I defy anybody to say how we can do anything about these obstructions, short of sending gun boats, except by discussions

Jack Straw Foreign Secretary

The foreign secretary said the talks offered the only opportunity to end to the Spanish "harassment" endured by Gibraltarians.

A deal with Spain could give the Rock's people more control over their lives and settle the long-running sovereignty dispute, he said, promising any sovereignty deal would have to be agreed in a referendum.

One of the sharpest exchanges in the Commons debate came when Mr Straw was challenged by Labour backbencher Louise Ellman.

Referendum questions

Ms Ellman spoke of Gibraltarians' deep hostility towards falling under Spanish sovereignty, shared or otherwise.

She asked: "Could the foreign secretary tell us what unpleasant circumstances and trick questions he is preparing for the referendum."

Mr Straw retorted that Ms Ellman "should not judge the government by her own standards".

Hoyle says the UK could be accused of "double standards"

The latest round of discussions between Spain and Britain over Gibraltar ended on Monday without agreement, although both countries said "good progress" had been made.

Gibraltar's Chief Minister, Peter Caruana, has refused to take part in the talks.

Mr Caruana says that even if the referendum vote rejects a deal, the plans will remain "on the table" as British policy and be a "sword of Damocles" for Gibraltar.

Shadow foreign secretary Michael Ancram argued Mr Straw was engaged in a "disingenuous process of sell-out".

Mr Ancram said the people of Gibraltar should have their say in a referendum vote before either Britain or Spain could claim an agreement had been reached.

Anything less would be a "dishonourable betrayal", said the Tory spokesman.

Spanish 'obstructions'

Mr Straw repeated his appeal for Mr Caruana to take part in the talks, which offered real benefits to the people of Gibraltar.

Senior Labour backbencher Gerald Kaufman, who trigged the debate, said the UK Government ought to be pleased Gibraltarians were so proud to be British they were ready to endure obstructions from Spain.

Lord Howe backed Straw's call for Gibraltar's ministers to join the talks

The foreign secretary replied: "I accept entirely there are all kinds of obstruction to their daily lives imposed by the government of Spain which should not be there.

"What I am trying to do is to do something about them and I defy anybody in this House to say how we can do anything about these obstructions, short of sending gun boats, except by discussions and dialogue with the government of Spain."

He also argued Gibraltar faced a different future in any case because of the impending end of its status as a tax haven.

Spanish foreign minister Josep Pique has said his country will never renounce its sovereignty claim over Gibraltar.

That stance was against "self-determination", said Labour MP Lindsay Hoyle.

Mr Hoyle argued there was a danger of the UK facing accusations of "double standards" when he promoted democracy elsewhere in the world but was ready to stop the rights of the people of Gibraltar.

'Anachronistic set up'

But Mr Straw insisted the referendum pledge he had delivered offered full self-determination.

The foreign secretary won support from Liberal Democrat foreign affairs spokesman Menzies Campbell, who said the referendum offered the greatest sovereignty possible.

Former Labour Europe Minister Doug Henderson called Gibraltar's constitution anachronistic in a modern Europe.

Businesses in the colony recognised that if there were not changes now, commerce would suffer in the future.

Meanwhile, in the House of Lords former Conservative Foreign Secretary Geoffrey Howe, who began the talks process in the 1980s, also urged Mr Caruana to join the negotiations.