We will not alter our course, says defiant Cook

Political fallout

Labour and Tory spin machines went into overdrive yesterday as both parties attempted to assess the impact on the United Kingdom of the dramatic result from Denmark.

Labour and Tory spin machines went into overdrive yesterday as both parties attempted to assess the impact on the United Kingdom of the dramatic result from Denmark.

Robin Cook, the Foreign Secretary, led the line-up for the Government, declaring that that the Government would still go ahead with a referendum after the next general election if it thought joining the euro would be in Britain's economic interests.

But Michael Portillo, the shadow Chancellor, and Francis Maude, the shadow Foreign Secretary, seized on the Danish poll as proof that membership of European Monetary Union was not inevitable.

As the implications of the opponents' victory in Denmark sank in, the pro-euro and anti-euro lobby groups swung into action and produced lengthy documents stating their case.

Pro-Europeans claimed that Denmark's economy and political role with the European Union were starkly different from those of the United Kingdom, while the Eurosceptics claimed that the result proved the Opposition could no longer be portrayed as "right-wing".

Mr Cook said it would be "irresponsible" not to hold a referendum if the economic circumstances were right for joining the euro. "The vote last night does not alter in any way the fundamental fact that the eurozone contains 250 million people who provide the market for the majority of our exports, and that there are 5,000 American and Japanese companies who invest here because they want to export to that market," he told BBC Radio.

"Those are the critical, crucial questions that will weigh with the British people, who will make the decision on what is right for Britain, not what is right for Denmark."

However, Martin O'Neill, the chairman of the House of Commons' Trade and Industry Select Committee, said that the level of the euro was a much more decisive factor. "We had hoped that the euro's decline would have ceased and action taken either by the international currency markets or the European Central Bank would have led to an improvement in the value of the currency. That hasn't happened," he said.

"Unless there is a marked improvement in the value of the euro, I think it would be very difficult for people like myself who want us to join and would rather we join quickly to advocate an accelerated process, because of the distortion that it would cause to our currency of having to devalue, and the dangers that that would create for inflation."

Mr Portillo said that the Danish vote introduced "an important change" to the British debate. "[One of the] arguments that were really made in favour about going in was that we should be fearful in some way of being left out, fearful of being isolated," he told BBC Radio.

"Well of course we are not now isolated; other people in Europe have taken the same view. The other argument was that it was somehow inevitable that we would go into the euro. Well, it clearly isn't inevitable; it is within the capability of the British people ... to vote 'no' if they are offered that chance in a referendum."

The Labour MP Tony Benn, who is against the euro, has invited Ole Krarup, the leader of the Danish 'no' campaign, to London for tactical talks on 7 October about how to ensure there would be a similar result in a British referendum.

Mr Benn said: "I am keen to hear from socialist Danes who have opposed the single currency. It is vital that we start to use the same arguments in the United Kingdom's campaign against the euro."

Mark Leonard, the director of the Foreign Policy Centre, a think-tank of which Tony Blair is the patron, said that the Government should learn the lessons of the Danish vote.

"Denmark shows that 'It's the politics, stupid'. Of course people care about jobs and mortgages, but they still won't vote for the euro if we don't win the argument on sovereignty too. We have to point out the consequences of being side-lined in Europe," he said.

Mr Leonard added that the Danish referendum had suffered from "disastrous timing", with record lows in the value of the currency against the dollar.

Lord Howe of Aberavon, the former Tory chancellor and foreign secretary, warned sterling would become a "punch-ball currency" if the UK remained outside the euro. "If the 'no' argument were to prevail in this country on that issue, my real fear is that the pound sterling would become ... tossed on the sea between the dollar and the euro."