Kinnock puts his money on single European currency

SARAH HELM

Brussels

Neil Kinnock, the European Union Transport Commissioner, is strongly urging a new Labour government to take Britain into the single currency at the start, should other countries decide to go ahead in 1999. Mr Kinnock also believes it would be a "perilous" error for Tony Blair, the Labour leader, to hold a referendum on the single currency before deciding whether to join.

So far, Mr Blair has made no commitment to join monetary union in 1999, saying Labour's decision would be based on the "consent" of the people, which could mean it intends to hold a referendum, or call for a mandate to join the single currency in the next election. In an interview with the Independent, a year after he joined the European Commission, Mr Kinnock stressed this week that he has no wish to "back-seat drive". But he warned that if the single currency begins in 1999, "life outside for any length of time for any major economy would not be easy."

Mr Kinnock spoke with confidence and optimism about a Labour victory in the next election, and predicted that Mr Blair would emerge as a new leader for Europe's centre-left over the next decade, saying: "He has the brains and the will. I think he can do it, though he might not realise it yet." The former Labour leader says he is enjoying exercising power of his own for the first time. Yesterday he launched plans for a "citizens' network" to boost Europe's public transport.

However, his confident predictions about Labour and Europe are clearly rooted in the assumption that Labour must first strengthen its commitment to a single currency. A referendum on a single issue, such as monetary union, would achieve nothing for Labour, he believes. "I think salami referendums on specific aspects of policy are perilous - perilous to the national interest, and not just to the reputation of politicians. I am not offering advice to the leader of the Labour Party. But if there was a referendum, for whatever reasons, then it could be about one realistic question - in or out."

Any overt attempt by Mr Kinnock to influence the British political debate on Europe in the run-up to a British election would be deemed highly controversial in Brussels. In November, Mr Kinnock angered his Commission partners by suggesting in a private speech in Britain that the 1999 target date for the single currency was "unrealistic" , which some observers speculated was designed to help Labour.

The claim is entirely unproven, and Mr Kinnock refuses to repeat his prediction, having been reprimanded by Jacques Santer, the President of the Commission.

However, he still maintains that a delay for EMU would not be disastrous, and he dismisses predictions that it would lead to a collapse for the EU, saying the idea that monetary union is only sustainable and credible if it takes place on a particular day "is simply not supportable".

He continued: "I think the future will be better with monetary union, but the idea that this edifice will fall apart if it doesn't start in 1999 is an overstatement, to say the least."

Mr Kinnock knows that his moderate, anti-federalist views can only help Labour in its attempts to defuse Eurosceptic sentiment. Mr Kinnock is eager to emphasise that federalism has gone out of fashion: "There is nobody in Brussels who really wants to build a super-state."

The former Labour leader talks of the need to strengthen the powers of national parliaments over decision-making in Brussels. Federalist expectations raised by Maastricht were "misplaced", and changed circumstances now demand more "restraint" when the new inter-governmental conference starts in March.

Neil Kinnock campaigned for a "No" vote in the 1975 referendum on Europe. That, he says today, was "a very long time ago", and he now talks as if being pro-European is the most natural thing in the world."Blair takes it for granted that Britain must be engaged with Europe."