror as the UK edges ever closer toward the EU exit door. Is not the only way now for Scotland to secure its EU membership to vote yes decisively in September to stop him, his party and their UK chums dragging Scotland out of Europe against its will?

First, on a note of unity, I join the hon. Gentleman in congratulating the city of Stirling, the local authority and all those involved on an absolutely brilliant Armed Forces day. With regard to the reactions of people in Stirling to the stand I had taken in the European Union, I must say that I thought they were uniformly positive.

Was my right hon. Friend as surprised as I and others were to learn that the European elections were apparently a pan-European plebiscite on who should be the next President of the European Commission, and that apparently Mr Juncker was a candidate? Does he agree that people who can sincerely believe that rubbish are not only on another continent, but on another planet?

My hon. Friend makes a good point, which is that the leading candidates—the so-called Spitzenkandidaten—did not advertise themselves in Britain at all. In fact, the EPP did stand in Britain and—I checked—got 0.18% of the vote, so the idea that there was this great mandate for Jean-Claude Juncker is false. But we have to accept the fact that other countries got on board this conveyor belt of having a leading candidate and then found it very difficult to get off, even when some of them had real doubts about the principle and, indeed, some doubts about the direction Europe would take as a result. That is why we have said that in the conclusions it is important that we have a review of what happened, and my view is that it should not happen again.

Reform of the EU will require leadership from Britain and a process of alliance building with other EU Heads of State. How far does the Prime Minister think his isolation on this issue has contributed to a positive outcome of that potential process?

I do not accept the premise of the hon. Gentleman’s question. When it comes to completing the single market or signing trade deals, and even when it comes to difficult issues such as getting Britain out of the “ever closer union” clause, or indeed reforming the free movement of people to make sure that it is a more qualified right, there is support for Britain across Europe. The Dutch Prime Minister, in his own debate in his House of Commons before the European summit, talked about the “lies” of ever closer union. The idea that there is not support across Europe for many of the things that Britain is saying is simply not true.

The Prime Minister did exactly the right thing last week, and I congratulate him on standing up for British interests. Will my right hon. Friend make it clear to the rest of the European Council that many millions of British people want a relationship based on trade and co-operation and that if the rest of the European Union does not agree, it will be no surprise if the British people vote to leave the EU?

I am very grateful for my hon. Friend’s remarks. Ultimately, this is going to be a choice for the British people. I know where he stands on the issue and I suspect that in a referendum he will make his views very clear. It is right that it should be the British people’s choice. My job is to make sure we secure the very best renegotiation so that people who want to stay in a reformed European Union, and believe that it is in our national interests to do so, get the best possible choice.

Never mind the party political bellowing from the Conservative Benches—business leaders in my constituency and the rest of the north-west want Britain to be at the forefront of Europe, not in isolation. The Prime Minister concluded his response to my right hon. Friend the Member for Birkenhead (Mr Field) by saying that there was much else besides that he would renegotiate. Will he fill in the gaps and tell us precisely what he means?

First of all, on the issue of what business said, the British Chambers of Commerce said:

“The Prime Minister fought to secure the best possible outcome for Britain, and he was right to do so”.

The Institute of Directors said that

“it is admirable—and refreshing—that a British Prime Minister should stand up for principle and the UK’s interests in Europe”.

People have talked about the CBI. The CBI backed my view that we need reform in Europe and to have a referendum based on a reformed position. I have set out, in the Bloomberg speech, in an article in The Sunday Telegraph and elsewhere, the key changes that need to be made. I recommend that the hon. Lady reads them and sees whether there are any other changes she would seek to make, and then we can have a discussion.

The Prime Minister should be in no doubt that he spoke for Peterborough and our country last week with his robust leadership at the EU Council. I always knew he had lead in his pencil, but it is good to see him sharpening it on the inexorable drive to ever closer union, as personified by Mr Juncker. If he is looking for areas of serious reform, will he make the free movement directive the No. 1 priority? On the Conservative Benches, he has massive support for reforming that in the UK’s best long-term interests.

