David Cameron: we’ll back euro change

Britain is prepared to endorse a fresh round of EU treaty changes to allow the rules governing the euro to be updated in the light of the Greek sovereign debt crisis, David Cameron announced toay.

The prime minister, who said during the general election that the EU should not embark on further changes, told MPs he would be prepared to back adjustments as long as they had no impact on Britain.

Germany wants changes to the rules governing the euro, which is undergoing its gravest crisis amid signs that Greece is likely to default on its debt. Under the plans, sanctions will be imposed on countries that breach deficit and debt ceilings.

Cameron said he was prepared to support treaty changes after securing the agreement of fellow EU leaders at last week’s summit in Brussels that they would not apply to Britain, which has a permanent opt-out from the euro.

Cameron said: “Sorting out the eurozone and adding to its governance arrangements is clearly vital for Europe. There may well be significant changes coming down the track.”

He added: “We will back measures that help sort out the eurozone. We will not back measures that pass power from the UK to Brussels. And, as we are not a member of the euro, we will not back measures that draw Britain further into financial support for the euro area.”

Eurosceptics may object to Cameron’s offer but the prime minister says he is simply responding to circumstances and that the new rules will not apply to Britain.

Treaties can only be changed with the agreement of all 27 EU member states.

Cameron made clear that Britain would adopt a cautious approach to another proposal in response to the financial crisis – allowing the European commission to monitor the budgets of individual countries.

He said that he would agree to “co-ordination and consultation” with the commission on budgets. But he adopted the language of Margaret Thatcher when he said that would not go any further. “Clearance – no, never,” he said.