Liddell fears euro exclusion

Helen Liddell spoke to business leaders in Edinburgh

The Scottish Secretary, Helen Liddell, has told business leaders in Edinburgh that she is concerned about the consequences of not joining the euro.

The Chancellor, Gordon Brown, is expected to announce within the next few weeks that Britain is not ready to join the euro.

Before making her address, Mrs Liddell told BBC Radio Scotland: "The European Union is about to enlarge. Ten new countries are now sitting at the table.

"We could have a situation where we have a single market with 25 countries, 24 of them in one currency and one in another and I worry about the consequences of that for Scotland."

She also dismissed claims as "utterly bizarre" that she was attacking Mr Brown over the euro.

Reports at the weekend suggested she was being encouraged to do so by the prime minister.

'Balance of probability'

She said Tony Blair "didn't even know" she was making the speech at a business lunch organised by the Centre for Scottish Public Policy.

"Economics is not an exact science, it's all about the balance of probability," Mrs Liddell went on.

"But if you are trying to drive a wedge between me and the chancellor you are not going to succeed."

Mr Brown is due to announce by 7 June the results of his five economic tests on whether the British economy has converged sufficiently with that of the euro zone.

The debate on the euro is intensifying

Ms Liddell said her speech was "an extension of those five tests" by looking at the impact on jobs and inward investment if Britain did not join.

Ian Davidson, MP for Glasgow Pollok and chairman of Labour Against The Euro, said: "We support government policy more than some members of the Cabinet.

"Policy is to join the euro if the economics are right. The economics are wrong, but Mrs Liddell wants us to join anyway.

"The last thing Britain needs is a return to the days of the ERM and of boom and boost.

"How many job losses are a price worth paying for a political adventure?"

Leaders back euro

The pro-euro camp has received a boost with some of Britain's biggest companies and top business leaders signing a letter setting out their case.

The signatories include Sir Chris Gent, chief executive of Vodafone, Peter Sutherland, chairman of BP, and Lord Simon of Highbury, the former Treasury minister.

The letter, also backed by senior executives from Ford, Boeing and Siemens, says: "The working assumption of business has been Britain is a 'pre-entry' country.

"If it becomes apparent that this is no longer the case, the government must be aware that will constitute a significant change in the business climate of this country."

The business leaders say the conditions are right to join now and staying out of the eurozone would do lasting damage.

Their view is not representative of British industry as a whole.