Nick Clegg warns European veto 'bad for Britain'

Deputy Prime Minister Nick Clegg says David Cameron's veto of EU treaty changes was "bad for Britain" and could leave it "isolated and marginalised". But he blamed French and German "intransigence" and pressure from Eurosceptic Conservatives for putting the PM in "a very difficult position". Initially Mr Clegg said the coalition was united over the use of the veto. But he told the BBC he had "made it clear" to Mr Cameron it was "untenable" for him to welcome the move. Sources close to Mr Clegg have told the BBC he "couldn't believe it" when he was told the summit in Brussels had "spectacularly unravelled". The prime minister blocked changes to the EU's Lisbon Treaty at an EU summit, arguing that the proposed changes were not in the UK's interest. It now looks likely that all 26 other members of the European Union will agree to a new "accord" setting out tougher budget rules aimed at preventing a repeat of the current eurozone crisis. 'Bitterly disappointed' As leader of the Liberal Democrats, Mr Clegg is far more pro-European than his Conservative coalition colleagues. He told the BBC's Andrew Marr programme: "I'm bitterly disappointed by the outcome of last week's summit, precisely because I think now there is a danger that the UK will be isolated and marginalised within the European Union. "I don't think that's good for jobs, in the City or elsewhere, I don't think it's good for growth or for families up and down the country." He said he would now be doing "everything I can to ensure this setback does not become a permanent divide". The deputy PM said he had learned of the veto in a phone call from the prime minister at 0400 GMT, shortly before Mr Cameron gave a press conference announcing it publicly. Asked what his reaction had been, the Lib Dem leader said: "I said this was bad for Britain. "I made it clear that it was untenable for me to welcome it." Mr Cameron has said he was seeking certain "safeguards" from Europe on protection of the single market and the UK's financial services industry. French President Nicolas Sarkozy called those demands "unacceptable". Mr Clegg said this unwillingness to negotiate from France and Germany, combined with "outright antagonism to all things European" from parts of the Conservative Party, had left Mr Cameron in a difficult position. "He couldn't come back to London empty-handed because self evidently, if he'd done so, he wouldn't have been able to get whatever had been agreed through the House of Commons so all we would have had would have been a delayed crisis." On Friday, a spokesman for Mr Clegg said he had been "consulted throughout" the 10 hours of unsuccessful negotiations in Brussels - a claim backed up by Foreign Secretary William Hague. He told the BBC the Lib Dem leader was fully "signed up" to the decision to veto the proposed treaty. Eurosceptics 'encouraged' Labour's shadow foreign secretary Douglas Alexander accused David Cameron of being motivated by "the politics of the Conservative Party", not a desire to protect UK interests. "He didn't want a deal. He was keener instead to exploit the situation because of his position in the [Conservative] party. "He hasn't sated the appetite of Eurosceptic backbenchers - he has simply encouraged them." Mr Alexander said he did not think the deal eventually achieved in Brussels would actually stabilise the eurozone. There's essentially an austerity pact that's been agreed that could work for Germany, but I struggle to see how it could work for Greece, for Portugal, for other countries around Europe." Mr Hague insisted Britain was "not marginalised" and the UK would continue to "work closely with our partners on foreign policy, on the single market, and so on". He told Sky News "everybody knows" that the Tories and Lib Dems took different approaches to Europe but worked through all issues to "a common position". "The negotiating position that David Cameron took on Thursday night and Friday morning was agreed in advance with the Lib Dems in the coalition." But Lord Oakeshott said Lib Dem Business Secretary Vince Cable had "given a very serious warning last Monday in the cabinet against elevating these financial regulation points into a make or break deal". The Lib Dem peer said Mr Cable would now be "fighting to ensure" the UK gets back around the negotiating table in Europe to rebuild bridges. Asked about Labour's allegation that Mr Cameron did not genuinely want to reach a deal in Brussels, Lord Oakeshott told the BBC's Politics Show he believed "a walk-out quite suited him". Former Lib Dem leader Lord Ashdown told the Observer the veto had "tipped 38 years of British foreign policy down the drain", but the coalition government must survive. Mr Cameron will make a statement in the House of Commons on his decision on Monday. He and his Chancellor George Osborne have insisted the veto was in part to protect the City of London from excessive intervention by Europe, but Labour and the UK Independence Party have both warned that actually no additional safeguards for it were achieved. UKIP leader Nigel Farage said the City was "under very serious threat" of "retribution", adding: "Every time the bond markets twitch I can see the finger being pointed at those awful Anglo Saxons in the City of London."