I will veto EU budget if necessary: Cameron

LONDON (REUTERS) - Prime Minister David Cameron said on Sunday he would use Britain's veto to scupper European Union budget talks if necessary, warning the 27-nation bloc it needed to learn to live within its means.

In an interview with the BBC, Mr Cameron warned that the 27-nation bloc it needed to learn to live within its means. He suggested the EU should split its budget into two - one for the euro zone and one for the countries outside the single currency, including Britain.

Mr Cameron, much to the delight of a powerful anti-EU wing of his Conservative Party, used the veto last year to keep Britain out of a European fiscal and economic pact aimed at resolving the euro zone debt crisis.

The prime minister also said Britain must find more spending cuts to reduce the budget deficit, after a return recession this year raised speculation the government was set to miss its own deficit reduction targets.