Former defence secretary Liam Fox has called on the UK to renegotiate its position with the EU (Reuters) Reuters

Former defence secretary Liam Fox has put pressure on David Cameron over the EU by calling for the UK to renegotiate its relationship with the EU.

Fox, who stepped down in 2011 after revelations about his professional relationship with his best man Adam Werrity, said it was time for the UK to set new boundaries in its relationship with the EU and consider dropping out if its demands cannot be met.

Although he announced that an "in or out" EU referendum was vital he added that it would be risky to call one now, as it could easily be defeated by a "short-sighted scare campaign".

Fox said that there remained strong resentment among the British public over Europe, as they feel cheated into voting for a relationship that they did not get.

"Worse, there is a suspicion that those who persuaded them to do so were all too aware of this deception," he added, claiming that it was time for the choice to be put back in the hands of the public.

"We've been told that we are winning the argument in Europe and that things are coming in our direction - this is simply not true."

New dynamic

Fox said: "I would like to see Britain negotiate a new relationship on the basis that, if we achieved it and our future relationship was economic rather than political, we would advocate acceptance in a referendum of this new dynamic.

"If, on the other hand, others would not accede to our requests for a rebalancing in the light of the response to the euro crisis, then we would recommend rejection and potential departure from the EU."

He argued that there was little to fear in a world outside the EU as globalisation would increasingly enable countries to cooperate more closely on the basis of functional commonality rather than geographical proximity.

"We have not moved the goalposts but they have been moved nevertheless and we must now respond," he added.

He said that the formation of the EU was mismanaged from the start while several countries that were previously behind the European project economically have "disappeared over the economic horizon".

"It was always a flawed project," he said, while claiming the fault lines that were highlighted by those who chose not to join the euro have cracked as expected.

Little Englanders

He said the euro was described as unsinkable, just like the Titanic, meaning "no-one thought about lifeboats".

Fox also said that the euro debate was flawed due to the misconception that those who were against it were characterised as giving the Little Englanders' response of considering it "too foreign".

"We must turn that perception on its head because actually the reverse is true," he added.

"Most of us believe that the problem with the European Union in an interdependent and sensitive global economy is that it's not foreign enough.

"There will be those who say that this is the wrong time and that it is politically difficult or even impossible. These are the perpetual arguments for inertia. This is not the time for party political games or tactical point-scoring.

"Our national interest is at stake and that trumps all other considerations. We must all rise to the challenge."

The prime minister will be sure to face more questions on the EU in the commons. He wrote an article in the Sunday Telegraph in which he said the UK needed to be absolutely clear about what its aims were before any action was taken.

Cameron wrote: "The two words 'Europe' and 'referendum' can go together, particularly if we really are proposing a change in how our country is governed, but let us get the people a real choice first."