BBC News with Iain Purdon

The European Union has decided to

press ahead

without Britain with a plan to forge a tighter fiscal union. The plan is to sign a pact by March if national parliaments agree. The British Prime Minister David Cameron was the only one of the 27 EU leaders to refuse to take part. From Brussels, here's Andrew Walker.

The core of what the summit agreed was a system of tougher

discipline

over government finances. The deal has been accepted by the 17 countries that use the euro and six others. Three of the remaining leaders will consult their parliaments, so Britain could end up completely isolated. Those who do take part will accept new limits on borrowing and face possible sanctions if they break the rules. They also agreed measures to increase the funds available for bailouts of struggling governments. It'll be done as an agreement between the countries that want to participate. Some, including the German leader Angela Merkel, would have preferred amendments to EU treaties, which require all governments to agree. But David Cameron wanted some

guarantees

about the regulation of financial services, which he was unable to get.

Mr Cameron says he acted in Britain's national interest by refusing to sign up to the new EU treaty, but he admitted that Britain's relationship with Europe had now changed.

"I think I did the right thing for Britain. We were offered a treaty that didn't have proper