Apparently this is an outgrowth of a pledge Cameron made during the 2005 Tory leadership campaign (about the only pledge he's ever made on anything?) that he would withdraw the Conservatives from the EPP grouping - to try to increase his support from the right of the party after the ludicrous (but at least honest) Liam Fox, who'd been standing on a hard right nationalist ticket, dropped out.
I guess you could give Dave some plaudits for consistency, but that's about it. How does allying the Tories in Europe with a bunch of politicians who would be operating under the BNP banner if based in the UK square with "progressive Conservativism"? I don't see any way that it can. The key question is: is Cameron just advocating this shift in Europe to honour his 2005 commitment, or is this a symptom of what his real agenda is. If the former, why on earth jeapordise his political credibility by jumping in bed with these nutters? If the latter, then we may find the allies of the BNP a lot closer to power than we'd like - partly as a result of Dave lending them credibility. Absolutely appalling.