Tony Blair has ruled out a referendum on a new treaty to reform the European Union as ministers prepare for intense negotiations ahead of next week's EU summit.

Mr Blair had pledged to hold a referendum on the planned EU constitution in 2004 before the document was rejected by voters in France and Holland.

Yesterday No 10 insisted that the agreement expected to be sealed next week would lead only to an "amending treaty" that did not need to be approved at the polls.

But the Conservatives insisted that major reform of the EU should be approved by a referendum.

The German Chancellor Angela Merkel, who will chair the summit, is pressing for a deal which preserves much of the changes in the constitutional treaty, which floundered two years ago.

But Mr Blair's spokesman insisted: "This treaty should be an amending treaty. Previous amending treaties have not required a referendum and we do not believe that this treaty should have the characteristics of a constitution."

BERLIN (AFP) -- Spain is prepared to compromise to find an institutional treaty for the European Union but expects Poland to do the same, Prime Minister Jose Luis Rodriguez Zapatero said after talks here on Friday.

"Spain is ready to have a more flexible position so that we can make progress," Zapatero said after a meeting with German Chancellor Angela Merkel ahead of next week's crucial EU summit in Brussels.

Zapatero warned that isolation was not an option for Poland, which is bitterly opposed to proposed changes to the voting mechanism for the 27-country bloc.

"The message that I wish to send to our Polish friends is that we need to look ahead. I am sure that no country wants to stay on the sidelines and that no country will stay on the sidelines," Zapatero said.

He was the first of a host of EU leaders to hold discussions with Merkel over a three-day period as Germany -- which currently holds the EU presidency -- seeks to remove obstacles to its goal of putting the bloc on the road towards a new treaty to replace the rejected draft constitution.

"Zombie" GM crops - so called because farmers will have to pay biotech companies to bring seeds back from the dead - are being developed with British taxpayers' money.

The highly controversial development - part of a £3.4m EU research project - is bound to increase concerns about the modified crops and the devastating effect they could have on Third World farmers.

Environmentalists charge that it appears to be an attempt to get round a worldwide ban on a GM technology so abhorred that even Monsanto has said it will not use it.

The ban is on the so-called "terminator technology", which was designed to modify crops so that they produce only sterile seeds. This would force the 1.4 billion poor farmers who traditionally save seeds from one year's harvest to sow for the following one instead to buy new ones from biotech firms, swelling their profits but increasing poverty and hunger.

Since the ban was agreed under a UN treaty seven years ago, companies and pro-GM countries - including the United States and Britain - have pressed to have it overturned, so far without success. But the new technology promises to offer companies an even more profitable way of achieving dominance.

Zombie crops would also be engineered to produce sterile seed that could be brought back to life with the right treatment - almost certainly with a chemical sold by the company that markets the seed. Farmers would therefore have to pay out, not for new seeds, but to make the ones they saved viable.

Tony Blair agreed to commit British troops to battle in Iraq in the full knowledge that Washington had failed to make adequate preparations for the postwar reconstruction of the country.

In a devastating account of the chaotic preparations for the war, which comes as Blair enters his final full week in Downing Street, key No 10 aides and friends of Blair have revealed the Prime Minister repeatedly and unsuccessfully raised his concerns with the White House.

Article continues He also agreed to commit troops to the conflict even though President George Bush had personally said Britain could help 'some other way'.

The disclosures, in a two-part Channel 4 documentary about Blair's decade in Downing Street, will raise questions about Blair's public assurances at the time of the war in 2003 that he was satisfied with the post-war planning. In one of the most significant interviews in the programme, Peter Mandelson says that the Prime Minister knew the preparations were inadequate but said he was powerless to do more.

'Obviously more attention should have been paid to what happened after, to the planning and what we would do once Saddam had been toppled,' Mandelson tells The Observer's chief political commentator, Andrew Rawnsley, who presents the documentary.

President Nicolas Sarkozy may have won a majority in yesterday's legislative elections, but he is far from winning his battle to reform France.

In particular, he will have to tread carefully with France's unions. Union membership may be low by European standards at 8 per cent, but the French passion for street protest gives organised labour far wider public support in the face of potentially unpopular reforms. This week the right of centre government will present a draft law to the powerful unions on minimum service in public transport in the event of strikes, the first in a series of economic and social reforms Mr Sarkozy is determined to push through this summer.

In the first weeks of his mandate Mr Sarkozy won a cautious welcome from union leaders with reassurances that they would be involved in shaping reform. But now signs of unease are beginning to emerge.

University unions called yesterday for a slowdown in plans to link next year's budget to reform of the country's stagnating third level education system. And 10 days ago three of the biggest general unions buried traditional differences to reproach the government for having barely consulted them on a draft law for tax-free overtime.

German Chancellor Angela Merkel has said there were still serious problems with Poland over voting rights before crucial talks on a new EU treaty.

Germany, the current holder of the EU presidency, wants states to agree to a road map for a new constitution at next week's summit in Brussels.

Mr Kaczynski has threatened to veto any deal reducing Poland's voting rights.

Czech Prime Minister Mirek Topolanek said he backed Poland's position after meeting Mrs Merkel on Sunday.

Only the Czech Republic supports Poland on the issue.

Members of a newly-formed German political party resulting from the merger of two left-wing groupings called for reviving the social state on Saturday, during their first conference.

The Party of Democratic Socialism (PDS), which is the successor organization to the East German Communist party, and a group of disgruntled former Social Democrats and trade unionists, known as Electoral Alternative for Work and Justice (WASG), agreed on Saturday to name the new organization The Left.

They elected as co-chairmen Oskar Lafontaine, a former Social Democratic party leader and federal finance minister, and Lothar Bisky from the PDS.

"We are the only party which challenges the (capitalist) system," Lafontaine told delegates. "We want to reintroduce the social state."

Although the party's name is nominally new, traditions and rituals within Germany's Left party will stay the same. The Internationale -- the hymn of the worldwide workers' movement -- as well as the term comrade, with which Left party members still proudly address one another, betray the party's strong roots in the socialist ideology of the previous century.

The EU's foreign policy chief has said it will resume direct economic aid to the Palestinian Authority in support of President Mahmoud Abbas's new cabinet.

Mr Abbas appointed an emergency cabinet excluding Islamists Hamas, who won the 2006 parliamentary election, after it seized control of the Gaza Strip.

Javier Solana said a part of the money would go directly to the government, but also that some would go to Gaza.

Not a lot of details on this yet.

Gazprom Faces Asset Sale Under EU's Energy Plan (WSJ)

TALLINN, Estonia -- The European Union's antitrust chief on Friday said Russian natural-gas monopoly OAO Gazprom would have to sell its distribution assets in Eastern Europe if a plan to overhaul the energy industry is approved.

Under the plan, which was unveiled in January, the EU would force energy companies to separate production and distribution units as a means of increasing competition.

"This also applies to Gazprom -- they cannot fulfill both roles," the EU's competition commissioner, Neelie Kroes, said. "Gazprom cannot own the distribution network of countries to which it supplies natural gas. They have to separate their activities."

(...)

Gazprom, which is majority owned by the Russian state, produces all its energy in Russia but owns several distribution companies in Eastern Europe, including 37% of Estonia's Eesti Gaas, 34% of Latvijas Gaze in Latvia and 37.1% of Lithuania's Lietuvos Dujos.