Cameron claims breakthrough in talks over EU reform demands

David Cameron has claimed a breakthrough in his most controversial EU reform demand, after European Council president Donald Tusk agreed that Britain should be able to limit welfare payments to EU migrants immediately after a referendum.

But other important issues remain unresolved, notably on the rules governing the relationship between the euro-zone and non-euro zone countries like Britain.

Leaving Downing Street less than two hours after he arrived for dinner with the prime minister on Sunday night, Mr Tusk said there was “no deal”.

But Mr Cameron said the two men had “a good meeting”, adding that Mr Tusk had agreed to “another 24 hours of talks” before publishing a draft renegotiating text.

A Downing Street spokesman said there had been considerable progress since Mr Cameron met European Commission president Jean-Claude Juncker last Friday.

“On welfare, the Commission have tabled a text making clear that the UK’s current circumstances meet the criteria for triggering the emergency brake. This is a significant breakthrough, meaning the prime minister can deliver on his commitment to restrict in work benefits to EU migrants for four years,” he said.

The “emergency brake” proposal on emerged in Brussels as an alternative to Mr Cameron’s demand for all EU migrants to be required to pay tax in Britain for four years before they could claim benefits.

Under the proposal, any EU member-state could call for an emergency brake on welfare payments to workers from other EU countries if they could show that their public services were struggling to cope because of migration.

The decision on whether to approve the emergency brake would rest with EU leaders and Mr Cameron wanted an assurance that it could come into force in Britain the day after the forthcoming referendum on Britain’s EU membership. The prime minister hopes to secure a deal this month, opening the way to a referendum as early as June 23rd.

The Downing Street spokesman said that Mr Tusk would now publish his draft negotiating text on Tuesday and negotiators would work for another 24 hours in an effort to resolve remaining outstanding issues.

“One such area is economic governance where we want to ensure the enforcement mechanism is watertight, recognising that there must be ways to escalate an issue where we have concerns. Another is abuse of free movement, where we want to see more substantive proposals including closing backdoor routes to Britain which have enabled non-EU illegal migrants to stay in Britain in recent years,” he said.

The biggest outstanding issue now appears to be Britain's demand for safeguards to ensure that euro-zone countries will not be able to gang up on Britain to force through measures that could damage the interests of the City of London. France is reported to be resisting some of the detail of Britain's demands in this area.

Eurosceptics have dismissed the prime minister's demands as inadequate, and Steve Baker, co-chair of the anti-EU Conservatives for Britain group, on Sunday dismissed the renegotiation as a farce.

“People understand they must create ‘victory’ out of whatever they are handed and in this case we think there has been a long series of humiliating capitulations leading to this point,” he told Murnaghan.

“It is not going to answer the concerns of the British people. We need the power in our own parliament to determine what our migration policy is,” he told Sky News.

A ComRes poll for the Daily Mail at the weekend showed a surge in support for Britain remaining in the EU, with 54 per cent saying they would vote to stay in, compared to 36 per cent who would vote to leave.