The UK should attempt to reopen negotiations with Spain aimed at sharing Gibraltar's sovereignty, a former minister has suggested amid continued tensions over the Rock.
Peter Hain, who led negotiations aimed at resolving the situation while a minister in Tony Blair's government, said a sovereignty deal would end the current difficulties being faced by Gibraltarians in the dispute with their Spanish neighbours.
The Government has insisted there will be no compromise over the sovereignty of Gibraltar, and Foreign Secretary William has vowed to stand "shoulder to shoulder" with its citizens in response to heightened pressure and increasingly belligerent rhetoric from Madrid.
A deal on ending the dispute, which dates back to the Treaty of Utrecht 300 years ago that ceded the territory to Britain, appeared close in 2002 after negotiations between then Europe minister Mr Hain and his Spanish counterpart.
Mr Hain told the BBC Radio 4 Today programme that the Spanish got "cold feet" and backed off.
"There was a historic opportunity to have joint sovereignty which would have protected Gibraltarians' way of life - they could remain British citizens, but it also recognised Spain's historic claim at the root of this," he said.
"I think we need to revisit those whole negotiations."
The Labour former minister added that a deal would have "transformed life for Gibraltarians" as "there would have been an open border, they would have had aeroplane access, telephone access, all the things which are bedeviling them at the moment".
Mr Hain's comments are likely to be met with hostility in Gibraltar, where citizens overwhelmingly rejected the prospect of a shared sovereignty deal in a referendum in 2002.
Relations between Gibraltar and Spain have deteriorated in recent months in a row over fishing grounds, with Spanish ministers raising the prospect of imposing a 50 euro (£43) levy on vehicles crossing the border and the possibility of closing airspace.
Spanish foreign minister Jose Garcia-Margallo said the proceeds of a border fee could be used to help Spanish fishermen who have lost out because of damage to fishing grounds allegedly caused by Gibraltarian authorities following the creation of an artificial reef.
Gibraltar's chief minister, Fabian Picardo, accused Madrid of "sabre-rattling" and behaving like North Korea.
The Foreign Secretary offered his support to Mr Picardo and emphasised that the UK "stands shoulder to shoulder with the people of Gibraltar" at a time of "increasing Spanish pressure and rhetoric".
He said: "I also highlighted that we will respect Gibraltar's 2006 constitution and the commitments the UK has repeatedly made not to compromise on British sovereignty over Gibraltar.
"We discussed the need for a political solution to the current tension with Spain, which would be firmly in the interests of communities on both sides of Gibraltar's border with Spain."
European Commission (EC) spokesman Frederic Vincent confirmed that controls on the Spain-Gibraltar border are allowed because the latter is not included in the Schengen Borders Agreement, which permits people to travel freely within the Schengen area of 26 countries.
Mr Vincent said these controls or sanctions must be "proportionate" and the EC is studying the legality of Madrid's threat to impose a fee to cross the border between the two countries.
The matter will be discussed at a future EC meeting, the spokesman said.
Mr Cameron's spokesman said the potential levy by Spain had not been raised directly with the British Government.
At a regular briefing for journalists in Westminster, the Prime Minister's spokesman said: "Clearly, we remain seriously concerned by the events at the Spain/Gibraltar border.
"Specifically on this issue of border fees, the Spanish have not raised the prospect of introducing border fees with us. We are seeking an explanation from them regarding reports that they might target Gibraltar with further measures."
The Foreign Office has made clear that the UK expects Madrid to live up to the commitments it made in the 2006 Cordoba Agreement, which included deals on issues like border crossings and access for flights, as well as establishing a tripartite forum for regular dialogue between Britain, Spain and Gibraltar.
UK Independence Party (Ukip) leader Nigel Farage called for Britain to strengthen ties with Gibraltar.
"I think now we have reached the point where the British Government needs to say, very firmly, there was a referendum in Gibraltar a couple of years ago, 99% of the people of Gibraltar wish to remain part of Britain," he told ITV's Daybreak.
"What I want to see is us saying to Gibraltar 'Right, let's integrate you more deeply in the UK, let's give you your own Member of Parliament in Westminster' and let's send Spain the message 'We are not going to negotiate'."Suggest a correction