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Lord Lawson has become the most senior Tory figure to call for the UK to quit the European Union - pledging to vote "No" in any referendum on membership.
In a move that piles further pressure on David Cameron over the issue, the former chancellor warned his proposed renegotiation would only secure "inconsequential" concessions from Brussels.
Writing in The Times, he said there was now a "clear" case for withdrawal, insisting the economic benefits would "substantially outweigh the costs", in contrast to the Prime Minister's position.
His intervention is sure to further embolden eurosceptic MPs demanding a tougher line to halt the rise of Nigel Farage's rampant anti-EU UK Independence Party (UKIP).
Mr Cameron is already under pressure to hold a "mandate referendum" as early as next spring to seek public approval of his strategy of putting a renegotiated settlement to an in/out vote by 2017.
In the wake of UKIP's surge in last week's county council elections, there is also pressure to put the strategy to a vote in the Commons in defiance of his Liberal Democrat coalition partners.
Lord Lawson, who was Margaret Thatcher's longest-serving chancellor and remains a highly respected figure within the party, said that it was "by no means assured" that Mr Cameron would win the 2015 general election.
But he said he believed public demand was such that a referendum would have to happen under Labour in any case.
Dismissing the chances of either party securing significant reforms, he said Brussels would fear a "general unravelling" as other countries sought to match the return of powers.
"But all this is largely beside the point," he wrote.
"The heart of the matter is that the very nature of the European Union, and of this country's relationship with it, has fundamentally changed after the coming into being of the European monetary union and the creation of the eurozone, of which - quite rightly - we are not a part.
"That is why, while I voted 'in' in 1975, I shall be voting 'out' in 2017.
"Not only do our interests increasingly differ from those of the eurozone members but, while never 'at the heart of Europe' (as our political leaders have from time to time foolishly claimed), we are now becoming increasingly marginalised as we are doomed to being consistently outvoted by the eurozone bloc.
"So the case for exit is clear."
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