Sackings warning over leaks

Two memos have warned the UK should join the euro

Downing Street has warned ministers they will be fired if they are found guilty of leaking documents pressuring the government to join the euro.

The blunt message came after leaks on two successive days - both of which warned of the dangers of staying out of the European single currency.

Labour are totally out of touch with Britain on the issue of the pound

Francis Maude

Prime Minister Tony Blair's spokesman Alistair Campbell said: "I am sending out a very strong signal: if we can pin down where these leaks have come from, that person will be dismissed."

Asked whether that included ministers, the spokesman replied: "Yes."

On Tuesday, it was revealed that the UK's ambassador to Japan had warned that foreign investment will be lost unless steps are taken towards adopting the euro.

The leaked message from Sir Stephen Gomersall said many Japanese investments in the UK had been affected by the high value of the pound to the euro.

The previous day, a leaked memo from the head of the Invest in Britain Bureau - part of the Department of Trade and Industry - warned of meltdown without government moves towards membership.

'Forcing the issue'

Mr Campbell said all leaks were deplorable, and that whoever was responsible for them would be dismissed.

Euro-sceptic businessman Lord Hanson suggested the two leaks might have been part of a deliberate exercise.

The suggestion that I instructed Sir Stephen Gomersall to doctor his reporting so that it could be leaked is an outrageous slur on a distinguished diplomat and on ministers

Robin Cook

"Ambassadors do as they are told by the Foreign Secretary," he said. "We all know that Robin Cook is desperate to force this issue ahead."

Foreign Secretary Robin Cook demanded an apology.

"The suggestion that I instructed Sir Stephen Gomersall to doctor his reporting so that it could be leaked is an outrageous slur on a distinguished diplomat and on ministers," he said.

Sir Stephen said that any backtracking on the timetable for euro membership could "trigger a much stronger move towards disinvestment" by Japanese firms.

'Orchestrated campaign'

But one senior Labour MP said: "It's clear there is a turf war going on between the Department of Trade and Industry, the Foreign Office and the Treasury over the euro."

Shadow foreign secretary Francis Maude said that despite the "carefully orchestrated" leaks, most British people did not want to join the single currency.

"Labour are totally out of touch with Britain on the issue of the pound - the only division within the cabinet is how loudly they should shout about their goal of dragging Britain into the single currency," he said.

"No amount of spinning and leaking by Blair's increasingly desperate sidekicks can disguise this fact."

And the anti-euro campaign group Business for Sterling attacked "an orchestrated campaign of leaks" from pro-euro ministers.

Business divided

But four major foreign investors in Britain have urged the government to make a clear commitment to the euro.

Top executives from Mitsubishi, NEC, Nestle, and Linde Hydraulics have warned that the high pound is making UK exports uncompetitive.

However, some business leaders dismissed the warnings in the leaked DTI memo as hysterical and scaremongering.

Meanwhile, new figures this week are expected to show foreign investment reaching record levels in the UK.