Spending ban on euro poll

TONY BLAIR'S drive towards a single European currency has been hampered by Treasury guidelines which bar the Government from spending public money to campaign for a "yes" vote in the single currency referendum.

According to advice from the Treasury Officer of Accounts, the Government can use taxpayers' money only on "any expenditure which is considered necessary so that the general public can make an informed decision when they vote in the referendum".

The national changeover plan is due to be published this week as part of the Government's "prepare and decide" policy. The Treasury advice is the first concrete confirmation that a "yes" campaign, likely to cost millions of pounds, will have to be privately funded.

While the eurosceptics have some big backers, including the millionaire businessman Paul Sykes, the pro-European groups have not done as much preparatory work on their campaign.

The Labour peer and media magnate, Lord Hollick, may be prepared to meet a large chunk of any yes campaign costs, along with other businessmen in a cross-party pro-euro alliance he formed last year.

Outside experts estimate that the total amount of expenditure needed to convert the public sector over to the euro could be around pounds 1bn.