Enda Kenny leaves the European Council headquarters after a night of negotiations the EU leaders summit in Brussels

BRITISH Prime Minister David Cameron dramatically vetoed a European Union Treaty change today, forcing the most far-reaching EU shake-up in decades.

At least 23 of the 27 member state, including Ireland, are now going ahead with their own treaty to bring in tougher economic sanctions and restore single market credibility and stability. The new fiscal pact will ensure tougher budget discipline.

Only the UK and Hungary were certain today to stay out of the new grouping, with Sweden and the Czech Republic consulting their parliaments before deciding.

But Mr Cameron was unapologetic at a dawn press conference in Brussels after 10 hours of talks at a summit in Brussels.

He said he wished the eurozone well with its new treaty, but the UK could not accept it as the safeguards he had demanded were not on offer.

The British Prime Minister declared: "I had to pursue very doggedly what was in Britain's interests, which is very difficult in a room where people are pressing you to sign up to things because they say it is in all our interests."

What was in Britain's interests, said Mr Cameron, was to win guarantees that in return for backing a 27-nation treaty change to bring in a new "fiscal compact", the UK's voice in crucial policy issues on the single market and the financial services sector - would not be diminished.

Without such guarantees he did not back the treaty, prompting Germany and France to lead the move to set up a separate treaty to achieve their aims.

Ideally Mr Cameron wanted a treaty change agreed by all 27, with the necessary UK safeguards to ensure crucial decisions were not taken with full UK involvement.

But before the summit the Prime Minister said that even a "17-plus" deal did not mean any change in Britain's own EU treaty obligations.

Efforts to agree a 27-way treaty change were abandoned just before dawn, after 10 hours of talks on what to do to pave the way for tougher economic rules and thus more market confidence in the ability of the euro to overcome its troubles and avoid future seismic shocks to the system.

Mr Cameron argued hotly that he needed to take home clear evidence that British backing would not mean compromising the country in Europe.