In this report the Committee agree with the Government that the optimum outcome from the December European Council meeting would have been an agreement on a new treaty to deal with the crisis signed by all Member States that protected UK interests. As this did not happen, the Committee express regret that the Government has not published its safeguards the Prime Minister sought at the December Council and call on them to do so. The Committee states that there is a risk that the shift of discussion from the main EU Channels to forums where the UK has no voice risks marginalising the UK’s influence in Europe over time. In the Committee’s view the UK, the other Member States, and the EU institutions must find a way to secure fiscal integration for the euro area states while at the same time protecting the integrity of the single market as an engine of economic growth for all 27 member states of the EU. The proposed treaty raises a number of legal issues, which the Committee examines in detail. The Committee also considered the role of the European Central Bank following its role in refinancing European banks and state that further intervention is likely to be necessary to preserve the functioning of credit markets within the EU. The Committee call on euro area states to decide whether the introduction of ‘Eurobonds’ will be necessary