Britain outside the EU would be like North Korea, former Labour Prime Minister Gordon Brown has claimed. His comments come as the shadow Chancellor Ed Balls stands accused of having “lost his marbles” for painting an “apocalyptic” vision of life under the Tories.

Speaking to the Guardian, Mr Brown said that he would want to take a leading role in any Labour campaign on Britain’s EU membership. “We must tell the truth about the three million jobs, 25,000 companies, £200 billion of annual exports and the £450 billion of inward investment linked to Europe; and how the ‘Britzerland’ or Norwegian alternatives leave us subject to EU rules but denied a vote in shaping them,” he said.

“And we must talk about how the Hong Kong option — ‘leaving Europe to join the world’ — is really the North Korea option, out in the cold with few friends, no influence, little new trade and even less new investment.”

He added that it would be “sheer defeatism to cast ourselves, as sceptics do, as helpless victim, impotent bystanders unable to influence events. Our destiny is not a bit player on someone else’s stage, or a spectator hectoring from the wings, but always setting the agenda, bringing people together, and championing change.”

His words were echoed by shadow Foreign Secretary Douglas Alexander, who, in a piece for the Guardian’s Comment is Free section, opined: “This thesis of inevitable western decline has taken hold among Conservative backbenchers who seem resigned to Britain becoming increasingly diminished on the international stage. While Cameron has allowed his foreign policy to be driven by a desire to appease those within his own party who promote a little Britain – and in some cases little England – approach.

“In response to the twin challenges of a United States administration whose stated aim was a diplomatic pivot towards Asia, and a eurozone considering even greater consolidation, Cameron’s has chosen to isolate himself in Europe, even if it meant he himself became increasingly irrelevant in Washington.”

The bizarre, hyperbolic warnings come just as the shadow Chancellor Ed Balls has been accused of having “lost his marbles” for his suggestions that the Conservatives would cut four government departments, including the Foreign Office, in order to eliminate the budget deficit by 2017/18.

Mr Balls made the claim in a dossier, in which he wrote “The Foreign and Commonwealth Office, the Department for Work and Pensions and the Department of Transport would actually have no day-to-day budgets left at all while others such as DCLG [Department for Communities and Local Government] would almost cease to exist.

“The FCO budget is currently £1.2 billion a year. In this parliament it has had three per cent of the cuts to departments. Repeating this again based on £58 billion would mean a cut of £2 billion. The FCO would disappear.”

He predicted that the “cuts would be so extreme that they would lead to the smallest police force since comparable records began, the smallest army since Cromwell and over a third of older people receiving social care losing their entitlement to it”.

According to the Daily Mail, The 31 page dossier also painted an apocalyptic vision of life under the Conservatives in which police cuts led to a crime wave, a third of elderly people would have their state funded social care cancelled, and the NHS “as we know it” would cease to exist.

But when asked whether he really thought that the Conservatives would axe four government departments, he conceded “No I don’t think that.”

Conservative Party chairman Grant Shapps said “I think Balls has lost his marbles on this… That’s a sign of how chaotic Labour is.”