Major agrees to compromise on referendum

Date: 11/04/1996

AFTER months of wrangling within the ranks of the British Conservative Party, Premier John Major has finally bowed to calls for a referendum to be held if the government decides to join a single currency.

The pledge will be included in the party's manifesto at the next general election, now only 13 months away at the most. The change in policy is a further illustration of the growing strength of the Eurosceptic wing of the party.

But pro-Europeans, led by Chancellor of the Exchequer Kenneth Clarke, have succeeded in winning concessions which took the sting out of last week's announcement.

Under a compromise struck between Clarke and Major, the Conservatives will go into the election keeping their options open on a single currency and, if the government decides in favour of EMU, ministers will be required to support that decision in the subsequent referendum or resign.

The concessions were agreed in the wake of rumours in the UK parliament that Clarke had threatened to resign if Major bowed to his Eurosceptics' demands for a referendum.

Essentially, the compromise means that the battle within the Conservative Party over the single currency will not be fought until after the election - with Major hoping that his pledge to put the issue to the vote will avoid damaging splits within the party in the run-up to polling.

The whole debate could turn out to have been merely an academic exercise. The decision on whether or not the UK should join EMU will not be taken until after the election, and opinion polls suggest that it will be a government headed by Labour leader Tony Blair which will have to decide.