David Cameron is facing a Commons defeat over Europe as Labour joins a ‘Maastricht-style’ alliance with Tory Eurosceptics to remove any bias in the referendum campaign.
As the Prime Minister prepares for Parliament’s return on Monday September 7, the Opposition looks set to vote against his latest plans for so-called ‘purdah’ rules on how public money is spent during the last four weeks of the campaign.
Labour sources have told The Huffington Post UK that it is now "very possible" that the party will vote down Amendment 35 to the EU referendum bill.
The bill's amendment was unveiled by the Foreign Office last week in a bid to reassure rebels that it was taking their concerns seriously.
But critics instantly declared that the Government hadn’t gone far enough on ‘purdah’ and had instead rewritten the rules to allow ministers to use taxpayers’ money on issues that weren’t ‘directly’ related to the question of Britain quitting the EU.
HuffPost UK has obtained a Commons Library note on the amendment which appears to contradict a letter from the Tory whips office claiming that MPs could be barred from speaking out in the final 28 days of the campaign.
The note makes clear that the current law "does not prevent Members from campaigning in a referendum or incurring and meeting expenses in connection with the referendum as long as those expenses are not met from the public purse."
Earlier this summer, 27 Tory rebels defied Mr Cameron to demand tougher rules to stop any bias towards at an ‘In’ vote, which they expect him to try to lead once he has renegotiated the UK’s powers with Brussels.
The row comes as a new Survation poll for the Mail on Sunday revealed that more than half of the public (51%) would now vote for ‘Brexit’, following a rewording of the referendum question to ask if they wanted to ‘remain’ or ‘leave’ the EU.
The referendum question has been changed from a simple 'Yes/No' following fears among Tories that a 'Yes' question would give an unfair advantage to those wanting to stay in the 28-nation bloc.
Writing for HuffPost UK today, Shadow Foreign Secretary Hillary Benn agreed with Tory Eurosceptics that ministers had to come to Parliament to get any exemptions to purdah rules.
“If ministers have specific proposals for any change to the current rules they should make their case and let MPs vote on them,” he writes.
“This is why Labour has tabled an amendment to reinstate the purdah rules governing the use of Government resources during the campaign, while allowing ministers to propose certain limited exemptions to be voted on by Parliament.”
He also gave his clearest hint yet that Labour was ready to vote with Tory rebels against the latest Government plans.
“In the last few days minister have finally moved in our direction but they still need to get the detail right,” he says.
“For all of us who believe that it is strongly in our national interest to remain part of the EU, it is essential that the campaign is seen to take place on a level playing field.
“Apart from being about fairness, it will also make it harder for those who want to leave the EU to complain about the process when actually they are afraid that they will lose the argument.”
Robert Oxley, of Business for Britain, added: “Rules on taxpayer funded government campaigning have cross party support.
"Zero evidence has been provided to justify weakening them.”
Eurosceptic sources suggested that Tory rebels would also vote for Labour’s own amendment on ministerial exemptions and were set to vote against Amendment 35’s change to the current rules.
In a further danger sign for the Government, leading Tory Eurosceptic Steve Baker said that he wanted guarantees that Brussels would not spend its own cash trying to influence the UK result. A fresh amendment is being backed by 100 Tory MPs.
Eurosceptic group Conservatives for Britain today unveiled their latest list of vice presidents, including Liam Fox, Owen Paterson and Norman Tebbitt.