Following Gordon Brown's announcement earlier this month that Britain is not yet ready to join the euro, John McFall, chairman of the Treasury select committee, has responded to ePolitix.com Forum views on the issue.

John McFall, chairman of the Treasury select committee, told ePolitix.com: "I welcome the comments and views on the euro announcement received through the ePolitix.com Forum.

"It is vital that the government continues to encourage full and frank debate amongst business, trade unions, consumer groups and the wider electorate. If and when the debate moves on to a referendum every effort should be made to help the public feel that they have access to sufficient-objective-information to enable them to vote confidently. Many organisations will have a part to play in achieving this goal.

"No decision to join the euro should be made if the economic case has not been satisfied, however, analysis of the economic issues is not a mechanistic exercise and will involve a significant element of judgement.

"The chancellor strongly set out the potential benefits to the UK of joining the euro in terms of increased trade, investment and prosperity. He was right to stress that these benefits can only be achieved if sufficient convergence and flexibility exists.

"I believe, as acknowledged by the chancellor, that there has been significant progress in convergence between the UK and the eurozone since 1997. While structural differences such as the housing market still exist between the UK and the eurozone economies, the chancellor announced practical and positive steps to tackle these differences.

"Fundamental to the UK's decision is the performance of the eurozone economy. The government should continue to encourage and support reform that can improve prosperity and economic growth in Europe.

"I note the Treasury's innovative proposals to examine whether fiscal policy can play a role in stabilising output. While original, it is vital that changes in rates of VAT do not impact adversely on low income and vulnerable households, for whom VAT and other indirect taxes represent a higher proportion of disposable income."

Forum Response: Institute of Directors

Ruth Lea, head of the policy unit at the IoD, said: "Whilst we are pleased that the chancellor has announced that the British economy has not yet met his five tests for euro membership, we are disappointed that he will be re-assessing Britain's economic readiness next year.

"We strongly believe that the British economy has not yet attained sustainable convergence with the rest of the eurozone and that we, therefore, could not live happily with the ECB's interest rates.

"Moreover, and crucially, we cannot see how the British economy will meaningfully attain sustainable convergence with the rest of the eurozone over the next two to three years. The chancellor should, therefore, rule out re-assessing Britain's economic readiness for euro membership for the lifetime of this parliament. This would provide much needed stability for both the financial markets and for business."

Forum Response: Consumers' Association

Stephen Crampton, CA's EU advisor, said: "Given some of the abuses that occurred in first wave countries, a voluntary approach to dual price information would be complacent.

"While official EU figures suggest that the switchover added only 0.2 per cent to consumer prices, CA believes these do not reflect consumers' experiences in particular sectors or of real problems of individual unfair dealing.

"EU surveys suggest that 84.4 per cent of consumers in the first wave countries thought that prices had been converted to their detriment: survey respondents believed that prices had always been rounded up in small food shops (80 per cent), in services (80 per cent), cafes and restaurants (85 per cent), public transport (55 per cent), for vending machines (62 per cent) and in bank charges (53 per cent)

"CA is calling for legislation to ensure that, if and when the UK joins the euro, consumers are given price information in both pounds and euros. This 'dual pricing' enables consumers to become familiar with the new currency, and provides an important safeguard against hidden price increases.

"CA also warns that, although the chancellor is likely to announce that the five tests for UK membership of the euro have not yet been passed, UK consumers still need to be aware that the euro will affect them, whether or not they visit "euroland" countries, in the following ways:

"While the UK remains outside the euro zone, the euro is for UK consumers just like any other foreign currency - its value will rise or fall against sterling. UK consumers who take out loans or make investments in euro (or in other foreign currencies) will continue to be vulnerable to exchange rate fluctuations. If the value of the pound falls against the euro, then the amount borrowed and the cost of repayments in sterling will also increase.

"Although the euro is not legal tender in the UK, it is being accepted voluntarily by some UK retailers, particularly in tourist areas. Consumers from the euro zone, and returning UK tourists, can thus spend euros in the UK .

