David Cameron has claimed a "spectacular success" in pegging a euro-budget rise next year to just 2.9%.
A dozen other countries backed the prime minister's EU summit initiative to declare the rise the maximum acceptable to the member states.
The alliance of 13 European countries, including France and Germany, is enough to block other EU leaders negotiating a bigger rise in forthcoming talks with the European Commission and European Parliament, both of which want a 6% increase for 2011 to fund the EU.
Mr Cameron originally wanted a budget freeze, in line with belt-tightening in national budgets.
But that was never a runner and the Prime Minister insisted that preventing a negotiation above 2.9% "made a real difference".
He shrugged off claims that his "breakthrough" was a rehash of a proposal by EU finance ministers three months ago to offer 2.9% as a negotiating compromise.
Far from it, claimed Mr Cameron, pointing out that the 13-way summit declaration went further by declaring: "These proposals (for a 6% rise) are especially unacceptable at a time when we are having to take difficult decisions at national level to control public expenditure. We are clear that we cannot accept any more than (2.9%)".
In other words, the 6% plan was now "dead", Mr Cameron told a summit press conference.
He went on: "Just as at home we inherited finances that were a complete mess, so too in Brussels we have inherited a budget deal completely out of touch with the situation we face across Europe. I believe that as a result of Britain's intervention the spotlight has now shifted to reining in the excesses of the EU budget.
"At a time when we are making painful decisions at home to put our economy back on track I will not allow Brussels to derail us."