Brown spells out euro studies

The studies go alongside assessment of five tests

Four further studies on the potential impact of UK entry to the euro have been spelt out by Gordon Brown as the Treasury prepares to begin its assessment of the single currency.

The announcement fleshes out the detail of the 18 studies which will accompany the Treasury's verdict on the chancellor's five economic tests for joining the euro.

Brown must rule on the euro before June

Those on all sides of the euro debate are expecting a mountain of paperwork to be published when the Treasury rules on the five tests this year.

Mr Brown announced last year that the decision would come alongside 18 supporting studies. He fleshed out the detail of 14 of the reports then, and this new announcement fills in the gaps on the remaining four papers.

Two of the reports will assess exchange rate policy and the short-term economic impact of euro entry.

Hardening

Another will look at the framework of the five tests and the remaining study will be a collection of papers by international academics on the UK and the euro.

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The government must deliver its verdict on the five economic tests by June this year.

They examine the impact of euro entry on jobs, investment and the City, while crucially also assessing whether the UK's economy has converged sufficiently with the eurozone.

The Treasury says the 18 studies are part of the preliminary work as it embarks on assessing the five economic tests.

The chancellor on Sunday dismissed reports that he had ruled out euro entry, saying the assessment of the tests had yet to begin.

But some commentators have interpreted the 18 supporting studies as a hardening of Treasury reluctance to recommend euro entry.

Impact

If there was a positive ruling on the euro before June, a referendum on joining the currency could follow in the autumn.

But the feeling at Westminster is that the most likely scenario is that the government will say that the five tests have not been met and will be reassessed later this year.

That could lead to a referendum next year - though some believe the poll will not be held before the next general election.

In an interview with BBC News Online last month, former Labour leader Neil Kinnock said he believed a poll could even be held before the next election in 2005.

One of the chancellor's new studies - on the short-term impact of joining the euro - is being seen by some observers as particularly crucial.

They point out that the Treasury's chief economic adviser, Ed Balls, has already highlighted the importance of the potential short-term consequences of joining the euro.

Welcome

The supporting studies have been welcomed by both sides in the euro debate.

Simon Buckby, campaign director of Britain in Europe, said: "Pro-Europeans have everything to gain and nothing to lose from the most detailed possible economic assessment.

"Anti-Europeans should fear nothing more than an extremely rigorous assessment of Britain's national economic interest because it will expose that many of their arguments are based on emotion not reason.

"Britain is paying an ever higher price for our isolation from the euro - weaker trade, lower foreign investment, lost jobs."

A spokesman for the anti-euro No campaign, said: "It's good that the Treasury is doing the detailed work on the euro.

"If they take the assessment of the five tests seriously they will have to conclude they are not met.

"With 4.6 million people unemployed in Germany it's going to be hard to say the case for the euro is 'clear and unambiguous'."