The Chancellor of the Exchequer, Mr Gordon Brown, came under pressure yesterday from two of Britain's largest industrial organisations to end the confusion surrounding his government's policy on joining the single currency and provide a "long-term sense of strategic direction".
Both the general secretary of the Trades Union Congress (TUC), Mr John Monks, and the director general of the Confederation of British Industry (CBI), Mr Adair Turner, called on the government to join the single currency within the lifetime of the present parliament, although they accepted that with Britain's economic and business cycle currently "out of line" with that of its EU partners, entry in 1999 or 2000 must be ruled out.
With Mr Brown expected to tell MPs in the coming weeks that the government has ruled out joining the single currency before the next election, the comments by the TUC and the CBI will renew pressure on ministers to explain clearly when they intend to do so.
Given the confusion generated by government "spin" in the last few days, Mr Turner, speaking at a CBI manufacturing council meeting, said a "formal statement of intent" must come soon, and ruling out entry in 1999 or 2000 would prevent intense speculation about short-term strategy.
"We believe the UK is not in a position to join in 1999 and that should be ruled out as an option because our economic cycle is out of sync with our EMU partners, and that makes joining in 2000 unlikely. But we believe there's no economic case for ruling out UK participation in either 2001 or 2002, and we would prefer government policy to leave that open," Mr Turner said.
"Such a policy would provide the best balance the government can strike between certainty about the long-term direction and flexibility to assess economic conditions as they develop," he added. Agreeing that government indecision was "costing jobs and growth", Mr Monks told a TUC gathering in London Mr Blair and Mr Brown should recognise that ruling out membership of the single currency before the next election would be a "grave error". The British economy needed "strong, practical leadership" from the government to educate people about the risks of not joining the single currency, Mr Monks said, "but the balance of advantage lies in going with it, not staying outside".
Meanwhile, the Tory leader, Mr William Hague, seized the opportunity to urge the government to clarify its position on the single currency when he accused government advisers of causing "turmoil" in the financial markets as a direct result of a "dither and dodge" policy over the euro. Membership of the single currency carried "far too many economic risks", Mr Hague insisted and he called on the chancellor to rule out entry within the lifetime of the next parliament - a possible date of 2007.
He added: "Forget the markets. Forget jobs. Forget the constitution. All that matters to them is newspaper editorials and a soundbite on the evening news. This is a government of sub-editors: they want the headlines to say one thing and the detailed copy to say another."