Comments by Foreign Office minister Denis MacShane that British membership of the euro is now a question of "when, not if" have been challenged by the prime minister.

In an interview with ePolitix.com, Europe minister Denis MacShane said the balance has tipped towards inevitable membership of the single currency.

Saying the UK is at a "turning point", MacShane warned that Britain will squander its competitive edge by staying out of the euro.

But Tony Blair rejected the assessment saying the issue had to be decided "on its own merits".