[A-List] UK eurozone membership

["Michael Keaney" <michael.keaney@xxxxxx>]

Treasury view rules out early euro poll

Campaign to shift public opinion likely to be launched next week

Patrick Wintour
Thursday June 5, 2003
The Guardian

The UK economy is no less convergent with that of the mainstream EU than the
economies of some states already in the euro and many about to join,
according to the Treasury assessment to be discussed by the cabinet today,
pro-euro ministers claim.

Nevertheless, Gordon Brown is set to announce on Monday that Britain's
failure to match its economy to that of the eurozone is the main reason that
only one out of the Treasury's five tests for euro membership has been
passed.

The need to first secure so-called economic convergence is said by sources
who have seen the Treasury assessment to be the central reason a referendum
in the short term is likely to be ruled out.

Supporting documents seen by the cabinet and to be made public as the
chancellor makes his statement point in particular to differences between
the housing market here and that in the rest of Europe.

However, according to a pro-euro source, the documents also make clear other
countries that have joined the euro, or are about to do so, have achieved
less convergence than Britain - leaving open the possibility of a referendum
in this parliament.

The reports come ahead of today's final cabinet discussion ahead of the
formal government announcement to MPs on Monday.

It is expected that Tony Blair and Mr Brown will hold a joint press
conference the following day to display their unity, and, according to
pro-euro sources, start a campaign to shift British public opinion towards
the euro. It will be taken as a sign that Mr Blair has not given up hope of
holding a referendum in this parliament if the economic circumstances are
right.

Pro-euro ministers remained pleased at the direction of the discussions, but
the Treasury has held the line that the assessment will clearly show Britain
has yet to converge with the EU economy.

Meanwhile, fears that a euro referendum in this parliament could spark a
civil war inside Labour were eased yesterday when a survey of party
constituency officers showed 70% support for campaigning in a euro
referendum.

The poll, done on behalf of euro advocates, also showed that 67.2 % of those
questioned opted for the view that Britain should definitely become a euro
member. Some 19.2% opted for the view that Britain should probably not
become a member of the euro, with the rider that they could be persuaded to
change their mind. A further 5.2 % said Britain should definitely not become
a member .

In a separate question, 79.9% said they would support the government if it
called a referendum this parliament. Asked if they would campaign in such a
euro referendum, 69.9 % said they would, with 18.8 % saying they would not.

Britain in Europe's campaign director, Simon Buckby, said: "A referendum
campaign would unite and energise the Labour party, not divide it."

Some 442 voluntary party constituency secretaries and chairmen or women from
different constituencies responded to the poll at the end of last month.
Critics will claim that such activists do not necessarily reflect opinion in
their party.

The survey did not ask if the officers actually wanted the cabinet to call a
referendum in this parliament. It was commissioned by Britain in Europe and
the Labour Movement for Europe, in conjunction with Labour MEPs, and
undertaken by the Campaign Company in association with PH Research of
Oldham.