Euro-sceptics win vote with Labour help

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Indy Politics
Tory Euro-sceptics yesterday joined Labour to inflict an embarrassing defeat on the Government over claims that Britain's "opt out" from the European single currency has been undermined by Brussels.

John Major now faces the threat of renewed Tory backbench rebellions in the run-up to the election, unless he blocks the measures by the European Commission which the Tory MPs claim would rob Britain of its opt-out and hand control of monetary policy from the Chancellor to the Governor of the Bank of England.

Tory Euro-sceptic MPs packed into a meeting in a committee room at Westminster to give a show of strength against the Government for refusing to allow the claims to be aired in the chamber of the Commons.

The Speaker, Betty Boothroyd, was drawn into the row to force the Government to back down and allow the debate to go ahead, after the defeat by six votes to seven in the committee.

Tory MP John Whittingdale, a former aide to Baroness Thatcher, broke the Government's majority on the committee when he voted with Opposition MPs.

The rebellion was seen as a clear threat by the Euro-sceptics to end their pre-election truce with the Government if John Major fails to reject the proposals by the European Commission which they claim would open Britain to fines for failing to meet the targets on debt for those inside the European single currency.

The Prime Minister shrugged off the defeat and the threat of fines was "something right at the end of the road ... So it is very much a last resort. This is one of the things that is being discussed as part of the so-called stability pact."

The call for a full debate on European Monetary Union was also backed by Tory former ministers Kenneth Baker, John Redwood and chairman of the Foreign Affairs select committee David Howell.

Mr Redwood said Commission proposals would mean Britain would be forced to accept "price stability" as its prime target for the economy. "The Government should tell us how high interest rates would have to go to get down to zero inflation," he said.

The row came as Robin Cook, Labour's foreign spokesman, signalled that moves on a referendum on Britain's entry into a single currency could come early in a Parliament under a Labour government.

A Referendum Act, could pave the way for Labour's plans for widespread constitutional reform and Britain's entry into a single currency, Mr Cook told a Westminster press gallery luncheon.

Labour is planning a series of referendums, including one on devolved powers to a Scottish Parliament, and the "parent" referendum act could therefore prevent rows over the measures blocking Labour's legislative programme.

The referendum could be triggered by an order which could be passed later through Parliament with a simple majority vote. The will be seen as an attempt to avoid the referendum on a single currency being blocked by Euro sceptic Parliamentary tactics and the business of a Labour government becoming bogged down in the early months after the general election.