PM in veto pledge over EU budget

David Cameron has sought to rally restive Tory MPs with a pledge to use Britain's veto to block the European Union budget if it is not in the UK interest.

On the eve of the Conservative Party conference in Birmingham, the Prime Minister said that he would not stand for "outrageous" attempts to increase the overall EU budget in negotiations on spending for the period 2014 to 2020.

"If it comes to saying 'no' to a deal that isn't right for Britain, I'll say 'no'," he said in an interview with The Sunday Telegraph.

He also proposed a "bold thinking" plan for the EU to have two separate budgets - one for the 17 eurozone nations and the other for the 10 - including Britain - outside the single currency. Such a plan is likely to prove highly popular with Conservative MPs who have been pressing for a referendum on Britain's future in the EU.

But it will increase tensions with their Liberal Democrat coalition partners - who reacted with dismay when he used Britain's veto to oppose the EU fiscal pact last December. That is unlikely to be of immediate concern for Mr Cameron, who faces a potentially tricky week with the party trailing Labour in the polls and the economy mired in recession.

The Prime Minister acknowledged that he needed to do more to explain to voters what the party was doing in government.

"You spend a lot of time governing and deciding, and you don't spend enough time explaining. And I think conference week is a real opportunity to get out there and explain," he said.

He also made clear that he was not ready to concede the political centre ground to Ed Miliband after the Labour leader's party conference speech claiming his was the true "One Nation" party.

"Are the Conservatives deserting the common ground of British politics? Absolutely not," he said.

He attacked Mr Miliband for "signalling right but turning left" and poured cold water on his much-trumpeted feat of speaking for more than an hour without a text. He said: "It is difficult to give a speech without notes for 70 minutes. It's even more difficult when you haven't got anything to say."