Don't believe the Downing Street spin - Cameron is not getting a good deal for Britain in Europe

By Tim Montgomerie

I increasingly believe that this Coalition could be a great reforming government. On schools, welfare, policing and deficit control Cameron and Clegg are, I readily admit, exceeding my early expectations.

I'm also open to the argument that if the Conservatives hadn't been in an alliance with the Liberal Democrats we might have been free to take a more robust position with Brussels.

What I'm not willing to believe is the Downing Street spin that limiting the increase in the EU budget to +2.9% is a victory. It isn't.

During the Labour years three Treaties - Amsterdam, Nice and Lisbon - saw significant powers transferred to the EU. And, let's admit it, previous Tory governments surrendered too many powers too. What we thought, however, was that, in opposition, our party had become sincerely Eurosceptic. We became sincerely Eurosceptic in reaction to the fact we are no longer a nation in charge of our destiny. New research from the Commons library - highlighted in today's Telegraph - notes that up to half of UK laws are 'made in Europe'.  After last year's passage of Lisbon, David Cameron promised to begin a serious process of renegotiation that would see some powers restored to Britain. Commentators didn't have much faith in that promise at the time because, it was said, we had no bargaining power. In Lisbon the EU had got what it wanted and wouldn't need anything else from Britain for many years. That changed with the recent decision of Merkel and Sarkozy to seek a Treaty amendment that would allow Brussels to punish fiscally irresponsible members of the €urozone. They need Britain's agreement for such an amendment but Cameron is selling that agreement cheaply. There does not seem to be any attempt to get some powers back in return for giving Merkel and Sarkozy what they want.

A week or so ago Cameron appeared to decide that the one thing he would secure would be a freeze in Britain's contribution to the EU budget. Unfortunately his aides have decided that even that isn't possible. Last night Downing Street was celebrating the likelihood that the increase in the EU budget would be limited to 2.9%. That's half of what the increase might have been but it was always expected that Germany, France and other big states would never support a 6% increase either.

Since the Coalition came to power significant powers have been ceded to the EU. This Coalition is going to be good for Britain in many ways but noone should believe that Cameron or Hague have the will to do anything other than manage our existing relationship with Europe. There is no ambition for any serious renegotiation.