Industry says yes to single currency

Business leaders last night predicted that Europe would move to a single currency in 1999 as a survey showed that industry was backing Britain's participation in economic and monetary union by two to one.

Adair Turner, director general of the Confederation of British Industry, said: "If anything, business is moving in a more Europhile direction."

He was speaking as the CBI published a poll of 1,700 businessmen on the eve of its national conference in Harrogate showing that more than half of firms - 56 per cent - supported EMU in principle while 30 per cent were opposed.

Business leaders were also increasingly in favour of Britain being in the first wave of monetary union. The proportion of firms who thought the pound should enter a single currency in 1999 had gone up from 19 per cent a year ago to 28 per cent now.

Sir Colin Marshall, the CBI's president, said he believed there would be a single currency in 1999 and that Britain should not rule out the option of joining.

"The single market is of vital importance to our future success and while there is still a split in views over EMU there is little enthusiasm for ruling it out as an option," he said. "To reject it now would give us no say as to how the Euro-coin eventually falls."

The business community's broad endorsement of EMU was coupled with a warning to the Government that the Euro-sceptic wing of the Tory Party was damaging Britain's economic industry. David Richardson, president of the British Chambers of Commerce, which jointly published the survey, said: "There is a strong view that it is our politicians that are letting us down. The message from business is clear: stop playing games with our future in Europe."

The theme of Europe and the single currency is set to dominate the next two days in Harrogate with the conference culminating in a debate between Europhiles and Eurosceptics, led by the former Cabinet minister John Redwood, debating the issue on Tuesday.

Gordon Brown, the shadow Chancellor, is expected to move Labour towards a more pro-business stance on Europe when he addresses the conference today. Mr Brown will tell delegates that Labour would oppose any extension of qualified majority voting on Social Chapter legislation. "I can assure you that not only do we have no plans to extend qualified majority voting in these areas, but we would veto any attempt to do so," he will say.

The CBI/BCC survey, carried out in November by Mori among 5,000 businesses, shows that only 10 per cent of businesses back a single currency outright, believing it essential to ensure the competitiveness of UK business. However, there is an even smaller minority of just 7 per cent of firms who say that Britain should reject a single currency point blank.

Sir Colin said the results disproved claims that business had become more Eurosceptic over the past year. He also rejected suggestions that the business community was split over EMU, saying: "Business and industry across the country and across the spectrum from large to small enterprises are in favour of the move to EMU and a single currency."

But he refused to be drawn on whether the CBI would throw its wholehearted support behind Britain's membership of the first phase of EMU. The employers' organisation is to begin a mass consultation exercise among members immediately after the conference with the aim of making a firm recommendation in the middle of next year after the election.

The CBI added that it did not approve of member states fudging the figures in order to qualify for EMU. But it said that while Britain was unlikely to meet the requirement to keep the public deficit to less than 3 per cent of GDP, it was much more important that it met the target of limiting overall debt to 60 per cent of national output.