London Chancellor Osborne: Reform EU or Face UK Exit
The UK could be forced to quit the European Union if the organisation does not reform, George Osborne has warned, as cited by BBC.
The chancellor said it was essential to "protect the collective interests of non-eurozone member states" while the rest of the EU forged stronger links.
Without such reform, the UK might "face a choice between joining the euro or leaving" the EU, he said.
The 28-member group also had to do more to ensure economic competitiveness with rivals like India and China, he added.
Osborne's speech followed the Conservative leadership rejecting a call from 95 of the party's MPs to allow Parliament to block EU laws which damage the national interest
Earlier this week Foreign Secretary William Hague said the EU's rules had to be followed by all its members and the MPs' veto plan was unworkable.
But addressing the think tank Open Europe and the Fresh Start group of MPs, set up by Conservatives keen to see reform, Osborne said he understood the need for change, especially given further economic and political integration by EU countries within the eurozone, aimed at preventing a repeat of the recent crisis.
He warned: "If you cannot protect the collective interests of non-eurozone member states, then they will have to choose between joining the eurozone, which the UK will not do, or leave the European Union."
He also said: "I believe it is in no-one's interests for Britain to come to face a choice between joining the euro or leaving the European Union.
"We don't want to join the euro, but also our withdrawal from a Europe which succeeded in reforming would be bad for Britain. And a country of the size and global reach of Britain leaving would be very bad for the European Union."
The Conservative Party has promised an in-out referendum on EU membership - following a renegotiation of powers with Brussels - before the end of 2017, if it wins a majority at the next general election.
Osborne said: "The biggest economic risk facing Europe doesn't come from those who want reform and renegotiation.
"It comes from a failure to reform and renegotiate. It is the status quo which condemns the people of Europe to an ongoing economic crisis and continuing decline."
Osborne argued there was a "simple choice for Europe: reform or decline".
He said: "There are those who throw their hands up and say 'We can't reform Europe'. To them, I would say that we have already proved that wrong.
"Take the EU budget. Last year, the prime minister negotiated the first ever real-terms cut... Far from being a lone voice, we were working with like-minded countries like Germany, the Netherlands and Denmark."
Osborne talked about how the 2008 financial collapse had exacerbated the EU's problems, but argued: "We knew there was a competitiveness problem in Europe before the crisis.
"But the crisis has dramatically accelerated the shifts in the tectonic economic plates that see power moving eastwards and southwards on our planet."
He said too much money was going on benefits across the continent: "Europe accounts for just over 7% of the world's population, 25% of its economy, and 50% of global social welfare spending."
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The EU not Europe accounts for just over 7% of the worlds population, it really irritates me that polticians can't distinguish between the Eurozone, the EU and Europe. One is geographical, the other two are geo-political terms. He needs to go back to university and learn a few things instead of spending all day in a debating society.