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Wednesday, 11 September, 2002, 16:24 GMT 17:24 UK
TUC's euro hesitation

The government narrowly escaped defeat over the euro issue at the TUC in Blackpool.

But the trade unions are growing increasingly sceptical of Tony Blair's stance on the euro, despite pleas from TUC general secretary John Monks.

Two of the three largest unions in the TUC, Unison and the T&G, now oppose early entry into the euro and want to delay any decision until well into the next Parliament.

And the newly elected leader of the giant engineering union Amicus, Derek Simpson, has said that he doesn't believe there has been a genuine debate on the issue.

The change in position by Bill Morris, leader of the T&G, is particularly significant, as he is beleived to be close to the Chancellor, Gordon Brown.

Although the conference beat off attempts to reject the TUC statement on the euro, that statement itself is a careful compromise, incorporating widely differing views.

As John Edmunds, boss of the GMB said, it was backed both by eurosceptics and euroenthusiasts, and by both those who wanted to accelerate euro entry and those who wanted to delay.

But what is most clear is that, like the rest of the country unions are confused and unsure about where they stand on the arguments for and against the single currency.

Internal splits

Derek Simpson's remarks have annoyed his fellow joint general secretary, Roger Lyons, who told BBC News Online that Amicus had unanimously backed the TUC General Council resolution calling for an accelerated timetable for considering euro membership.

Bill Morris of the T&G is in favour of the single currency in principle, but just differs on tactics, wanting to postpone a referendum so that the government can concentrate on improving public services in order to ensure its election to a third term.

And Unison voted both for the TUC general council motion and against their statement.

Public sector worries

The main division within the unions, however, is between the public sector unions and those who represent manufacturing industry.

Manufacturing unions have long believed that euro membership would boost exports to the eurozone and promote inward investment into the UK. The main reason that the public unions are worried about the euro is the fear that tough eurozone rules designed to keep inflation low (the stability and growth pact) would result in restrictions on public spending.

Gordon Brown has already clashed with the European Commission and the ECB on the interpretation of these rules in Britain, and some union speakers claimed that under the euro's rules, he would have to cut spending by 10bn 20bn.

Unison is therefore at the forefront of those unions against euro membership.

Euro prices

Another worry for the unions is the fear that the introduction of the euro has led to higher prices in the eurozone.

Bill Morris of the T&G said that his union would insist on bargaining deals that took account of euro price rises if the UK did join the euro.

Given that the Treasury brought out its own document on Friday adding the examination of prices to its own investigations of the five tests, this looks suspiciously like coordination.

It may well be that the government itself is beginning to consider how to delay the referendum until it is more certain it could win.

In that case, the TUC's confusion could prove helpful after all.


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06 Sep 02 | Politics
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