Brown hailed the EU leaders' decision yesterday to call a halt to further institutional reform "for the foreseeable future". The prime minister also said he had been happy to go to Lisbon for the signing ceremony on Thursday, and his influence had not been diminished by his late arrival.

He said he was "excited" that the EU had finally recognised the need to focus on the challenges of prosperity, terrorism, climate change and jobs. He sought to play down the significance of the new group, to be chaired by the former Spanish prime minister Felipe González, saying it would not look at institutional change at all.

But Sarkozy, initial advocate of the 10-strong group, claimed its members would consider how to reinvent the original dream of Europe's founders, including political integration.

He made plain that the group would discuss "whether Europe should have frontiers or not, and what consequences this would have".

The Conservatives claimed Brown had opened "a pandora's box" by allowing an old-style socialist as the EU group leader.

The European commissioner, Peter Mandelson, also criticised Brown's diplomatic efforts in Europe, saying: "In politics, you don't win an argument by putting yourself on the back foot. If you have a case, you make it confidently, you present it with conviction."