By James Chapman and Alex Brummer
David Cameron was branded an EU ‘enthusiast’ by Tory Eurosceptics last night as he said Britain must let eurozone countries move towards a United States of Europe with a common economic policy.
The Prime Minister admitted he was not sure whether Germany and other countries had the political will to prevent a break-up of the single currency, but insisted they must be allowed to try – even if that meant closer integration.
The tumult on global financial markets intensified yesterday ahead of a crunch ruling by the German constitutional court on the legality of bailouts for debt-crippled nations.
Mr Cameron, appearing before MPs, repeated his pledge that Britain would never join the euro while he is in charge.
But he and the Chancellor have reversed decades of opposition to a two-speed Europe, in which Britain and others would stand apart from a closer-knit inner core of nations.
George Osborne yesterday urged governments in the single currency nations to follow the ‘remorseless logic’ of further financial fusion.
But he suggested there was ‘no immediate prospect of major treaty renegotiation’ that would allow Britain to try to claw back some powers already transferred to Brussels.
‘The Chancellor and I have both said that the logic of monetary union is a greater fiscal union and we see the eurozone countries moving in that direction,’ Mr Cameron said. ‘I don’t think we should stand in the way of them making some progress.’
Bill Cash, the Eurosceptic Tory MP who chairs the Commons European scrutiny committee, told the Prime Minister that while he had ‘certain reservations’ about the EU, it was clear that he was ‘actually rather an enthusiast’ for keeping the union together through integration.
Mr Cameron insisted he was a ‘practical Eurosceptic’ – but warned of economic disaster for Britain if the euro is allowed to collapse.
He also rejected calls for either an ‘in-out’ referendum on membership of the EU, or one on integration.
‘To say you have to have a referendum in Britain about something other countries are doing, and going ahead with anyway, I think would be rather an odd approach,’ he said.
Today, Germany’s constitutional court is due to decide whether the country’s participation in the rescue of Greece, Ireland and Portugal with huge EU bailouts breached its laws.
Economists and politicians bringing the legal case argue the government was required to vote in its parliament beforehand.