U.K. plans early vote on euro?

By Hasan Suroor

LONDON, SEPT. 1. As the European Central Bank on Thursday launched a high-profile campaign to promote the euro ahead of its introduction on the continent next January, the Blair Government was seen to be ``warming up'' to an early referendum on the future of the pound after the Europe Minister, Mr. Peter Hain said Britain's entry into single currency was inevitable.

In what commentators described as the most ``enthusiastic endorsement'' of the single currency by a Minister in recent months, Mr. Hain said: ``The euro is marching on and no one thinks that a decision can be postponed forever, apart from the right of the Tory Party.'' He called the euro a logical development of a single market and stressed that there was ``need for it''. He expected that the introduction of the euro in 12 European countries, including Germany and France, in January would generate its own momentum in Britain in favour of a single currency.

Mr. Hain's remarks, in an interview in the Left-wing magazine Tribune, were in contrast with his statement after joining the Foreign Office in June when he advised the pro-euro lobby to ``cool it'', prompting speculation that the Government was not yet ready to take the plunge in view of the widespread public hostility and strong opposition within the administration to the idea of scrapping the pound. His forceful support for single currency was welcomed by those who have been lobbying for an early referendum and The Guardian was quick to call it a ``warm up campaign''. Observers were also struck by the timing of Mr. Hain's statement which was seen to take advantage of the interest over the issue generated by the launch of a huge euro promotion campaign in Europe.

Indeed, he indicated that the Government would be watching very carefully the response of the British public to the euro once they started to handle it while on their visits to the continent. ``Next year is going to be very important as people will have new notes and coins in their wallets when they go abroad. Companies trading with Europe will start to deal in euros.

Some are already considering paying their British staff in euros, while shops are talking about displaying prices in euros,'' Mr. Hain said as newspapers reported that from January 1 several major British chain stores such as Marks and Spencer, Harrods and Dixons, would start accepting the euro. Most retailers are expected to start displaying prices in euro, even if they don't accept the currency immediately.

Mr. Hain's remarks are the latest twist in the confusing signals from the Government over the issue. While the Prime Minister, Mr. Tony Blair has consistently advocated Britain's fuller integration with Europe, his Chancellor, Mr. Gordon Brown favours a more cautious approach insisting that a referendum should be held only when the conditions for it are right. This is to be determined by a five-point economic test which he has devised. There is a strong euro-sceptic lobby within the Labour party and it is feared that a referendum, without sufficient groundwork, might divide the party. Besides, opinion polls have consistently indicated strong public distaste for the single currency.

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Section  : International
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