The government has been defeated in Parliament on the EU budget after 53 Conservative MPs defied their party over the issue.

Tory rebels joined with Labour to pass an amendment calling for a real-terms cut in spending between 2014 and 2020.

As the fall-out of the defeat continued, Deputy Prime Minister Nick Clegg - Lib Dem leader - said the idea that Britain "could extract ourselves from the bulk of EU negotiations is nonsensical".

In the speech to the Chatham House international affairs think-tank, he added: "What kind of club gives you a full pass with all the perks, but doesn't expect you to pay the full membership fee?"