I am grateful for my hon. Friend’s remarks. It is important to look at the issue of freedom of movement. I particularly mentioned the issue of the benefit changes that are necessary. I also think we need to look at transitional controls, when new member states join the EU. We need a radically different approach from the one that has been held until now. As for my hon. Friend’s remarks about lead in my pencil, I will let the relevant people know.

Some of us who agree with the Prime Minister on the need for reform in Europe, but who are basically pro-Europe, are rather disappointed and depressed by what happened in the European Council, for the following reasons. Many of us think that Europe expanded a bit too far too fast, but we want the reforms and we want them urgently. What has happened in Europe in the last few days has made the task of reform much more difficult. The fact of the matter is that when we look back on this day, when only his barmy army seem so well pleased, we will see that the trouble is brewing for all of us.

I would argue that the hon. Gentleman should not be depressed. As I said, reforming the European Union is going to be a long and hard campaign and undoubtedly there will be difficulties and setbacks along the way. But it is absolutely vital as we go into that reform that people know that when the British Prime Minister and the British Government say there is a principle that is important, they will stick to it.

I do not accept that there is not support for this across the European Union. I have not got to the Luxembourg press yet, but Le Figaro in France says that the approach has been a big mistake, possibly irreversible, and the German press says that there are real worries about the way this development has been handled. I do not think the hon. Gentleman is right to say that the argument that the wrong approach has been taken is simply a British one.

I hope the Prime Minister takes inspiration from the fact that in a previous battle of Britain we saw off many Junckers. As somebody who used to help to run a business that had factories manufacturing in every member state of Europe, I know the value of the single market, but that has now nearly been outweighed by all the costs, regulation and constitutional attacks that come with it. Therefore, what the Prime Minister has just done in Europe has given us the best chance, through him, to negotiate the reform necessary to sustain the option to stay in.

I know that my right hon. Friend has great experience of the business world. It is important that following my Bloomberg speech, the reaction of the business community was not to say, “This is a risk Britain shouldn’t be taking”, but to say, “We need reform and as long as we can secure good reforms then Britain should stay in that reformed European Union.” It is important that business, large and small, is behind the approach that I am taking.

A year or so ago, one of the Prime Minister’s Back Benchers was quoted as saying that he—the Prime Minister—was in danger of coming over a bit Melchett. [Interruption.] Melchett was a character in “Blackadder”. Judging by the Prime Minister’s performance over the weekend, I think that many of us have some time for that comment. When he said that if Mr Juncker was appointed there would be “consequences”, what was he getting at?

First of all, there are consequences from Europe adopting the principle that the head of the Commission should effectively be appointed following nominations by European political parties. If that is allowed to continue, and if it happens again, there will be real consequences, because we could end up with candidates who, as I said, have particular views that are totally against the interests of individual member states. That is a very worrying development. In the Council conclusions, we have agreed to review this process, and I hope we can make sure that it does not happen again.

If exit from the European Union is not what the Prime Minister seeks, can he resist the siren voices who are calling for ever more unachievable demands, backed by the threat of exit, to ensure that that does not happen? After the excitement of this week, will he reflect on how he can build alliances for reform that will promote jobs, cut red tape and reduce waste, which is actually what the citizens of the entire European Union are looking for?

I thank my right hon. Friend for that question. The work of the British Government—a coalition Government—in the EU is to complete the single market in digital, energy and services and to sign the trade deals with the fastest growing parts of the world. That agenda is progressing well, and it is important that we stick to it. I am not setting out impossible demands; I am setting out things that could be changed, and should be changed, in order to reform Britain’s place in the EU.

An estimated 3.3 million of our constituents are in jobs that could be at risk if the UK exits the EU. Business leaders have reacted with fury after Friday’s fiasco and its aftermath. John Cridland, the head of the CBI, has said that Britain’s economic future depends on being in Europe. Does the Prime Minister agree with him, and can he guarantee that he will never vote for Britain to leave the EU?

