THE British government agreed to adopt a tougher stance against Europe yesterday and announced it was very unlikely that Britain would join a single currency in January 1999.
In an attempt to prevent the Conservative Party tearing itself apart over the issue in the run up to the general election, the British Prime Minister, Mr John Major, adopted his strongest stance yet on the single currency, following an "intense" cabinet debate.
As the Euro sceptics cheered, Mr Major told the House of Commons: "We have concluded, on the basis of that detailed examination of the criteria and information currently available, that it is very unlikely, though not impossible, for the single currency itself to proceed on January 1st, 1999.
"If it did proceed without reliable convergence, we would not, of course, be part of it."
But Mr Major refused to answer whether he still agreed with his pro European Chancellor, Mr Kenneth Clarke, that Britain would retain the option to join a single currency if the economic criteria were right.
It is understood that right wing cabinet members, led by the Defence Secretary, Mr Michael Portillo, argued that Mr Major must adopt this hardline stance if he wanted the party to unite behind him.
Clearly hoping to reopen argument on the official wait and see policy, the right wing members asked Mr Clarke to present a Treasury paper on the extent to which other European countries were fudging the convergence criteria.
His conclusion that the January 1st, 1999, deadline will "slip by" prompted the Cabinet to agree to toughen its stance and put some distance between the Conservative Party and Labour on Europe.
However, during an impromptu news conference outside Downing Street following the cabinet meeting, Mr Clarke insisted the government had not moved suddenly to the right and stressed he would still be "singing from the same hymn sheet". Mr Clarke appealed to the Euro sceptics to toe the party line and not declare their opposition to a single currency in their personal election manifestos.
The former Chancellor and leading Euro sceptic, Mr Norman Lamont, welcomed this "shift" in the British government's position, but said the battle against the single currency would continue unabated. "A journey of 1,000 miles begins with a single step. I welcome anything that makes it less likely that we shall join a single currency," he added.
The shadow chancellor, Mr Gordon Brown, said: "You have the Euro sceptics saying it means one thing. You've had Mr Clarke saying it means another thing, and Mr Major effectively refusing to say.