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Saturday, 5 January, 2002, 15:42 GMT
Poll 'will decide UK's euro future'
Euro Balloons in Spain
Speculation intensifies over timing of euro referendum
The people will decide whether Britain joins the euro when a referendum is held, Foreign Secretary Jack Straw has told the BBC.

Mr Straw strongly suggested he believed a referendum would go ahead but refused to be drawn on its timing.

There is no bullying here because the final decision is going to be made by the British people in an independent, proper referendum

Foreign Secretary Jack Straw
His comments come as the debate intensified over whether the decision that the UK should adopt the euro will be a political or economic one.

The foreign secretary told BBC Radio 4's Today programme: "The ultimate test will be made by individuals in the privacy of the polling booth because there is going to be a referendum on this."

Economic tests

"When the referendum takes place in part depends on when we are satisfied, if we are, that the five economic tests are themselves satisfied.

"There is no bullying here because the final decision is going to be made by the British people in an independent, proper referendum."

His comments come amid controversy over the reported opinion of the treasury spokesman in charge of assessing the economic case for the UK joining the euro.

Foreign Secretary Jack Straw
Mr Straw: Refused to be drawn on referendum timing
According to The Times, Gus O'Donnell said there could be no "clear and unambiguous" economic case for adopting it.

The decision ultimately would be a political, not economic one, he told economics students, according to Friday's paper.

The story was leaked to the paper by the Business for Sterling campaign.

A Treasury spokesman insisted on Friday that Mr O'Donnell did not recall saying this.

And he said the government remained committed to recommending the UK adopt the euro only if the five economic tests were met "clearly and unambiguously."

'Retain control'

But this has not stopped the Conservatives arguing that Labour's policy on the euro has been destroyed.

Euro introduced in Madrid
Twelve eurozone countries have adopted the euro

Shadow chancellor Michael Howard told Today it was now clear that holding a referendum was not simply a questions of economics.

"Now we know from the mouth of the man in charge of the assessment for the government that they [the economic advantages] won't be clear and unambiguous," he said.

He said the government should abandon its attempt to 'bully us into the euro' and focus on public services.

"We must retain control of our economy and control of our interest rates which should be set in the best interests of Britain".

'Inquiry considered'

Meanwhile it is being reported that the Treasury select committee may hold an inquiry into the basis of the technical assessment of the five economic tests.

Liberal Democrat MP David Laws told the Guardian: "I hope this week we will agree a timetable for an inquiry over the next few months."

Prime Minister Tony Blair has insisted that the five economic tests are crucial in deciding whether Britain joined the euro.

On his visit to South Asia on Thursday, he said: "Our position on the euro hasn't changed."

See also:

04 Jan 02 | Business
Profile of Gus O'Donnell
01 Jan 02 | UK Politics
Tories attack 'flawed' euro
05 Jul 01 | Business
Treasury doubts on the euro
01 Jan 02 | UK Confidential
Treasury's 1970 'euro' warning
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