I do not agree with the hon. Lady. The CBI’s director general said:

“We will…press the case for the UK remaining in a reformed European Union.”

That is my policy. As I said, the Institute of Directors, the British Chambers of Commerce and David Frost, the former Europe director in the Foreign Office, all made the point that this was the right stand to take, and it is important to stand up for a principle and to fight for it.

Order. I am keen to accommodate more colleagues on this extremely important matter, but in order to do so I require exemplary brevity. I know that the tutorial will be provided by Dr Julian Lewis.

Trying, as always, to see the bright side of life—I am not going to sing it—is there not something to be said for having an obvious and overt federalist as Commission president rather than a covert and rather cleverer alternative?

My hon. Friend is ingenious in seeing a silver lining in every cloud. I had not got him down as one of nature’s out-and-out optimists, but I will have to reassess that judgment. We will now have to deal openly and frankly with the new Commission president if he is endorsed by the European Parliament. He did say in his manifesto—although he was not standing specifically in Britain, as it were—that we have to address the issues of reform that Britain has put on the table, and we now need to make sure that we hold him to that.

The automotive industry in Britain is a world-class success story. Key to that success is inward investment. Key to inward investment is continuing membership of the European Union. Does the Prime Minister not recognise the damage that he is doing to the jewel in the crown of British manufacturing and the British national interest through the ever-greater uncertainty he is creating over membership of the European Union as he takes us towards the exit?

I do not accept what the hon. Gentleman says. Over the past four years, we have seen an absolute transformation in the fortunes of the British automotive industry. We see that in Jaguar Land Rover and in Nissan. These companies are choosing to invest and they are doing so after I made the Bloomberg speech, because they can see there is a British Prime Minister and a British Government who are fighting for a better deal in Europe.

When the Prime Minister gets Britain’s new deal in Europe, with

“big and significant improvements on the previous terms”


“after long and tough negotiations”,

so that he can say,

“I believe that our renegotiation objectives have been substantially, though not completely, achieved”—[Official Report, 18 March 1975; Vol. 888, c. 1465.]

will he reflect on the fact that that is what Harold Wilson said?

I know and respect that, whatever deal I manage to achieve, my hon. Friend will vote for Britain to leave the European Union, because that is his long-held and deeply felt view. As I explained in answer to an earlier question, the conditions today are very different from those in 1975. Then, of course, Britain had just joined the EU—there was no great change that had taken place in the EU—but this time, since I have been a Member of Parliament, we have had the treaties of Nice, Amsterdam and Lisbon, and huge changes in terms of the eurozone and its development. I was told when I became Prime Minister, “It’s very unlikely, Prime Minister, that you’ll have to deal with any treaty changes at all,” but I think we have already seen three in the past four years. I am confident that, because change is needed throughout the EU, Britain can secure the changes we need.

Saturday’s Financial Times editorial said:

“Europe’s leaders should look beyond Mr Cameron’s ineptitude”.

Does the Prime Minister agree?

Funnily enough, I do not agree with that. I think that what Europe’s leaders will do is conclude that when they are dealing with Britain, they are dealing with a country that sticks to its principles.

Thanks to the actions of the Prime Minister last week, Jean-Claude Juncker is now a marked man. Few had previously heard of him, but now a whole continent knows of him and what he stands for. Does my right hon. Friend agree that what we need to do now is ensure that the actions of the EU President be judged through the lens of what they contribute to EU reform and that this seeming setback may well mask a greater opportunity for much-needed change in the long term?

My hon. Friend makes an important point. One of the things that will be key to the EU’s success in the coming years is whether it can deal with a Europe that requires change for the eurozone and change for Britain. From my discussions with Jean- Claude Juncker, I think he understands that that is a very important agenda on which we have to make progress, otherwise the British people will take a different view.

Does the Prime Minister not experience the slightest cognitive dissonance in arguing on the one hand that the voters of Europe feel that the European project has gone far enough, while arguing on the other that the borders of Europe should be extended all the way to Donetsk in the Leninsky district of Ukraine?

