Tony Blair has been accused of "surrendering" part of Britain's annual £3.8bn EU rebate in an attempt to end Europe's budget crisis.
Mr Blair is expected to offer a reduction in return for cuts to spending on agriculture.
Tory leader Michael Howard said Mr Blair had "squandered" a "tremendous opportunity" to achieve reform.
Mr Blair said that not trying to reach a deal would be a "betrayal" of British and wider European interests.
'Move forward'
He added: "This has to be done on the basis of solidarity across the board...We are doing our best.
"It's important for Europe and each of our countries individually that we manage to get this budget position sorted out and we can move forward."
Tony Blair is a lame duck anxious about his political legacy
Daily Telegraph
UK press reaction
Britain's six-month EU presidency is set to end on 1 January and Mr Blair is keen to secure a budget deal before then.
He is said to be offering to reduce the overall European budget, reduce payments to the joining nations, and cut Britain's rebate in return.
The move follows the failure this summer to set an EU budget for 2007-13, with countries such as France and Ireland opposing plans to decrease funding for the Common Agricultural Policy (CAP).
'Mess'
Mr Howard said: "We are not going to get fundamental reform of the EU budget in the last days that remain of the British presidency.
"We could have had it, but we squandered a tremendous opportunity."
He said that after the European constitution had been rejected in referendums earlier this year, there should have been a debate about Europe's future.
He added: "We should have been talking about what we want the EU to do, about what the EU is for, and once you have decided what it should do and what it is for, then what it should cost and how you pay for its costs follow naturally from that decision.
"We never had the slightest attempt from the British government to take part in that debate or lead that debate and that's why we are in the mess that we are."
Conservative Europe spokesman Graham Brady said the suggestion of reducing the rebate was a "surrender", adding: "It is precisely what we were worried was going to happen all along."
'Keep money'
UK Independence Party leader Roger Knapman told BBC Radio 4's Today programme: "I can't think of anything that's likely to redeem this potential agreement. The rebate is set in stone.
"He doesn't have to reduce it, he doesn't have to amend it, he doesn't have to do anything except keep quiet and keep the money."
Liberal Democrat Treasury spokesman Vince Cable said: "There's a danger of getting the worst of all possible worlds - Britain gives up £1bn a year, the Eastern European countries get less money and there is no agreement to reform agriculture."
Mr Blair is in Budapest to meet leaders of Hungary, Poland, the Czech Republic and Slovakia in Budapest ahead of an EU summit in Brussels on 15 and 16 December.
Estonian prime minister Andrus Ansip has already described Mr Blair's proposal - which could see funding for accession states cut by up to 10% - as "unacceptable".
bbc.co.uk
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For the less politically minded members of the forum, could someone like RedSam or the like break this down a little?
Im a little confused as to what was trying to be achieved and what the net result is to UK Farming.
Edited 1 time(s). Last edit at 12/02/2005 12:43PM by Peat.