Tony Blair is facing a fresh test over his policy towards the euro after it was battered by a series of setbacks.

Just days after trade secretary Steven Byers was wheeled out to underline the government's commitment to the single currency, a new poll showed nearly 70% of voters are opposed to Britain joining.

The survey came on the heels of the statement by the head of the European Central Bank, Wim Duisenberg, that the UK was "many years" away from joining.

Meanwhile Digby Jones, director general of the Confederation of British Industry, announced that the group will no longer put the case for joining the currency until the government actually launches a referendum campaign.

The series of blows has added to the pressure on Tony Blair to engage in a powerful campaign designed to persuade people of the benefits of joining the single currency - or to change policy.

Anti-euro newspapers - including the symbolically crucial, for Labour, Sun - have seized on the Duisenberg comments to claim the euro is now officially dead as far as Britain is concerned.

And that will make disturbing reading for the prime minister who is desperate to see the Rupert Murdoch-owned paper back him at the next election.

Meet tests

The government's official line is to hold a referendum early in the next parliament, assuming Labour wins that poll and that the UK economy has met certain tests.

But there have been growing signs that, with public opposition to the euro strengthening, the prime minister is eager to damp down the entire issue.

William Hague believes it is one of the biggest policies differentiating Labour from the Tories - who are committed to ruling out joining the currency for the lifetime of the next parliament.

He will make it the central plank of his election platform while Mr Blair will be eager to keep the campaign focussing on other issues where he believes he has guaranteed public support.

Cabinet strains

But there are persistent strains within the cabinet over the policy, with Foreign Secretary Robin Cook leading the charge in favour of the euro and Chancellor Gordon Brown urging caution.

Many ministers believe there is enough flexibility in the existing policy to ensure the government is not forced into anything which runs against the public mood.

But some fear that flexibility has led to confusion, with different ministers sending out different signals.

Mr Byers' speech was supposed to put an end to that confusion, but markedly failed to do so by simply restating the old "prepare and decide" formula.

The latest developments have again pitched the policy to the top of the political agenda, where William Hague wants to keep it.

The prime minister will now face a growing chorus for him to take positive action and either announce that, like Mr Duisenberg, the government does not envisage Britain joining the euro "for many years" - or to come out fighting in favour of the currency.