The Independent newspaper has obtained a tape recording of a lecture given by Mr Major at Harvard University in the US, in which he predicts Britain will join the euro.

Mr Major's comments could undermine Conservative leader William Hague, who is due to deliver an anti-Europe speech to his party's annual conference on Thursday.

Speaking to the BBC, shadow cabinet office minister Andrew Lansley said Mr Hague did not share the view that it was inevitable that Britain would sign up to the euro.

Following up Mr Major's remarks, his former deputy Michael Heseltine accused the Tory leader of trying to put the Conservatives on the road to withdrawal from the European Union.

Verbal onslaught

Mr Major, in his speech, predicted that Britain would not sign up to the euro within the next two years.

"But one day, if the euro is the success that it very well might be, then I think there will be an inevitability about our joining," the newspaper quotes him as saying.

He warned that Britain might lose out on investment projects if it remains outside the euro.

Mr Major said that if "the politics of reason" pointed to British entry, it would join - but not "with a glad heart", because it would involve a loss of economic decision-making power.

The Conservative Party has ruled out joining the single currency during this Parliament and the next.

On Thursday, Mr Lansley said it was not the party's view that signing up to the euro was an inevitability.

Andrew Lansley: "He may well be wrong"

He said: "William Hague's view is that it is not inevitable that Britain will join the euro.

"Britain is the fourth largest economy, we are capable of making a success of our own currency if we wish to."

Mr Major may also be wrong in his speculation about economic convergence, Mr Lansley continued.

He said: "I suspect that if he thinks the economic case will become evident for the euro in due course he may well be wrong because we don't see the necessary convergence inside the euro.

"We don't see the convergence between the euro countries and the UK.

"We don't see the benefits where the euro currency has been devaluing and not retaining its value as currencies are intended to do if they are to serve their economies well."

The Conservatives stepped up their verbal onslaught against the European Union at their conference on Wednesday.

Finance spokesman Francis Maude warned that joining the EU's single currency would devastate the British economy.

He said the UK's economy was aligned with that of North America, not Europe.

Former chancellor Ken Clarke hit back, attacking the party's official line that the single currency would lead to a European federal "superstate" with a European army.

His remarks signalled the collapse of a precarious truce between the leadership and the party's increasingly marginalised pro-Europeans.

Britain out

Speaking ahead of Mr Hague's speech, Michael Heseltine continued the debate on Britain's relations with Europe warning that his party was going down a dangerous path.

"The Eurosceptics have got a hidden agenda which is beginning to emerge which is called 'Britain out'," he told the BBC.