To adopt or not to adopt the euro is great imponderable for Blair

BRITAIN's dilemma over joining Europe's single currency is the most important decision facing this generation, Prime Minister Tony Blair told his countrymen yesterday.

In his New Year message to the country, Blair said the political case for joining was overwhelming but hard economics were the crucial factor.

After years of vacillating, Blair must make a decision this year, having pledged to judge the economic case for euro entry by June, to offer the public a referendum vote if he believes that case is made and to shelve it if not.

"This year we will face what may be the single most important decision that faces this political generation the question of whether to join the euro," Blair said.

"We see no constitutional bar to joining and the political case for entry is overwhelming. But ultimately it is an economic union and it is an economic case that must be made.

"We will publish our assessment by June," he promised.

Chancellor of the Exchequer Gordon Brown, in charge of those economic tests, is widely thought to be more cautious than Blair, who last year declared the euro to be part of Britain's destiny.

With the eurozone economy struggling compared to Britain's, the euro itself weak against the pound and interest rates in the currency bloc dangerously low for a steady British economy, there are plenty of reasons to delay.

But, analysts say, Blair also knows that to shy away now will probably remove the opportunity for several years, a time when he may not be so popular or powerful.

And his dreams of leading in the European Union are distant while Britain shuns the bloc's currency.

The next election is expected by late 2005 and the government will not want the process of currency switchover incomplete by then, offering one last chance on the issue to its anti-euro Conservative opponents.

The treasury believes it would take two years after a Yes vote to prepare Britain for new money.

That means if there is no vote this year, the next likely opportunity will not be until 2006 or later.

Meanwhile, most Britons remain opposed to joining Europe's single currency but are still eager to have their say via a referendum Of more than 3,000 people responding to a survey by Internet firm Tiscali, 54% said they do not want to join the euro, though a larger 74% favour a referendum.