I am not making that argument. The argument I am making is that it is right for the European Union to have association agreements and other forms of agreements with countries in central and eastern Europe, in order to help encourage their economic development, politics, fights against corruption and rule of law. Just as I think the membership application process has been so beneficial for countries in eastern Europe that have joined the European Union, so I believe these association agreements can help as well.

May I commend my right hon. Friend on saying what he is going to do and then doing it? I know it surprises Opposition Members, but it is called leadership. In his conversation with Mr Juncker, did he manage to remind him that the British people are not isolated in wanting reform and that at least a third of the people of Europe voted for reform of the whole of Europe?

My hon. Friend makes an important point. It must be right for the reaction of Europe’s leaders not to ignore the third of the continent that voted for parties that are hostile to, or want very radical reform of, the EU. We have to accept the fact that our citizens want change in Europe, and we should be trying to make changes that reconnect people with the purpose of this organisation, which has been about securing peace on our continent and which should now be about securing greater prosperity and more jobs.

The PM has had a lot to tell us today about losing, so will he admit to the House how many jobs will be lost if Britain were to leave the EU?

My intention is that Britain reforms the European Union and then agrees to stay in a reformed European Union. That is the right outcome. There are all sorts of economic analyses, which people can read, about the consequences for Britain either of remaining in an EU that is overly bureaucratic or, indeed, of choosing to leave.

Once again, my right hon. Friend is the toast of Somerset for his stand against Mr Juncker. Now he has done this bold thing, is it not the ineluctable logic of his position that he should oppose any further moves to the integration of justice and home affairs, which covered the first 13 paragraphs of the Council’s conclusions, and most particularly that we should not opt in to the European arrest warrant, which would give Mr Juncker, the Commission and the European Court of Justice additional powers?

I am very grateful to my hon. Friend once again. People seem to do a lot of toasting in Somerset, which I am sure is very good for the health in all sorts of ways.

On the issue of the justice and home affairs opt-out, what we have done is to achieve the biggest return of power from Brussels to Britain that there has been since we have been members of this organisation, by exercising that opt-out. We did that on the basis that it was important to opt back into a small number of measures that will actually help us to catch criminals and terrorists, and to keep our people safe.

When did the Prime Minister realise that he had failed to convince almost everyone, and with that realisation, what adjustments did he make to the substance and style of his engagement with other EU leaders?

As I have said, the critical moment was when other leaders who had signed up in some way to this leading candidate process realised that they could not actually change their approach, which I think was the case in many European countries. They were on a conveyor belt they could not get off, so it became apparent that Britain was not going to succeed in our campaign to stop this principle and stop this person. At that point, it is important to stand up for a principle, and to take the arguments all the way to the end. If you get a reputation that every time the going gets tough, you simply give in, you get into the position in Europe that Labour Governments put us in time and again.

I hugely respect the way in which the Prime Minister has listened to public opinion following the European elections, unlike Opposition Members and the European Union, but if the European Union continues to ignore public opinion in the way it has over the weekend, is there a mechanism by which we can either continue to cut the EU budget or withhold our budget contributions completely?

I am a believer in this: when we sign up to something, we should stick to it and deliver what we said we would do. With the European budget, we achieved a cut over the seven-year financial framework which will effectively mean lower European budgets. Our battle now is to make sure that the EU sticks to that, and does not find new and innovative ways of spending money.

The debate about our future role in Europe would be better informed if we knew what the red-line issues were that would force the Prime Minister to recommend a no vote in his referendum. Will he say when he will let the public know what those red line issues are, so that they can have a more informed debate about Europe?

Perhaps I could send the hon. Gentleman a copy of my article in The Sunday Telegraph and of the Bloomberg speech, which set out the key areas, including ever-closer union, that are so important.

