Parties trade Europe blows

Labour leader Tony Blair has made his strongest attack yet over Europe, warning the Tories would put the UK "a step away" from withdrawal from the EU.

In a major speech to party activists in Scotland, he insisted "patriotic" Britons should play a full part in the union.

You can vote Labour or Liberal to scrap the pound. Or you can vote Conservative to keep the pound

Tory leader William Hague

Retreating into isolationism would costs thousands of jobs in the UK, he warned.

Conservative leader William Hague lost no time hitting back, telling a rally in Manchester that there were "two weeks to save the pound".

The prime minister again pledged that the UK would only join the euro if the public backed it in a referendum.

"Isolation and marginalism in Europe is not patriotic, but the denial of our true national interest," he told his audience at the St Bride's community centre in Edinburgh.

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The Conservative plan to renegotiate the terms of European treaties was "playing with fire", said Mr Blair.

He added: "It is a step away from leaving Europe and that would be disaster for Britain, for British jobs, for British industry and influence in the world."

But Mr Hague said that a Labour victory on 7 June would mean that the process of joining the euro would begin on 8 June.

"That is the decision we face in two weeks' time. We have two weeks to save the pound," he said.

"Two weeks to decide whether, from June 8, our economy should be run in our own interest."

"You can vote Labour or Liberal to scrap the pound. Or you can vote Conservative to keep the pound."

Earlier the Liberal Democrats put their case for Europe - Treasury spokesman Matthew Taylor said euro-zone countries had done well from the single currency while British industry had suffered.

Humiliation

He warned that this stance on Europe was not patrotism but folly and would lead to the humiliation of Britain.

And he said Britain's roots in Europe were long established.

On the single currency, he said: "We will recommend joining the single currency if it is in our national economic interest and it is you the British people who will have the decision in your hands in a referendum."

Isolation and marginalism in Europe is not patriotic, but the denial of our true national interest

Tony Blair

At Labour's morning news conference, Chancellor Gordon Brown appeared to back the prime minister's positive view of the government's chances in a euro referendum, though he insisted policy had not changed.

"We have always said that if the five economic tests were met and a recommendation was made by the cabinet and parliament, we believe the people would support it, but in the end it is up to the people," he said.

'Huge experiment'

Just before Mr Hague made his speech, shadow chancellor Michael Portillo addressed supporters in his London constituency and called for a Europe of nation states.

He insisted it was not a choice of entering the euro or leaving Europe as Labour would have the electorate believe.

He said the single currency, was a "huge experiment".

"There is no precedent for single currency," he said

Meanwhile, the UK Independence Party held a rally in central London calling for a full withdrawal from the EU.

The rally was addressed by Eurosceptic millionaire Paul Sykes who is bankrolling the campaign to the tune of £100,000 a day.