Brussels, February 1

Britain and the EU warned today that more work is needed to seal a deal on changes to Britain’s membership of the bloc by the end of the day and allow David Cameron to hold a referendum as he hopes this summer.

Diplomats were locked in intensive talks in Brussels after the British premier and European Union President Donald Tusk set a 24-hour deadline for a draft accord after talks in London broke down on Sunday night.

Without a draft there will be no time for European capitals to sign off on a full deal at an EU summit later this month, in turn ruling out Cameron’s preferred date of June for a vote on whether Britain should stay in the bloc.

London’s bid to transform its membership of the EU has sparked turmoil, coming as the 28-nation alliance struggles with the biggest influx of migrants since World War II and the fallout from the eurozone debt crisis.

“There is more hard work to be done,” Cameron’s spokesman told reporters in London. “We are making progress but there’s more work to do in all four areas — more work in some areas than others.”

The four demands include safeguarding EU countries like Britain that are not part of the euro single currency, ensuring greater EU economic competitiveness, opting out of the goal of ever closer union and restricting access to benefits for EU workers in Britain.

Cameron’s spokesman hailed ‘substantial’ signals from the European Commission on a deal for a so-called ‘welfare brake’ that would allow London to exclude EU migrants from benefits, such as income top-ups for low-paid workers.

The Commission — the powerful executive arm of the EU which is responsible for initiating legislation — said there was ‘progress’ but stressed that any deal still needed the backing of all 28 EU nations.

“We are not there yet. Nothing is agreed until everything is agreed,” Margaritis Schinas, a spokesman for Commission Chief Jean-Claude Juncker, told reporters.

An EU source told AFP: “Only one basket is really ‘closed’.”

Although Cameron has only set a deadline of the end of 2017 to hold a referendum and insists he is in ‘no hurry’ for a deal, sources have said he is keen to push a vote through by June.

That would avoid any new flare-up in Europe’s migration crisis this summer and before British eurosceptics, particularly in his own Conservative party, become even more unruly.