A point that is very rarely made—with the democratic deficit we have, following the recent European elections—is that there has been a huge and significant rise in extremist parties. May I impress on my right hon. Friend, for when he next meets his European counterparts, that if we fail to reform the status quo we are creating an environment that is very difficult for minorities across Europe, but if we reform, it will create an environment in which we can extinguish a lot of such extremist feeling?

My hon. Friend makes a very important point. We need to make sure that all of Europe’s leaders address what has gone wrong in the European Union and the view people take of it, because it is not healthy for extremist parties to be given a sort of recruiting sergeant, as it were, by failures in the organisation.

I am sure that the readers of The Daily Telegraph are reassured by the Prime Minister deciding that he can now work with Mr Juncker. The real question, however, is whether Mr Juncker can work with him, particularly after the insults, including those to the so-called “cowards” by those who are supposed to be the Prime Minister’s supporters. The reform agenda is really important, but has he not proved himself a lame duck when it comes to promoting it?

I have sat with Jean-Claude Juncker around the European Council table for the past four years. I spoke to him last night and, as he put in his manifesto, he wants to address the concerns that Britain has about the European Union. My job as Prime Minister is to hold him to that and make sure that we reform the organisation.

I spent Armed Forces day at a very moving service in Hereford cathedral organised by the Royal British Legion. In that spirit, I congratulate the Prime Minister on standing up both for constitutional principle and for the voice of Britain, of reform and of the nation state, and on doing so with one hand tied behind his back by the Labour party—[Interruption]—because of the Nice and Lisbon treaties. [Interruption.] Does he share my view that the real issues are the deep lack of democratic legitimacy embedded in many EU institutions, the need to address popular discontent, as shown in the recent election, and the need for reform that is backed particularly by European allies who see the need for treaty change to secure the eurozone?

My hon. Friend makes an important point. We need to battle the view that in Europe the only democratic legitimacy comes through the European Parliament. Our view is of Europe as a collection of nation states working and co-operating together; therefore, a lot of the democratic legitimacy should come through the European Council, made up of the Presidents and Prime Ministers of Europe, who all have a democratic mandate from their own peoples.

The Prime Minister has emphasised the importance of national Parliaments. What opportunity will this Parliament have to scrutinise his proposed choice of the next UK Commissioner to Europe?

The hon. Lady asks an important question. As has happened on some other occasions, asking a potential candidate to see Members on certain Select Committees is something I am absolutely prepared to consider.

The constituents I listened to over the weekend told me that they were pleased that the Prime Minister had done what he said he would, in the national interest, rather than just going with the flow to the UK’s detriment, for fear of being isolated.

I am grateful to my hon. Friend. As I have said, it is important—not least for the future negotiations that this country will need to take part in—to make sure that people know that when we make a stand, we stick to it.

Only an ex-PR man would seek to paint a vote lost 26-2 as a victory. It does not bode well for future renegotiations. What does the Prime Minister put it down to: his withdrawal from the EPP, his failure to build alliances or his hectoring of leaders of other states from the Baltic nations through to Poland and Ireland?

As I said earlier, the idea that somehow this all came about because the Conservative party no longer sits in the EPP is complete nonsense. The Liberals sit in the ALDE group—the Alliance of Liberals and Democrats in Europe—and the Labour party sits in the Socialist group. All the groups decided to adopt a leading candidate. Many of the Prime Ministers and Presidents subsequently rather regretted that the treadmill was taking them in a direction that they did not necessarily want to go in.

Right across Europe we have seen an increase in the Eurosceptic vote and a demand for reform. Does the Prime Minister therefore agree with me that the European Union needs to respect that support for the nation state and ensure that whenever we select a President the viewpoint from across the European Union is taken into consideration?

My hon. Friend is absolutely right. The Dutch Prime Minister has a mantra, “Nation states where possible; Europe only where necessary.” That is the approach that we should take. There are some in Europe who think that whenever there is a problem of legitimacy, the answer is more Europe. My argument is that in many cases the answer should be less Europe, more for nation states, more for national Parliaments, more subsidiarity.

