By Elizabeth Piper
LONDON (Reuters) - Prime Minister David Cameron stood firm on Wednesday against eurosceptic members of his own party who criticised a plan to keep Britain in the European Union as a watered down "thin gruel" of broken promises.
The deal, presented by European Council President Donald Tusk on Tuesday, has so far received a warm response from European capitals which must approve it. But at home, it risks reopening a longstanding wound in Cameron's Conservative Party, beset by division over Europe for decades.
Bringing the package to parliament, the prime minister faced more than two hours of sometimes hostile questioning, mostly from established eurosceptic ruling party members who had already written off Cameron's renegotiation as a waste of time.
The first round of what is likely to be a months-long battle was less heated in parliament than in the mostly eurosceptic British press, which trashed the deal as a "farce", a "joke" or a "delusion".
With his cabinet ministers instructed not to pick sides until a deal with Brussels is final, Cameron faced criticism only from party "backbenchers" without government posts.
Nevertheless, the going could get tougher: former defence secretary Liam Fox, a leading eurosceptic Conservative backbencher, told BBC radio that up to five ministers in the prime minister's cabinet were certain to back leaving.
In parliament, Conservative eurosceptic Bill Cash asked: "Why has my right honourable friend, in order to stay in, bypassed so many promises and principles?"
Jacob Rees-Mogg, a lawmaker who had previously written off Cameron's demands as thin gruel, said: "The thin gruel has been further watered down."
He added: "My right honourable friend has a fortnight I think in which to salvage his reputation as a negotiator," referring to a summit of EU leaders on Feb. 18-19 which could pave the way for a membership referendum as early as in June.
Cameron replied to his "honourable friends" - parliamentary-speak for lawmakers from the same party - that the measures would ensure "that Britain truly can have the best of both worlds".
He now faces weeks of trying to persuade those wary of the EU that the deal will tackle the two most important issues for voters: migration and returning powers from Brussels to London.
Cameron has spent months trying to secure a deal so that he can campaign to stay in a reformed EU. He promised the referendum in 2013 to try to put to rest the divisive subject of Europe that dogged his Conservative predecessor John Major and brought down his hero, Margaret Thatcher.
The stakes are high. A vote to leave would not only transform Britain's future role in world trade and affairs but would also shake the EU, which has struggled to maintain unity over migration and financial crises, by ripping away its second-largest economy and one of its two main military powers.
Financial markets have largely welcomed the deal, but that optimism is also threatened by ongoing uncertainty. A Reuters poll of economists predicted the sterling currency would rise this year but the referendum was the main risk factor.
Cameron has heard warm words from other European capitals, with even eastern European countries, which had balked at measures to stop welfare payments to EU migrants, saying they were willing to study the deal.
At home, the prime minister may struggle to keep his party together. Cameron has said ministers will be free to campaign on either side of the referendum once a final deal is reached, but hopes that leading figures including members of his cabinet will follow his lead.
Some may hesitate to back an EU deal that so many in their party distrust. London's popular Mayor Boris Johnson, a potential Conservative successor to Cameron, strayed close to the line of dissent: "Most people looking at this will think that there is a lot more to do."
Oliver Daddow, an expert on British European policy at Nottingham Trent University, said Cameron now had to get a deal past other EU members - which may fear the deal could harm their countries' interests or cause a voter backlash against them - while dealing at home with a potential split in his party.
"Referendums in Britain are a political expedient, not a constitutional requirement," he said. "In this case, one has to ask whether the referendum itself was a politically wise move, seeing as it could tear apart the Conservative Party. Again."
(additional reporting by Kylie MacLellan and William James in London, Adrian Krajewski in Warsaw, Robin Emmott and Philip Blenkinsop in Brussels; editing by Peter Graff)