Germany signalled its readiness yesterday to be “extremely helpful” to Prime Minister David Cameron in his quest to renegotiate Britain’s membership of the European Union.

Speaking before EU leaders debate Cameron’s EU reform demands today, Chancellor Angela Merkel called Britain a “natural ally” and described the benefits British membership brings to the bloc’s 28 members.

Cameron has promised to renegotiate Britain’s EU ties ahead of a membership referendum by the end of 2017. While he favours staying in a reformed EU, he has said he rules out nothing if he does not get the changes he wants.

She stressed Britain’s contribution to strengthening Europe’s internal market and promoting economic growth.

“As a permanent member of the United Nations Security Council, Great Britain contributes significantly to the European Union’s importance in the world,” she said.

Reaching a deal on the British question would be “very challenging”, Merkel added. But she said the EU had in the past addressed other countries’ issues in the bloc “and I am therefore confident we can do it this time”.

She said the core EU principles of free movement of people and non-discrimination between citizens could not be questioned.

“These principles are not up for negotiation,” Merkel declared to loud applause in the Bundestag, stressing that the details of the talks would be critical.

Limiting benefits available to EU migrants to Britain is the most contentious of Cameron’s demands.

A senior German official told a pre-summit briefing Berlin was ready to be “extremely helpful” to Cameron, but it was up to him to present his case.

Pressed on the benefits issue, the official said: “We have clear political guidance. We want Britain to stay in the EU. We can’t accept everything but we will do what we can to accommodate Mr. Cameron.”

A poll yesterday showed that British support for remaining in the EU would fall significantly if Cameron was unable to achieve safeguards for non-euro zone countries and curbs to welfare payments for migrants.

Some German government officials have stressed they cannot convince other European states, mainly eastern, to drop their opposition to Britain’s push for a four-year curb on welfare payments for EU migrants.

But they said they wanted Britain to play an active role in the EU.

“The UK must sit in the driver’s seat, and not next to it,” said another German official.