Today we have learned that the Prime Minister’s approach to Europe now has the full backing of the right hon. Member for Wokingham (Mr Redwood) and the hon. Member for Stone (Sir William Cash). [Interruption.] Yes, and many other Members. If the Prime Minister is as successful in the forthcoming renegotiations as he has been in these negotiations, will he recommend that Britain leave the EU—yes or no?

My position is that I want Britain to secure renegotiation and reform, and then vote to stay in a reformed European Union. I think that the hon. Lady must have written her question before she heard the remarks of my hon. Friends. What we have learned today is that if we had a Labour Prime Minister, as soon as they got in the room and felt a bit of pressure, they would give up.

This weekend, Tom Pursglove, the excellent Conservative candidate for Corby, and I were campaigning in east Northamptonshire. Everyone we spoke to, whether they were a Conservative supporter, a Labour supporter or a Liberal Democrat supporter—no, sorry, we could not find any Liberal Democrat supporters—all thought that the Prime Minister had done the right thing. Given what has been discussed today, will the Prime Minister confirm that he will not rule out the possibility of leading the out campaign in 2017?

I am very grateful to my hon. Friend for the campaigning that he has been doing in Corby and Northamptonshire. I have made it very clear what I want to achieve. This is about Britain’s national interest. I will always do what is in our national interest. The best outcome for Britain will be to secure the renegotiation and the changes, and vote to stay in a reformed European Union.

Given that more than half the exports from my region, Wales, go to the European Union, will the Prime Minister help me to understand how his Billy-no-mates 26-2 defeat helps businesses such as Airbus, Toyota, Tata Steel and Vauxhall in my region?

The right hon. Gentleman should ask the businesses in his region and he will find that they say that it is right for Britain to reform the European Union and vote to stay in a reformed European Union. That is the position of the Institute of Directors, the British Chambers of Commerce, the CBI and many others.

It is true that Jean-Claude Juncker was not everybody’s favourite candidate. However, having remembered the spark that ignited a war that killed more than 10 million Europeans, was this not the week to celebrate peace, democracy and friendship among the free nations of Europe, rather than to exaggerate difference and disagreement?

It was the week, rightly, to commemorate the fallen in Ypres. We had a sombre event and a very good discussion about the peace that Europe—and, I would argue, NATO—has helped to bring to our continent. We should never again go back to the ways of the past. At the same time, it was perfectly legitimate the next day in Brussels for those of us who had a very clear objection in principle to make that objection known.

The events of the past week have exposed not only a lack of judgment on the part of the Prime Minister, but his inability to negotiate with other countries on our behalf. Does this fiasco not demonstrate the need for his departure from No. 10 and not the UK’s exit from the European Union?

The hon. Lady was struggling to keep a straight face during that question, but I applaud her effort. As I have said, what this demonstrates is that if we had someone doing this job who set out a principle and an argument, but who caved in at the first sign of fire, we would be in a very weak position.

The Fresh Start group of Conservative MPs has been making the case for European reform across Europe. On every visit, the Prime Minister’s leadership on the reform agenda has been spoken about and debated. No one else is leading the fray in the way that he is. Will he continue to make the case not just to the UK, but to the rest of the EU, that reform is the only way to go?

I am grateful for my hon. Friend’s remarks. In other European countries, many people want the approach that we are taking—greater flexibility, greater competition and powers flowing back to nation states, not just towards Brussels—and support our views.

Does the Prime Minister agree with the hon. Member for Cardiff North (Jonathan Evans), who has great experience of Europe, who said on Radio Wales yesterday that had the Government still been in the EPP, they could effectively have exercised a veto on the decision to elevate Mr Juncker? Is it not true that the worthwhile reforms in Europe will come from the moderate parties and not from the headbangers with whom the Prime Minister is associated at the moment?

The question I would ask back to the hon. Gentleman is, if it is so easy to veto the Spitzenkandidat process, why did Labour not do it in the Party of European Socialists? The idea that we would have been able to do so if we had been in the EPP is nonsense. There were other Prime Ministers in the EPP who did not stop the process. I am proud that we have our own political grouping in Europe and that it was the one group that decided not to take part in the process.

