The Foreign Secretary has announced a government review of all EU legislation which affects UK citizens with the aim of better assessing our relationship with the European Union amid a rapidly changing legal landscape.
The structure of the EU has been shaken to its very foundations in recent months as the crisis in Greece and other vulnerable economies such as Italy and Spain have called the entire Union into question.
EU leaders have responded to the crisis by proposing much greater fiscal union than has ever been seen before, in a bid to shore up the system and prevent a repeat.
The UK, which sits outside the Eurozone, has found itself isolated in its opposition of some key reforms and leading the way in demanding greater legislation in other areas such as the implementation of Basel 3 capitalisation requirements.
Now the Government wants to scrutinise all EU Law which affects UK citizens, in a move which Mr Hague described as a "necessary and positive part of reforming Europe".
The proposed audit will take up to two years to complete and should be ready by 2014. Labour claim that this is too slow and that an urgent strategy was needed to cope with the proposed greater integration of other EU member states, before the EU summit to discuss the matter in December this year.
"The truth is that Britain urgently needs an effective Europe strategy, and an audit, while worthwhile, is not a substitute for a strategy," said Douglas Alexander, Mr Hague's counterpart.
Mr Hague, however, identified a different purpose for the audit, inviting businesses, NGOs and devolved administrations to participate to ensure that the true extent of the UK's relationship with the EU is unmasked.
"We must take the opportunities for Britain to shape its relationship with Europe in ways that advance our national interest in free trade, open markets and co-operation," Mr Hague told the Commons last week.
"That should involve less cost, less bureaucracy and less meddling in the issues that belong to nation states," he added.