David Cameron's commitment to an in/out referendum on Europe is bad for British business, Vince Cable will warn as he renews his attack on the Conservatives.
He says the Prime Minister's guarantee of a future vote on European Union membership has led to uncertainty and is hampering investment.
The Business Secretary will say he meets businesses daily who say they invest in Britain because of the access to the EU single market but if this cannot be guaranteed then they will look elsewhere.
Speaking in York at the opening of the Liberal Democrats spring conference, Mr Cable will say: "As much damage is also being caused by the Tories in their UKIP induced funk.
Nick Clegg and Nigel Farage are preparing for a public showdown "The possibility of a Tory government after the election and the uncertainty around a referendum in three years' time is creating a blight over the business investment which we desperately need to support recovery and jobs."
He will reiterate that the livelihoods of 3.5 million workers depends "directly on trade and investment links with the EU".
And he will also ask how Tory Eurosceptics and UKIP members plan to convince Scottish people to vote to stay part of the UK when they "indulge in British nationalism and Euro-separatism".
Mr Cable will insist that party leader Nick Clegg is right to fight UKIP's Nigel Farage on the "in/out" argument in a public debate.
It was announced this week those debates - on on radio, the other televised, will take place on March 26 and April 2, well ahead of the May 22 European Elections.
The Liberal Democrats are at risk of losing seats in the European Parliament in the May 22 elections - polling has given UKIP a lead over the party.
Mr Cable was fiercely critical of the Government's 'Go Home' Vans Party president Tim Farron will also use the conference to raise the issue of the European Elections, saying it was an in or out choice for voters, which meant either UKIP or the Lib Dems.
He will say voting Tory or Labour would be a "wasted vote" and will add: "You've got David Cameron sitting on the fence and Ed Miliband hiding behind his sofa."
Mr Cable is embroiled in an ongoing row with the Conservatives over immigration policy after claiming a rise in the number of migrants was "good news" for Britain.
Immigration minister James Brokenshire, who in a speech on Thursday blamed the middle classes for displacing Britons from jobs by hiring foreign workers, accused Mr Cable of being "incorrect" on the issue.
Mr Brokenshire's comments at the think-tank Demos, backfired when it transpired Mr Cameron, and a number of other ministers hired foreign staff.
:: Watch Sky News live on television, on Sky channel 501, Virgin Media channel 602, Freeview channel 82 and Freesat channel 202.
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