Will the Prime Minister pledge never to adopt the negotiating position of the Leader of the Opposition, which is to go along with absolutely anything the EU asks him so as not to appear isolated in the EU—and before he listens to any advice from the Lib Dems, may I suggest that he has a quick glimpse at the opinion polls? During the summit, did the Prime Minister get any intelligence from his socialist counterparts as to whether the Leader of the Opposition will once again surreptitiously block the private Member’s Bill of my hon. Friend the Member for Bromley and Chislehurst (Robert Neill), which will guarantee the people of this country an in/out referendum on the EU?

My hon. Friend asks an intriguing question and I do not know whether Labour will block the opportunity to put into statute now the need for a referendum before the end of 2017. Everyone in this House will have a chance to vote on that Bill, and I hope we will support it.

Having so skilfully turned a divided EU into an EU united against his position, will the Prime Minister spell out at the Dispatch Box precisely where he expects to win in his renegotiation?

As I have explained, I will send the hon. Gentleman a copy of the Bloomberg speech and The Daily Telegraph article, so he can immerse himself in the detail. We need to make changes to ever closer union, benefit tourism, and the free movement directive, and we need to make changes to embed the single market and save those countries that do not want to be part of the eurozone. This all begs a question—the Government have a clear plan and set of demands that we want to make, but what have we got from the Labour party? It is opposed to a referendum and it caves in on every important European issue; it gave away the rebate and never stood up for Britain on the budget; and it signed up to eurozone bail-outs and it was weak, weak, weak.

Socialist France is rapidly emerging as the principal barrier to the renegotiation objectives of my right hon. Friend, and he is unlikely to get much useful help from its allies on the Opposition Benches. Happily, just in time in 2017 there will be a French general election that should see the Union pour un Mouvement Populaire return to office. Will my right hon. Friend ensure that he and all his colleagues do their best to improve our relations with the UMP?

We must work with all elected Prime Ministers and Presidents in Europe, and I work very closely with Francois Hollande. There is an understanding in France that it has always believed in “L’Europe des patries”—the Europe of nation states—and we must make sure that that is followed through.

We know who the Prime Minister was against, but why can he not tell us who he would have favoured to be President of the European Commission? Is it because this had nothing to do with principled statesmanship, and everything to do with cynical behaviour?

I was very clear: I thought there were a good number of people sitting round the European Council table who would have made good Commission Presidents, and I can think of people from the left, the right and the centre of politics. This is the important point: if we keep with this leading candidate process named by political parties, again, we will never have a serving Prime Minister or President sitting as President of the European Commission, and I think that is a huge mistake.

The Prime Minister will have been as disappointed as I was that Sweden did not support him in the vote against Jean-Claude Juncker. Given the recent negative comments by Fredrik Reinfeldt about ever closer union, does the Prime Minister agree that Sweden and other northern European countries with secure and flourishing economies will be a rich seam of support in the reforms he is seeking?

My hon. Friend makes an important point. Prime Minister Reinfeldt said:

“Just look into what we have written in our conclusions…You will find references…saying this ever-closer union perception is maybe not the best for everyone.”

That is clear support for Britain’s position.

We know that Germany exercises considerable influence in the European Union, and until last week’s vote, the mood music seemed to suggest that Britain and the United Kingdom were on the same page. Will the Prime Minister tell the House exactly why Chancellor Merkel refused to support him?

Obviously, it is for Chancellor Merkel to set out her views, but I would explain it like this: among other leaders, she was one of those who had signed up to the concept of the leading candidates and the EPP picking a particular candidate—just as the socialists had picked a particular candidate—and the domestic reaction when she suggested that other candidates could come forward was extremely strong. As a result, as I have put it, I think a number of people got themselves on to a conveyor belt by supporting this process, and they found it very difficult to get off.

