Pro-Europe campaign spills on to the streets

The increasingly bitter struggle over the future of the pound reached the streets of the City yesterday. At 6.30am outside Liverpool Street station supporters of the European Movement, a pro-European campaign group, were handing out leaflets making the case for membership of the single currency.

The group has a stock of 8,000 leaflets, titled "The Other Side of the Coin", and an annual grant of pounds 20,000 from the EU with which to promote its cause. As the Labour MP Giles Radice, its chairman, observed ruefully at the official launch, the European Movement is easily outspent by Sir James Goldsmith's Referendum Party.

The brochure, which will be handed out at the CBI's annual conference this month and sent to financial institutions and banks, tries to tackle the most frequent objections to European Monetary Union.

Mr Radice found himself on the defensive over suggestions that the Labour Party was moving away from its earlier sympathy for the idea that Britain should join the single currency in the first wave.

Robin Cook, the party's foreign affairs spokesman, said last month it would be hard for Britain to join in the first wave in 1999. But Mr Radice said yesterday: "My own view on the position is exactly as it was before."

Conservative MP Quentin Davies, a vice-chairman of the European Movement, warned: "Wait and see is not a cost-free option."

He said if Britain did not join, its interest rates would have to be higher than those in the Euro-zone and the country would become less attractive to foreign investors.

John Stevens, the Tory MEP for Thames Valley, said the European Movement wanted to make a positive case for joining the single currency. "Joining would be the most powerful boost to the City's position there has ever been," he said.

However, the new pamphlet concentrates on countering some of the most common arguments against UK membership. A lot of these were "very ill- founded", Mr Radice said.

The campaign claims that Britain will not lose the power to run an independent government spending and tax policy. Nor will there have to be big subsidies of poor member countries by rich ones.

It argues that the single currency would create jobs rather than increase unemployment because interest rates would be much lower if Britain were part of the Euro block. Mortgage rates would be able to fall too.

It also challenges high estimates of the costs of switching over to the Euro, saying that banks and shops would have to spend large amounts on upgrading their equipment and software anyway. It puts the total transition cost at pounds 2.5bn.

Mr Radice acknowledged that monetary union would lead to closer political integration. But he added: "There is no evidence that the great British public is concerned about sovereignty. What they are interested in is the bread-and-butter issues."

Lord Kingsdown, former Governor of the Bank of England, who was also backing the launch, said: "The idea that any individual country has monetary sovereignty is illusory."