EU split warning over single currency

The Foreign Secretary, Malcolm Rifkind, will warn tonight that a single European currency could create a dangerous and semi-permanent split in the European Union.

Stepping up British confrontation in advance of next month's special Dublin summit, designed to press ahead with further integration, Mr Rifkind will say in Zurich: "We should not proceed down a path of integration faster or further than our people are prepared to go.

"Those who neglect this maxim fall into the trap of seeing Europe in terms of a state: of thinking that we can better achieve our common goals simply by projecting the aspirations and ambitions of individual nations on to an EU canvas."

The tone and tenor of Mr Rifkind's speech will delight Tory Euro-sceptics in the run-up to next month's party conference - adding to the heightened sense of confrontation raised by yesterday's rejection by EU ministers of Britain's call for a reduction in the selective cattle cull, aimed at eradicating BSE.

That decision left the Government with a stark choice: defy Brussels and unleash a new beef war, or risk a damaging Commons defeat on the slaughter policy.

Douglas Hogg, the agriculture minister, dispatched to Brussels to sound out European colleagues on a cut in the planned cull of 140,000 animals, was sent home with a humiliating rebuff. Clearly exacerbated by London's attempt to renege on a deal hailed by John Major in June as a "triumph", EU ministers dismissed as "nothing new" studies showing that the disease will die out by 2001 regardless of the targeted cull; the basis for Mr Hogg's plea for a review.

Some even warned of financial retaliation if the cull is ditched with a block on thepounds 300m the EU is expected to pay this year to cover the cost of destroying cattle over the age of 30 months.

Downing Street sources indicated Britain would not go it alone, by unilaterally reducing the cull, and John Major is expected to call an urgent meeting of ministers over the crisis.

The Government's business managers have advised the Cabinet they are unlikely to get a vote for the expanded cull through Parliament. Mr Major now faces the prospect of admitting that his hopes of beginning to lift the ban by the end of the year have been dashed.

Conservative MPs were pessimistic about the chances of lifting the ban before the end of the century. "There is a growing realisation that it doesn't matter what we do - they are going to keep that ban on until the last cow has died from BSE in the year 2001 or 2002," said Sir Jerry Wiggin, Tory chairman of the Commons select committee on agriculture.

Sir Edward Heath, the former prime minister, said Britain was in difficulties about beef because "most of the other countries are so fed up with us".

In his Zurich speech Mr Rifkind will warn that an EU-divided between a "small elite" of single-currency states and the rest is "not what the founding fathers" of Europe had in mind.

His words go beyond previous warnings about a single currency. After pouring cold water on it for months, it appears the Government accepts the single currency will go ahead on time at the end of the century.