Reform or fail says Blair

Tony Blair today confronted a deeply hostile European parliament with an uncompromising call for painful reform.

In blunt language he warned the EU faced "failure on a grand strategic scale" if it did not respond to new economic and political pressures.

He also hit out at leaders such as France's Jacques Chirac for opposing change, saying the people of Europe were desperate for leadership and were not getting it.

Mr Blair was braced for a potentially rowdy reception as he arrived at the Brussels parliament-building to make the keynote address and sit through a three-hour debate with some of his most angry opponents.

In a sign of the mood, the same audience yesterday gave a rapturous ovation to one of his severest critics - Luxembourg's Jean-Claude Juncker - for a speech that sharply criticised Mr Blair and accused him of blocking a budget deal at last week's failed summit. And one Brussels-official privately told the Evening Standard: "I hope they boo your Mr Blair."

Undaunted by the rumblings, Mr Blair was due to say Europe could not postpone a "moment of decision" after the rejection of its constitution and the growing economic rivalry of China and India.

Urging fundamental reforms, including cuts to farming subsidies which have outraged the powerful French agriculture lobby, Mr Blair was planning to say Europe would face disaster if it shrank away from change or huddled around failing past policies. "If Europe defaulted to Euro-scepticism, or if European nations faced with these immense challenges decide to huddle together hoping we can avoid globalisation, shrink away from confronting the changes around us, take refuge in the present policies of Europe, as if by constantly repeating them we would by the very act of repetition make them more relevant, then we risk failure," he was expected to say.

"Failure on a grand strategic scale."

Replying to sharp attacks from Mr Juncker and French President Chirac, Mr Blair went on: "This is not a time to accuse those who want Europe to change of betraying Europe. It is a time to recognise that only by change will Europe recover its strength, its relevance, its idealism and therefore its support among the people.

"This is a moment of decision. The people of Europe are speaking to us. They are posing the question. They are wanting our leadership. It is time we gave it to them."