On Monday, senior diplomats – known as sherpas – from Britain, the European Commission and the European Council are meeting to hammer out a draft deal.
Donald Tusk, the Council president, is tonight expected to declare whether a text has been agreed that will be acceptable to the other 27 states. If so, a paper will be released tomorrow, opening the door to a final deal at a European Council summit on February 18. Sherpas from all 28 states are expected to meet on Friday.
If not, it puts the prospect of a summer referendum in serious doubt.
The talks were extended for 24 hours following a meeting over dinner between Mr Tusk and Mr Cameron in Downing Street on Sunday night.
In a rare piece of public commentary on the talks – which have hitherto been held in relative secrecy in Brussels - No 10 claimed a “significant breakthrough” after Mr Juncker’s office said that the UK’s current levels of EU migration would justify the imposition of an “emergency brake” on benefits.
“On welfare, the Commission have tabled a text making clear that the UK’s current circumstances meet the criteria for triggering the emergency brake. This is a significant breakthrough, meaning the Prime Minister can deliver on his commitment to restrict in work benefits to EU migrants for four years,” Downing Street said.
The brake is a device drawn up by Mr Juncker’s office as an alternative to Mr Cameron’s absolute four-year ban on benefit claims by EU migrants.
But the British government insists it would have to come into force immediately after the referendum, and that the Prime Minister will “not do a deal at any price”.
The European Commission on Monday confirmed an offer had been tabled, but hinted that Downing Street was premature to declare victory.
“We do not negotiate via the media,” said Mr Juncker’s spokesman. “It is not enough for the Commission and Council lawyers to agree. This is a process that is run at 28, and the Commission works for all 28 member states of the union."
The spokesman refused to say whether Downing Street’s statement meant that Mr Juncker agrees that EU migration to the UK is too high.
Mr Michel told Mr Cameron as the renegotiation began that he would resist any attempt to unpick free movement or reverse the achievements of European integration. "If you want to go, just go. We will not let you ruin Europe by staying,” he was quoted as saying.
But today he told Le Monde that all of Europe could benefit from the British reforms.
“I think that it is brave on the part of a prime minister to organise this referendum and that it's in everyone's interests, including that of Britain, that this country remains inside the Union," he said.
“The issues raised by Mr Cameron are difficult to resolve but must be treated as opportunities for the EU. Competition, Europe's legitimacy - what he calls sovereignty - and the greater implication of national parliaments: these are important questions and can improve the way Europe works. The difficult question of free movement remains but by examining jurisprudence, perhaps a solution can be envisaged."
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