Nick Clegg has drawn battle lines for a fresh Commons showdown over the EU budget, insisting Tory backbenchers and Labour had to "grow up" and act in the national interest.

If the Government managed to agree a real-terms freeze in Brussels, MPs would face a stark choice between endorsing it or leaving the British taxpayer with an even bigger bill, the Deputy Prime Minister said.

The defiant comments came as Chancellor George Osborne tried to soothe the Conservative rank and file after a highly damaging parliamentary defeat on negotiation strategy on Wednesday night. Some 53 of the party's MPs joined forces with the Opposition to pass an amendment demanding a cut in the EU's seven-year funding package.

Mr Osborne admitted in an interview their frustrations were "understandable", and reiterated that David Cameron would strike a deal at the crunch European summit next month only if it was "good for the British taxpayer".

But Liberal Democrat leader Mr Clegg sounded a tougher note, flatly dismissing the possibility that a real-terms cut could be achieved. He said in an ideal world he would prefer a reduction in the EU budget, but the Government could not wave a "magic wand".

"I'm the Deputy Prime Minister of a Government that's unfortunately had to cut 20% of the policing budget. Of course, I would like to see less money go to the EU budget," he said in a question and answer session after a speech at Chatham House, but added: "It's what you think is the best possible deal rather than insist on an impossible deal."

Mr Clegg insisted the Government's position, calling for any rise to be inflation-only - currently around 2% - was "by far the toughest negotiating stance of any other member state". He suggested getting agreement on that from all 27 countries would be a major coup, and if that happened, Parliament would be asked to confront the "real hard choices".

The Prime Minister's official spokesman said: "What we saw yesterday was people expressing their view on the EU and the EU's budget and, from what I could see, those people were expressing views that weren't altogether surprising. We know that there are strong views about the EU budget."

On the negotiations with other EU countries over the budget, the spokesman said there were other countries that shared Britain's desire for restraint, but acknowledged: "There are very different positions around the table."

One of the rebels, Sarah Wollaston, insisted she still backed Mr Cameron and suggested she would support a deal as long as it was "the very best" he could secure. But rebel ringleader Mark Reckless said nothing less than a cut in the EU budget would win a vote in the Commons.