Key euro role seen as peace offering to the UK

Naming Lord Hill to a brief including banks and the integration of EU capital markets was widely seen as a gesture to Prime Minister David Cameron, a vocal critic of Mr Juncker and his support for a powerful Brussels that Mr Cameron says could push Britons to vote to quit the European Union.

Pierre Moscovici, the nominee of French President Francois Hollande and a proponent of public spending to boost eurozone growth, will run economic and monetary affairs.

In a surprise move, Mr Cameron’s Conservative Lord Hill, a former public relations consultant and Leader of the House of Lords who is little known even in London, was given a revamped portfolio entitled Financial Stability, Financial Services and Capital Markets Union. He will be in charge of relations with the European Banking Authority.

One analyst described his job as “a major peace offering” by Mr Juncker to Mr Cameron, who welcomed the appointment as showing that efforts to create a banking union was not the sole preserve of countries using the euro currency.

Britain has feared eurozone efforts to regulate financial markets to guard against new crises could hurt the City of London’s dominance as a banking centre.

Keeping Britain in the bloc is a major goal for EU leaders in the face of Mr Cameron’s demands for Brussels to devolve powers and plan for a 2017 referendum on continued British membership.

Responding to yesterday’s announcement, the Confederation of British Industry said: “Lord Hill must work hard to cement alliances in Europe, making the UK’s case in Brussels while also selling the benefits of the EU in the UK.”