Jeremy Corbyn has given his clearest indication yet that Labour will campaign in favour of continued European Union membership in the in/out referendum promised by David Cameron by the end of 2017.
Writing in the Financial Times (FT), the new Labour leader - who had been criticised for appearing to leave the door open for backing withdrawal - said: "Labour is clear that we should remain in the EU. But we too want to see reform."
While the party opposes reforms being sought by Mr Cameron that would reduce workers' rights, the shadow cabinet was in agreement that the answer was "not to leave the EU but to pledge to reverse those changes with a Labour government elected in 2020", Mr Corbyn said.
His comments came as Mr Cameron told business leaders that Labour would get "nowhere near power" under Corbyn's leadership.
Speaking at a business reception in London, the Prime Minister described the new Labour leader's support for higher taxes and nationalisation as a "throwback" to the 1980s, adding: "I think the British people have moved a long way from that.
"No-one wants to go back to those ideas."
But Conservative backbencher Zac Goldsmith warned Tories against complacency.
The Richmond Park MP - who is seeking the Tory nomination for London mayor - told LBC radio Corbyn could become PM in 2020 because of the "unpopular things" the Government would have to do over the next five years and the danger that the party would choose a "useless" leader when Mr Cameron steps down ahead of the election.
Meanwhile, Liberal Democrat leader Tim Farron raised the prospect of defections to his party, claiming he had received "unsolicited texts" from well-known Labour figures "distressed" about the direction Mr Corbyn was taking them.
Mr Farron told the Evening Standard: "The bottom line is ... people in the Labour Party need to understand they can have conversations with me, which may or may not be conclusive, which will remain totally between me and them."
The comments came after a millionaire donor offered to support MPs who want to break away from Labour.
Businessman and Hull City owner Assem Allam, who has donated £720,000 to Labour since 2010, said Mr Corbyn could not provide a "strong opposition" and warned the party could face three further election defeats.
Writing in the FT, Mr Corbyn said that workers' rights on paid holidays, working time protection and improved maternity and paternity leave, which were underpinned by EU legislation, were "under threat" in Mr Cameron's renegotiation of the terms of the UK's membership.
The Labour leader said: "There is a widely shared feeling that Europe is something of an exclusive club, rather than a democratic forum for social progress.
"Tearing up our rights at work would strengthen that view.
"Labour will oppose any attempt by the Conservative government to undermine rights at work -- whether in domestic or European legislation.
"Our shadow cabinet is also clear that the answer to any damaging changes that Mr Cameron brings back from his renegotiation is not to leave the EU but to pledge to reverse those changes with a Labour government elected in 2020."
He added: "Europe is the only forum in which we can address key challenges for our country, like climate change, terrorism, tax havens and, most recently, the mass movement of refugees from the violence in Syria seeking sanctuary and hope in Europe.
"We will not win friends and influence in Europe if we refuse to pull our weight.
"Labour wants to see change in Europe that delivers for Europe's people.
"We want to be better partners, and put our demands to make Europe better ...
"If Mr Cameron fails to deliver a good package or one that reduces the social gains we have previously won in Europe, he needs to understand that Labour will renegotiate to restore our rights and promote a socially progressive Europe."