Some of the UK's leading business figures are launching a campaign aimed at keeping Britain from joining the single European currency.

More than 100 business men and women have signed up to the campaign which also has the backing of Conservative leader William Hague.

They say that if the UK abolishes Sterling in the next century in favour of the Euro, Britain will become an 'off-shore' state of a federated Europe.

The UK would slowly lose its monetary policy and tax independence before finally seeing its political power drain away to Brussels, they warn.

Kalms: "political castration"

Key figures in the campaign include Sir John Banham, former director-general of the CBI, Sir Michael Edwardes, former chairman of British Leyland, and Sir Stanley Kalms, chairman of the electronics group Dixons.

Sir Stanley is on record as saying that joining up would lead to "economic and political castration".

The campaign launch in July aims to counter a publicity offensive run jointly by Whitehall and the European Commission to explain what European Monetary Union (EMU) would mean for the UK.

Sir Stanley said the European Commission's pro-Euro campaign had to be countered with proper arguments.

"I think we must make the argument clear to all those who are sceptical," said Sir Stanley. "We must put a strong alternative case.

"Moving into EMU will be disastrous for this country.

Sir Stanley Kalms tells Sue Cameron of BBC Radio Four's Today programme that the Euro will be a disaster (1' 15")

"We will immediately lose our monetary control. If we lose our monetary control, we will lose our fiscal control and if we lose that we will lose out political control.

"And then the UK becomes an off-shore part of Europe. A federated Europe is not on our agenda."

Sir Stanley criticised a recent CBI survey which claimed 72% of business leaders support EMU, saying it was unrepresentative.

"The CBI census was a shambles," he said. "We are trying to point out the dangers.

"If we win the case we will not go into the single currency. "We must put the case against a federal Europe."

Hague: backing campaign

The business leaders' campaign is organised by the European Research Group, headed by Tory MP Sir Michael Spicer.

Mr Hague's planned address to the campaign launch will also be seen as vital to the campaign's chances of success.

The speech will signify the Tory party's firm Euro-sceptical stance after rumours that the opposition leader was softening his position.

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