David Cameron under intense pressure from pro-EU Tory backbenchers on eve of long-awaited referendum speech

David Cameron came under intense pressure on Europe today from the rival factions inside the Conservative Party on the eve of his landmark speech in which he will promise an eventual referendum on the issue.

A group of 25 pro-EU Tory backbenchers wrote to the Prime Minister urging him to set out a "positive British vision for leadership in Europe" in his long-awaited speech in the Netherlands tomorrow. They said: "We are concerned that an over-emphasis in your speech on renegotiation and a referendum rather than leadership could undermine the [EU] single market. The UK has potential allies on many key issues, even on the merits of repatriating some powers.”

The MPs, including the former Cabinet ministers Sir Malcolm Rifkind, Caroline Spelman and Stephen Dorrell, warned: "We fear that a renegotiation which seems to favour the UK alone would force other capitals to ask why they cannot simply dispense with those parts of the single market that don't suit them."

But Mr Cameron received conflicting advice from three long-standing Eurosceptics - John Redwood, Bill Cash and Bernard Jenkin – who declared that concerns about the single market could not be allowed to override all other considerations regarding Britain's relationship with Brussels. They published pamphlet, “The EU Single Market - Is It Worth It?”, which argues that its benefits are "vastly overstated", claiming that the EU is in long-term decline while Britain's non-European markets were expanding and offering greater opportunities.

Mr Jenkin said: “The idea that the EU 'single market' has to be the only factor which overrides all other considerations of policy about the EU is wrong. It is one amongst many.”

Ed Miliband warned today that a Europe referendum would create uncertainty and damage the economy. "The Prime Minister is taking us to the economic cliff," he told BBC Radio 4’s Today programme. "I fear the Prime Minister's strategy is leading us towards the exit, which will cause real damage to our economy.”

The Labour leader tried to head off Tory attacks on his party for being too pro-European by saying that Britain needs to regain “some powers” from Brussels. He cited regional policy, so that the UK Government could have a more pro-active industrial strategy.

Nick Clegg also warned that a referendum could jeopardise job-creating foreign investment in Britain. In his weekly phone-in on London’s LBC radio, the Deputy Prime Minister said: "I don't think you protect the jobs dependent on Europe if you suggest you're headed to the exit door. I believe that having years of paralysing debate of if we're in or out of [Europe] is damaging."