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No halfway house on Europe: Clegg

Deputy Prime Minister Nick Clegg has warned eurosceptics of the dangers of the UK ending up in a "halfway house" which could damage the economy by loosening ties with Brussels.

In a speech to business leaders, Mr Clegg warned against a process of "lonely renegotiation" which would harm the UK's position within the European single market as he stressed the Liberal Democrats' opposition to a referendum timed to placate restive Conservative backbenchers.

Mr Clegg also insisted the Government was finally "turning a page" on the economic "mess" left by Labour but acknowledged more could be done to prepare young people for the world of work as he announced a review into support for 16 to 24-year-olds.

Earlier this month the Confederation of British Industry (CBI) warned that a Norwegian or Swiss-style relationship with the European Union, as advocated by some of those in favour of withdrawal, would not be better than full membership for the UK.

The Lib Dem leader, a staunch pro-European, echoed those views as he told the CBI president's dinner: "We believe Britain needs to be in Europe, not out - and that we should be leading in Europe in favour of reform.

"Yes to being in Europe. No to exit. Yes to a referendum when the rules change for Britain. No to a referendum when Conservative backbenchers demand it.

"Yes to reform. No to years and years of lonely renegotiation that will cede control not strengthen it and damage our position within the single market."

Mr Clegg backed the CBI's position, saying: "We don't want to end up in a halfway house in Europe, following not leading in a way that doesn't benefit business, doesn't deliver jobs and doesn't support Britain's growth."

The Deputy Prime Minister struck a cautiously optimistic note on the state of the economy but warned "we've still got a way to go".

He added: "As part of a global economy, we are never isolated from the economic realities of the rest of the world. But finally, I believe, we're turning a page on the mess we inherited."

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