Speak up for the euro, urges MP

The new currency appears to have been well received across the 12 nations

Peter Mandelson is urging ministers to back the euro, after the smooth launch of the single currency in the 12 eurozone nations.

Mr Mandelson predicted that Prime Minister Tony Blair would call a referendum on British entry before the next election, regardless of any hostile opinion polls.

Writing in the Financial Times, Mr Mandelson also predicts Chancellor Gordon Brown would not stop the prime minister going to the country over the issue if the circumstances were right.

Sterling suffered a record one-day fall against the fledgling currency on Wednesday, following the introduction of notes and coins in Europe on 1 January.

'Inevitable'

The Hartlepool MP wrote: "If an opening is created during the course of this Parliament, I believe he [Tony Blair] will wish to seize the chance and not wait for opinion polls to turn in favour."

He goes on to warn ministers against premature campaigning for British entry but calls on them to speak out on the issue.

He also praised Europe Minister Peter Hain who suggested entry could be inevitable.

In recent days, Foreign Secretary Jack Straw has been attempting to damp down speculation about a referendum and the idea that British entry was inevitable.

The prime minister has also faced claims his authority was being undermined through the conflicting signals sent out by ministers.

'Mixed messages'

Shadow chancellor Michael Howard said government policy on the single currency was "at sixes and sevens".

Mr Howard accused ministers of "playing games" on the issue, challenging them to call a referendum if they really believed entry was in Britain's interests.

Matthew Taylor MP, Liberal Democrat Treasury spokesman, added: "The longer the prime minister allows his ministers to promote conflicting messages on the euro, the more his authority will be undermined."

The UK, Sweden and Denmark are the only members of the EU not to join the monetary union.