I thank the Prime Minister for the stance he has taken. The poll published this afternoon shows that although the Labour party is not with him, the British people are. Does he agree that it is not just in Britain’s interests that he sticks to his guns, but in the EU’s interests?

I am grateful to my hon. Friend, who is right to say that lots of people around Europe want to see reform and to see Britain as the leading voice of reform. Clearly, we will not get that reform unless we set out principles and stick to them.

Can the Prime Minister envisage a situation in which he believes it is not in the national interest for Britain to continue its membership of the EU? In those circumstances, will he campaign for an “out” vote?

Those are not the circumstances I seek. I will always be guided by what I see as the national interest, and I have set out several times in the House today what defines the national interest: reform in Europe, a referendum in Europe, and Britain in a reformed Europe.

Order. I want just a small number of very pithy questions. I look in hope if not in expectation to Sir Tony Baldry.

Will my right hon. Friend similarly confirm that we did not pick a fight in Europe, and that it was not us who introduced the system of leading candidates, which undermines the constitution? But for that, there would have been no row.

My right hon. Friend is entirely right. The socialist grouping first, followed by the EPP and others, decided to take that approach, which I do not believe is in line with the European treaties.

Businesses in my constituency—multinationals such as Kellogg’s; European companies such as ESBI, SAICA and Lucchini; and British-owned companies that seek to export to Europe, such as Northern Drives & Controls—all say that it is crucial to their business to stay in the European Union. How does the Prime Minister expect to have the authority to negotiate a better deal for Europe to enable them to do so?

I have listened a lot to the voices of British businesses large and small. They, too, want European reform. They are frustrated by the bureaucracy and the red tape, and by the failure to complete the single market. They do not want Britain to be part of a European superstate; they want co-operation and trade between nations. That is what we want. Although the task has undoubtedly become more difficult, I see no reason why we cannot achieve it if we stick to our guns.

Last week, I attended Brighton’s wonderful golden handbag awards. May I take this opportunity to nominate the Prime Minister for a different handbag award for sticking up for Britain in the way he has?

I am grateful to my hon. Friend. A new element of life in Brighton has been visited on me. I am sure it was a great event and I am grateful for his support.

But, on reflection, does the Prime Minister accept that his aggressive and personalised opposition to Jean-Claude Junker was in fact counter-productive to British interests, and that it would always be that way? In the event that Mr Juncker won, which he did, he would be unsympathetic to British interests. In the event of Mr Juncker losing, the Prime Minister’s aggression would mean that supporters of Juncker would be lined up against Britain, and his friends would demand favours and compromises, undermining our position. Is it not always best to support one candidate rather than demonise another? The Prime Minister has not gone with the flow; he has gone with the wind.

I do not accept what the hon. Gentleman says, and I do not accept that the arguments we made included any insult—they did not. There was an argument about principle and an argument about the direction that the EU was going. On our influence, the German press this morning reports: “Cameron showed consistency in his fundamental conviction. We know where we are. He wants tough EU reforms, further liberalisation, a reduction in bureaucracy, and growth and jobs.” The German press can see what we stand for.

I thank the Prime Minister for ditching the useless policy of negotiation and capitulation that got us on to the motorway without exits towards a united states of Europe. Does he believe that the leaders of Europe get it? If there is no reform, the British people will head for their JCBs, create their own exit and vote to go down it in 2017.

I am grateful for what my hon. Friend says. There is real understanding that Britain wants and needs reform of the EU. That is why it is encouraging that that is written for the first time in the conclusions of last week’s Council meeting.

Does the Prime Minister believe that his MEPs strengthened or weakened his negotiating position with Chancellor Merkel when they defied him and joined her Eurosceptic opponents in the European Parliament?

Order. I am sorry to disappoint colleagues, but I have called 86 Back Benchers. The Prime Minister has given very fully of his time and I am grateful to him and to colleagues. I must have some regard to the fact that it is an Opposition day, and people who have been in the House for some time will know that far more people get in on statements than ever before.