Campaigners rethink strategy after euro vote decision

Campaigning groups on both sides of the battle over the single currency have drawn up emergency plans to cut staff in anticipation of Tony Blair's decision to rule out an early referendum on the euro.

He and Gordon Brown, the Chancellor, reached a final deal on the politically explosive issue at a private meeting at Chequers, Mr Blair's country home, this week.

They will announce next month a "not yet" verdict on the Treasury's five economic tests for membership. But, to Mr Brown's annoyance, the Prime Minister appears determined to leave open the option of a referendum before the next election, possibly as early as next year.

Britain In Europe, which would lead the campaign for a "yes" vote, admitted that any delay would have a serious effect on the organisation – which had been gearing up for a national poll on membership this year.

A board member said: "We can't run a campaign at a level of intensity if there's a vague promise to have a referendum at some point in a distant future."

The organisation, which has struggled to raise money, has 36 staff and recently moved to new headquarters in north London. It refused to say how many workers could lose jobs in a scaling back.

Meanwhile, the "No Campaign", which would lead opposition, is also preparing cut-backs. It predicts that it could lay off up to half of its 33 staff – 18 in London and 15 in regional offices – once the announcement is made.

Mr Brown was reported yesterday to have told the Prime Minister that only one of the five tests had been met. The only one that has been satisfied – regarded as the least important – is whether membership would benefit Britain's financial services industry.

Supporters of the euro insisted the assessment had not killed off the prospect of membership, because the other four tests may have been only narrowly missed.

Government sources said the announcement still had not been finally settled. One said: "We are not into running commentaries but let's just say work is still going on."