Cameron triggers biggest split in EU history

Prime Minister David Cameron has triggered what has been described as the biggest split in the 50-plus year history of the European Union.

It came after Cameron used Britain's veto to block a proposed euro zone treaty change when Germany and France refused to agree “safeguards” to protect the UK economy – and the City of London in particular – during crisis talks in Brussels.

This stopped a planned treaty change among all 27 EU members to help the euro zone nations take steps needed to stop the debt crisis.

Sweden, Hungary and the Czech Republic, also refused to support the 27-nation deal, leaving them and Britain effectively isolated.

Instead a new bloc has been formed among the 17 euro zone nations that brings them under tighter fiscal control, along with six other EU members who are not part of the euro zone.

This has effectively created a two-tier Europe with the UK and its three allies very much outside the main group.

The 23 members of the newly-dubbed “Euro Plus” bloc will now meet every month in a move which effectively confirms the UK's outsider status.

This morning Cameron said: “I came here with one of two outcomes in mind: safeguards that made a treaty within a treaty, a complex legal structure, or if we could not have that, allowing others to go off in a treaty on their own and ensuring that the EU is maintained as a single market.

“I had to pursue very doggedly what was in British national interest. It is not easy when you are in a room where people are pressing you to sign up to things because they say it is in all our interests.”

He added: “It is sometimes the right thing to say, 'I cannot do that, it is not in our national interest, I don't want to put that in front of my parliament because I don't think I can recommend it with a clear conscience, so I am going to say no and exercise my veto'.”

French President Nicolas Sarkozy called Britain's demands “unacceptable”.

He said: “We would have preferred a deal at the level of the 27. That wasn't possible taking into account the position of our British friends. In order to accept treaty revision among the 27 EU states, David Cameron asked us – something we all judged unacceptable – for a protocol to be inserted into the treaty granting the United Kingdom a certain number of exonerations on financial services regulations.

“We could not accept this, since we consider, quite on the contrary, that a part of the world's woes stem from the deregulation of the financial sector.”

Sarkozy added that the developments in Brussels overnight meant that the summit “will go down in history.”