Aznar in London for Gibraltar Talks

The prime minister, Tony Blair, and his Spanish counterpart, Jose Maria Aznar, will today meet in Downing Street for "difficult" talks on the future of Gibraltar.

The government has a self-imposed mid-summer deadline for resolving the long running dispute between London and Madrid over the rock but negotiations have run into trouble.

Spain is reluctant to give up its historic claim to eventual full sovereignty and opposes putting a deal on shared sovereignty to Gibraltar's inhabitants in a referendum.

It fears that a massive "no" vote in the colony, as is widely expected after a mass protest in March, would knock sovereignty off the agenda for a long time.

The foreign secretary, Jack Straw, today repeated Britain's insistence on a referendum.

"That was a solemn undertaking given in 1969 to the people of Gibraltar. We absolutely stand by it," he told the Radio 4 Today programme.

Britain has also refused to allow Spain joint control of the Gibraltar military base.

Their meeting comes after a poll showed 75% of MPs believed Gibraltar's inhabitants, who oppose the negotiations, should be left alone to decide their own future.

Mr Straw said that if a deal were reached with Spain the government would then enter into talks with Gibraltar's inhabitants before the agreement was put to a vote.

"That is why in order to make life better for the people of Gibraltar, paradoxically to give them more control over their own lives and far less interference from Spain, we need this process of calm negotiation followed by a long period of deliberation by the people of Gibraltar," he said.

The two governments acknowledged "real differences" after the last round of negotiations involving Mr Straw, and Josep Pique, his opposite number in Madrid.

The shadow foreign secretary, Michael Ancram, said today in a statement: "The discussions will end in confrontation with either the people of Gibraltar or the Spanish government.

"The government should suspend the talks on sovereignty immediately and think again about resuming them on matters where agreement can be reached rather than on matters where it cannot."

Mr Blair's official spokesman last night suggested such difficulties were inevitable as the self-imposed deadline approached.

"Tomorrow is not make or break," he said.

"As negotiations like this go on you do get to the difficult point and we are at that point at the moment."