A new special relationship - with Germany

AN ANGLO-GERMAN ministerial working group is to draw up common policies and a charter promoting the centre-left in Europe in an unprecedented alliance which has infuriated British Eurosceptics, writes Rachel Sylvester.

Tony Blair and Gerhard Schroder, the German Chancellor, have agreed to co-operate at the highest level in drawing up joint proposals for the economy, crime prevention, welfare, the future of the EU, and the operation of the single currency - even though Britain has not yet joined the euro.

The working party - Peter Mandelson, the Secretary of State for Trade and Industry, and Bodo Hombach, the German minister for the Chancellery - will meet for the first time today. It will present a "modernising social democratic charter" for Europe and a raft of centre-left policies at an Anglo-German summit next spring.

The group - the first institutionalised ministerial link between Britain and another European country in peace time - is further evidence of Mr Blair's determination to move closer to the rest of Europe.

Eurosceptics last night reacted with fury to the move, saying it was further evidence of the Government's willingness to water down Britain's independence and of a gradual shift towards a federal Europe.

John Redwood, the shadow trade and industry spokesman, said: "Mr Mandelson is part of a plot to give Britain away by stealth. He wants to work with Germany to draw us into a high tax, highly regulated Europe, hoping that the British people will not see what is going on."

Senior Government insiders described the initiative as the writing of a "new clause four" for Europe - similar to the redrawing of Labour's constitution, which was symbolic of the party's modernisation.

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