Speculation grows over referendum on EMU

Date: 21/03/1996

A DECISION on whether to sign up to the single currency may be nearly two years away, but that has not stopped the debate in the UK on whether to hold a referendum on the issue from reaching fever pitch.

Speculation is mounting that the British Government is on the verge of giving way to

Eurosceptic calls for a referendum, although senior ministers are trying to play down rumours that an announcement will be made by the end of this month.

Conservative Eurosceptics have waged a long war of attrition with their own party leaders over the issue, piling relentless pressure on Prime Minister John Major either to rule out any prospect of the UK joining a single currency or, at the very least, to pledge a referendum on the issue.

Major is believed to favour giving such a pledge in a bid to avoid more in-fighting over the issue inside Conservative Party ranks in the run-up to the UK general election which must be held by May 1997 at the latest.

But the debate took a new twist this week amid reports that Chancellor of the Exchequer Kenneth Clarke was considering resigning if his cabinet colleagues decided in favour of holding a referendum.

Clarke was quick to deny these reports, but that was not enough to halt another fevered bout of speculation that his opposition to a plebiscite was the only thing standing in the way of a formal announcement that one would be held.

UK Foreign Secretary Malcolm Rifkind appeared to confirm that the government was moving towards a firm commitment to put the issue to a vote when he told a parliamentary committee that some issues were best resolved by a referendum and that he expected a decision to be taken “within weeks rather than months”.

But Rifkind muddied the waters by suggesting that the outcome of such a vote might not be binding on the government. After coming under fire from the Eurosceptics for his remarks, the foreign secretary later tried to repair the damage by insisting that governments had always indicated in advance that they would accept the outcome in previous referenda, even though not technically obliged to do so.

Meanwhile, an opinion poll published by one Sunday newspaper this week suggested 80&percent; of Britons were in favour of a referendum and 67&percent; would vote against a single currency if the issue was put to the vote.