Labour's Shadow Foreign Secretary Douglas Alexander has accused David Cameron of losing control of his party over Europe.
It follows reports that the Conservatives are considering publishing a draft bill which would guarantee a referendum on Britain's membership of the EU.
"This seems to be just the latest panicked response from the Prime Minister who is now following, rather than leading his backbenchers" Mr Alexander said.
"David Cameron is a Prime Minister who has both lost control of the agenda and lost control of his party."
"Labour have said that we don't think committing now to an in/out referendum up to four years from now is in the national interest because the priority must be getting growth into the economy not getting Britain out of Europe."
Cameron has pledged to back a Conservative MP's EU referendum bill, as Cable labelled the move potentially 'damaging' for the country.
114 Conservative backbenchers have voted in favour of a eurosceptic motion to amend the Queen's Speech in defiance of the Prime Minister.
David Cameron has denied he has buckled under pressure from his backbench MPs over the EU debate.