'Federal' cut from EU blueprint after Blair protests

The word "federal" is to be excised from a draft European Union constitution at Tony Blair's request, under a deal struck yesterday with advisers to Valéry Giscard d'Estaing, the former French president who is drawing up a blueprint for the future of Europe.

After lengthy negotiations, M. Giscard's "praesidium" of 12 senior aides decided to remove the "f-word", which has provoked fierce opposition in Downing Street because of its "superstate" overtones.

However M. Giscard's spokesman said that the politically sensitive objective of achieving "ever closer union" would be included in the preamble, which has yet to be agreed. Most of the updated draft constitution is expected to appear on Monday, minus the preamble, which will be completed later.

The proposals must be debated by M. Giscard's full convention of 105 politicians, before being handed to EU leaders next month. Heads of government have the final say on the new constitution, which has to be agreed unanimously.

Mr Blair, who met M. Giscard in Downing Street last week, has expended huge political capital in his battle to remove the word "federal", which appeared in the first article of the first draft of the constitution. The passage said that the EU "shall administer certain common competences on a federal basis".

Defenders of the phrase argue that this merely describes the present situation and note that in most European countries the word "federal" implies decentralisation. But in Britain the "f-word" has been seized on by Eurosceptics as evidence of an attack on national sovereignty.

M. Giscard's spokesman explained why "federalism" was excluded: "This word has additional meaning in some languages and in some countries which apparently makes it offensive." M. Giscard's concession to Mr Blair follows a ferocious newspaper campaign in Britain against the draft constitution, with accusations that it would usher in "tyranny".

M. Giscard is expected to make clear that any efforts to scrap national vetoes in taxation and social security will be limited and not usher in harmonisation. Meanwhile, he seems set to press on with British-backed plans to create a permanent president of the European Council, where heads of government meet. That has alarmed the small nations, which are also anxious about M. Giscard's proposals to slim the European Commission, eventually depriving them of the automatic right to have a commissioner with full voting rights.

The argument over these proposals was ignited in the praesidium yesterday when Spanish representatives sought to block any significant changes, leaving M. Giscard's plan without approval.

When the text of the constitution appears on Monday not everything will be to Mr Blair's liking. It will allow the countries which are members of the euro to exclude Britain from some of their decisions on economic policy. Despite British worries over plans to create a new EU "foreign minister", the proposal will not be watered down, nor will there be any move to shift the European Commission's limited foreign policy powers to the Council, the preserve of the member states.

There will be no dilution of the commitment to incorporate the EU's charter on fundamental rights into the constitution, giving it full legal status. The UK is still haggling over this, calling for it to be written into a protocol with a legal commentary putting it in context, rather than the formal text.

Monday's document is expected to refer to the EU as being based not only on member states but on citizens too, a reference to European citizenship, and may include a reference to the EU having power to co-ordinate certain policies.

Some supporters of closer integration believe M. Giscard may already have made too many compromises to help Mr Blair. Andrew Duff, a Liberal Democrat MEP and member of the convention, said the praesidium's job was "to reflect the weight of argument in the Convention". He said: "If it fails to do this and has instead followed its own agenda, the reaction in the Convention next Friday will be explosive. Neither my consent to the draft constitution nor that of my Liberal colleagues can be presumed."

Gaining a consensus is vital to M. Giscard. Without one it will be much easier for member states to unpick the document which has taken 15 months to put together.