Brussels welcomes UK in from cold

"Britain has come in from the cold," was the view expressed by Britain's partners in Brussels yesterday after their first round of talks on European reform with the new government.

The comments displayed the goodwill being shown to the new Labour government, and the determination of other governments to ease Tony Blair's path to a deal at the Amsterdam summit in June.

The Europeans were pleased also by signs of a shift in the negotiating position on European reform displayed by the Government four days after its election victory. They were viewed as significant after 18 months of stalling by the Conservative government. Doug Henderson, the new Minister for Europe, spoke about the desire to "co-operate" with Europe in a tone rarely heard in Brussels in recent years.

As most EU leaders concede, Britain did not need to make a major lurch towards integration in order to come closer into line with Europe. Few member states have an appetite for federalism and most would be content with moderate reforms at Amsterdam. In France, where a rise in Euro-scepticism has been seen during the election campaign, there was particularly satisfaction at Britain's new platform on Europe.

Mr Henderson won over other member states by making good Labour's manifesto pledge to sign up to the Social Chapter, signalling an end to the five- year "opt out" secured by John Major at Maastricht.

Mr Henderson, speaking in the Council of Ministers' building at a meeting of the Inter-Governmental Conference on European Reform, confirmed Labour would support an employment chapter in the new Amsterdam Treaty.

He indicated other areas where the Government would make compromises, which the Conservatives rejected, to overhaul EU institutions in readiness for enlargement. Among the Government's priorities in Europe, he said, would be completion of the single market, enlargement to the East, reform of the Common Agricultural Policy, and unemployment.

Areas of possible compromise in the Amsterdam treaty talks included:

* Probable agreement to a limited extension of qualified majority voting in such areas as regional aid decision-making, industry and the environment.

* More powers for the European Parliament over policies which the Council of Ministers decides by qualified majority.

* Readiness to consider the introduction of multi-speed or "flexible" decision-making in areas such as foreign policy, justice and home affairs.

* Readiness to consider compromise on asylum and immigration control. While Britain would retain frontier checks, it might consider greater integration of policies.

Despite the cordial atmosphere, yesterday's discussions threw light on the minefield which the Government has to negotiate as it attempts to justify its signature of the Social Chapter to doubters at home.

In June, social policy ministers are expected to accept plans to make it easier for victims of sexual discrimination in the workplace to prove their case against employers. Measures to curb sexual harassment are also being prepared.

But a confrontation appears to be looming between the European Commission and the new Government over whether a manifesto pledge to reduce VAT on fuel can be allowed under an EU directive.

The EU is starting moves to harmonise taxes and is pressing member states to adopt commons standards on VAT.