Britain’s eurozone entry ‘long way off’

BRITAIN’S entry to the eurozone remains a long way off, former British Prime Minister John Major told delegates at yesterday’s family business conference in University College Cork.

There was no prospect of signing up to the euro in the short term regardless of the outcome of next month’s general election, he said.

However, Mr Major did not rule out the end of the pound, whose abolition would wipe out exchange rate problems for Irish exporters and make it easier to trade with Britain.

“There are circumstances in which we would join,” he said.

Euro interest rates would need to be around 4% lower than those in Britain to give voters a tangible benefit from euro entry.

A decision to join would force British rates down to eurozone levels and appeal to homeowners by slashing monthly mortgage repayments.

This would, said Mr Major, help to provide the public support necessary to swing a vote in favour of the switch.

The British government has pledged that no decision to join the eurozone will be taken unless it is approved by both parliament and voters in a referendum.

Opinion polls suggest the proposal would be soundly defeated if put to voters in the near future. Mr Major added that neither Prime Minister Tony Blair, chancellor Gordon Brown or Conservative leader Michael Howard - would be willing to hold a referendum.

Mr Major’s address also urged family business owners to recognise the qualities necessary in leaders and take painful decisions to secure the long-term future of their businesses.

He cited British companies such as chocolate manufacturer Cadbury’s, which started out as a family-owned business but whose long-term success was built on an ability to deal with long-term problems by taking unpopular decisions.

Business leaders also needed to be able to recognise the things over which they had no control, but which would have an effect on their company and its trading environment.

Businesses in Ireland would not be immune over the long term to developments in China, India or Iraq, he warned. “Events from the most remote corner of the world will make their way into our lives,” he said.

Mr Major also said that he had personal experience of the risks taken by family business owners and the level of effort required to be an owner/manager. Mr Major’s family gave up their home after his father’s business folded during his childhood.