Cameron on the sidelines during tumultuous day for world economy

By Ian Dunt

David Cameron was left on the sidelines today, as a dramatic day in Cannes and Athens saw the prospect of a referendum on the new eurozone deal fade away.

The meeting of G20 leaders in France took place in the shadow of events in Greece, where plans for a referendum had prompted Nicolas Sarkozy and Angela Merkel to openly contemplate the exit of the country from the eurozone for the first time.

In a day of rumour and contradictory reports, it eventually emerged that the referendum had been cancelled but that Greek prime minister George Papandreou would be staying in his post – at least until a confidence vote tomorrow.

"We are bearing a cross. We are being stoned," he told fellow parliamentarians this afternoon.

The developments came after a concerted rebellion by Cabinet secretaries, including the finance minister, who said EU membership "cannot depend on a referendum".

Britain was accused of holding a spectator status at the G20 meeting, after Mr Cameron and chancellor George Osborne made clear they would not be contributing to any Greek bailout or IMF support tailored for the single currency.

There is willingness to back an overall IMF fund increase however, to which Britain already contributes £29 billion – worth 4.5 % of the total package.

Even that move could prove problematic back home. The government barely survived a previous vote to hand more bailout money to the IMF and the increased confidence of eurosceptic Conservative backbenchers could see them team up with Labour to defeat the proposal.

Instead, Mr Cameron was busy batting away demands for a financial transaction tax and proposing a new regularised structure for G20 meetings.

The British government claims to support the principle of a tax on financial transactions – a version of which is promoted as a Robin Hood tax – but only if it is applied at an international level.

A private letter from Mr Osborne to bankers suggested that the chancellor would oppose the tax at any level, however.

Regardless of the Treasury's true view, Mr Cameron has been careful not to come out against the tax. Yesterday he said a piece by the Archbishop of Canterbury defending the idea spoke "for the whole country".

Australia, Canada and the US all oppose the tax, which was be proposed by Microsoft boss Bill Gates today, as a means of bulking up aid payments.

Mr Cameron is uniquely suspicious of that idea and yesterday warned the Commons of countries using the tax "as an excuse for getting off their aid commitments".

The prime minister also issued a paper to fellow world leaders calling for the G20 to be put on a more organised basis, taking on some of the roles of the annual G8 summit.

The paper called for a Financial Stability Board to be established as an independent entity to coordinate at the global level and a strengthened role for the World Trade Organisation.