Britain strikes deal to reduce veto on joint EU foreign policy

The Government has struck its first significant deal with its European partners since coming to power by accepting a reduction of the British veto over joint foreign-policy decisions.

Announced by foreign ministers in Luxembourg yesterday, the deal will help smooth the way for completion of the Amsterdam Treaty, due to be signed by heads of government in two weeks.

The move is the latest indication that the new Government will accept greater power-sharing between EU member states than its predecessor. Under the deal significant decisions on foreign policy will be decided by a qualified majority of states.

The draft treaty text presented by the EU Dutch presidency, and now agreed by all 15 EU countries, states that the EU will decide only broad foreign policy strategy by unanimity. The nuts and bolts of how these strategies are implemented on the ground will then be decided by qualified majority.

If Britain does not want to participate in the implementation of a policy; if, for example, if it does not want to send aid to a country or impose sanctions, it could refuse.

However, the objecting state would not be able to stop the others from going ahead. A single government would only be able to veto plans "for important and stated reasons of national policy".

Although the foreign policy section of the Amsterdam Treaty is now almost finalised, the debate over whether the EU should appoint a senior figure to represent it on the foreign policy stage has still not been resolved. Britain and France are keen to appoint a weighty political figure to the job, while the other member states want a senior EU functionary.

Britain still has significant differences with its European partners over common EU defense. The Government is objecting to moves by France and Germany to incorporate the Western European Union, the body which co-ordinates European defence, inside the EU.

Meanwhile, Tony Blair's commitment to the European Social Chapter will be put to its first serious test today, when Brussels moves to bring in rules which could lead to sanctions on British employers who fail to consult and inform their staff about management decisions.

The Prime Minister warned in Noordwijk 10 days ago that although Britain would sign up to the Social Chapter, he would not tolerate a flood of burdensome new legislation which might harm British competitiveness.

The Government will be faced with the unpalatable prospect of two further measures under the Social Chapter within days. On Friday the Commission will announce it is to draft legislation to extend the part-time workers' rights, while next week in Luxembourg EU ministers are tipped to reach agreement on making it easier for workers to challenge bosses over sex discrimination.