November 3, 2015 / 2:33 PM / 3 years ago

UPDATE 2-Britain's Osborne to Germany: let's do a deal on EU reform

(Adds Merkel comments, paragraphs 8,9)

* Offers British support for euro zone integration

* Wants legal guarantee Britain won’t bear euro zone costs

* UK polls show narrowing of support for staying in EU

* Merkel says “We will do what we can so Britain can stay”

By Paul Carrel

BERLIN, Nov 3 (Reuters) - British finance minister George Osborne appealed to Germany on Tuesday to ensure euro zone decisions and costs are not imposed on Britain and promised in exchange the country’s help in making the single currency union stronger.

Osborne, seen as the frontrunner to succeed Prime Minister David Cameron, is leading a new round of talks in European capitals, keen to sell Britain’s proposals for reform while keeping vocal eurosceptics in his own party at bay before a referendum on membership of the bloc by the end of 2017.

Speaking to government and business leaders in Berlin, Osborne outlined what he said were “the changes we need to stay in the European Union”.

“Let me be candid: there is a deal to be done and we can work together,” he said at an event sponsored by the Federation of German Industry (BDI).

“Rather than stand in your way and veto the treaty amendments required, we in Britain can support you in the euro zone make the lasting changes that you need to see to strengthen the euro.

“In return, you can help us make the changes we need to safeguard the interests of those economies who are not in the euro zone,” he said.

With British opinion polls showing a narrowing of support for staying in the EU, Cameron’s government is under increasing pressure to take on eurosceptics in both his ruling Conservative Party and the opposition Labour camp directly.

German Chancellor Angela Merkel said she wanted Britain to remain a member of the EU, telling the BDI meeting: “We will do what we can so that Britain can stay.”

But she said in the end it would be up to Britons to decide.

Nigel Farage, leader of the anti-EU UK Independence Party (UKIP), described Osborne’s speech as “sycophancy” and said it sounded “more like a speech from an EU Commissioner.”

“Who is he actually working for?” Farage asked.

Osborne has made protection for states in the EU but outside the 19-member single currency area a priority for the renegotiation to defend Britain’s financial services which account for about 8 percent of its economy.

Setting out the deal he proposed making with Germany and other euro zone countries, Osborne said the “inexorable logic” of monetary union would mean the EU’s treaties would have to be changed to support closer economic union between its members.

“When it comes to the relationship between those who use the euro and those who do not, here is the deal: you get a euro zone that works better, we get a guarantee that euro zone decisions and costs are not imposed on us,” he said.

“You get a stronger euro. We make sure that the voice of the pound is heard when it should be. A deal that is written into law, a deal that is good for Britain and a deal that is good for Germany too. The result will be a better European Union.”

Cameron launched his most open defence to date of Britain staying in the EU last week by telling eurosceptics that the country should not try to emulate outsider Norway which pays the same amount to the bloc but is not a member. (Editing by Louise Ireland)

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