A party that honours Latvia’s Waffen SS veterans was named among David Cameron’s new allies, as the Conservatives identified members of their anti- federalist group in the European Parliament.

One MEP from Latvia’s For Fatherland and Freedom Party (LNNK) will be among the 55 MEPs from eight countries in the European Conservatives and Reformists group, which the Tory leader pledged to form during his leadership campaign in 2005.

The Conservatives have been criticised by their own former MEPs for leaving the main centre-right European People’s Party (EPP) group of 264 MEPs in Strasbourg, distancing themselves from the parties of Nicolas Sarkozy and Angela Merkel.

William Hague, the Shadow Foreign Secretary, said yesterday that the party would still be able to work with parties that take a greater pro-EU stance when necessary.

“The separation from the EPP has been perfectly amicable, there will be a lot of good work with the EPP in the future,” Mr Hague said. “Now we have the new group it will grow strongly over the coming years and our view will be heard in the European Parliament much more clearly than before.”

The key principles of the new group will be free enterprise, the sovereign integrity of the nation state and probity in the EU institutions.

The 26 Conservative MEPs face an immediate loss of influence because it will be harder for a smaller group to secure committee chairmanships and other key posts in the European Parliament. In the last session, a Tory MEP chaired the important agriculture committee and another chaired the liaison group with the US Congress.

There has also been criticism for forming a link with 15 MEPs from Poland’s staunchly Catholic Law and Justice Party, which, like the Latvian party, has banned gay pride marches.

The Conservatives’ other main allies include nine MEPs from the ODS of Mirek Topolánek, the former Czech Prime Minister photographed naked at a party at Silvio Berlusconi’s villa. They also recruited one MEP each from a Christian party in the Netherlands, a nationalist Flemish party, a Finnish liberal and a Hungarian former finance minister.

Timothy Kirkhope, leader of the Tory MEPs, said that the new group would be the fourth-largest in the Parliament behind the EPP, the Centre Left (with at least 161 MEPs) and the liberal group (80 MEPs). It will be two seats ahead of the Greens, who are expecting 53 MEPs, although final figures have yet to be settled.

“We are very pleased and we hope to grow fairly quickly,” said Mr Kirkhope, who refused to allow openly xenophobic parties such as the Danish People’s Party or the Northern League from Italy to join.

He and the Latvian LNNK denied that it was in any way sympathetic to Nazism. “There was a commemoration of those who had served in the Waffen divisions of the Wehrmacht in the Second World War. The Labour Party has been churning this thing out over and over again,” Mr Kirkhope said.

“The truth of the matter is that attendance of the commemoration service for those who have died in wars is not just by members of LNNK — it is by others attached to the EPP because the Baltic states were taken over and oppressed by the Russians and the situation was that the Germans conscripted a number of people to join the Waffen.”

Roberts Zile, the Latvian MEP, said that war veterans were commemorated as patriots fighting against the Russians for a free country. “It is just some meetings of former soldiers, it is nothing to do with the SS,” he said. “They were soldiers taken into the German Army and they were not fighting for the SS, they were fighting for their dream of an independent Latvia.”

The full list of parties:

Belgium: Lijst Dedecker (LDD), one MEP

Czech Republic: Civic Democratic party (ODS), nine MEPs

Finland: the Centre party (Keskusta) sits in the Liberal (ALDE) group but one of its MEPs is now joining the Tories' new group

Hungary: Hungarian Democratic Forum (MDF), one MEP

Latvia: Latvian National Independence Movement (TB/LNNK), one MEP

Netherlands: Christian Union (Christen Unie), one MEP

Poland: Law and Justice (PiS), 15 MEPs

United Kingdom: Conservative Party, 26 MEPs (including an Ulster Unionist)

Times Recommends

• Fern Britton: 'I still can't see that I was wrong'
• Extreme cooking
• Easy French: Tarte Tatin