"However, while the UK is outside the euro zone, retailers who choose to accept euros voluntarily will be free to set their own sterling/euro exchange rate. Consumers will need to check how the exchange rate on offer in shops compares with that in banks and bureaux de change.

"UK consumers will need to check carefully the currency of payment when shopping on the Internet."

Forum Response: British Retail Consortium

Bill Moyes, director general of the British Retail Consortium, said: "The BRC does not hold a view on EMU. However, if and when the British public decide to adopt the euro, retailers will be at the forefront of ensuring a smooth changeover. It is therefore imperative that the government listens to the views of retailers on the date for a new currency to be introduced and the time needed for preparation.

"The chancellor's report on the euro and prices issued today is another nail in the coffin of 'rip-off' Britain. It demonstrates yet again that price differentials are about the economic circumstances of individual countries and not retail profits."

Forum Response: Chartered Institute of Personnel and Development

Dr Philpott, chief economist at the Chartered Institute of Personnel and Development, told ePolitix.com: "The long-run consequences of the UK's decision to either join or stand aside from the euro will mainly show up in productivity and living standards, rather than jobs. The Treasury's 'jobs test' is therefore really a test of whether euro membership will make UK growth and employment more or less stable.

"The government's decision on a euro referendum will be based as much, if not more, on political rather than economic considerations. In practice, however, it is difficult to separate the economics from the politics on this important issue since euro membership will clearly affect the UK's relationships with its EU partners.

"Perhaps the ultimate jobs test facing the government is that of whether efforts to promote a prosperous full employment UK, and a full employment Europe, are likely to prove more successful inside or outside the eurozone."

Forum Response: Council of Mortgage Lenders

Michael Coogan, director general of the Council of Mortgage Lenders, said: "The chancellor cited the housing market as a reason to delay any recommendation for UK entry to EMU.

"The CML believes that the UK mortgage market is sufficiently sophisticated and flexible to thrive either inside or outside the euro environment. UK mortgage borrowers are already extremely well-served. Despite the fact that base rates in the eurozone are lower, the UK has lower mortgage rates than the majority of euro countries.

"Perhaps the importance of the structural differences in the UK housing market is being a little over-stated - one thing that is abundantly clear is that housing markets across Europe remain massively divergent for a variety of reasons.

"It is helpful that the euro dimension to the review of fixed-rate mortgages should now become less pronounced, so that the relative merits of long-term fixed rates can now be explored outside the immediate politics of the euro debate."

Forum Response: Economic and Social Research Council

Ray Barrell, spokesman for the ESRC, told ePolitix.com: "The current government and the political establishment in the UK is largely in favour of membership of monetary union, but the UK failed to be a part of the process of the creation of the union, and hence in 1997 when the government was elected conditions were not right for approaching membership.

"The government suggested a set of rather ambiguous tests that it could have expected to have been passed if all went well. The Institute, in a sequence of papers, has concluded that the tests are met, and membership would be in the national interest.

"Between the summer of 1997 and that of 2003 interest rate differentials have declined from three percent at the short end to just over one percent and have virtually disappeared at the long end, declining from 1.2 percent.

"Output gaps are also more similar, with both economies now operating with some amount of excess capacity, whilst in 1997 the UK may have been above capacity and the euro Area below it. Between 1996 and 2002 sterling did, however, look overvalued against the euro, and this might have been a major barrier to early entry.

"The recent block realignment of the euro and the dollar has taken sterling down significantly against the euro, and at less than 1.40 euros to the pound the exchange rate barrier appears to have been removed. Hence conditions look much better for UK membership.

"It is relatively clear that the political situation is not yet right, and we would not expect a rapid movement to the euro to be announced at this time."

Forum Response: The Association of Chartered Certified Accountants

Chas Roy-Chowdhury, ACCA head of tax, said: "Whatever view one has on the euro issue, UK business will at least have a clearer idea now of where it stands. It is clear from the chancellor's statement that the government has decided to take this issue to the British people next year.

"The chancellor said that only one of the five tests have so far been met - but he put great emphasis on major reforms aimed at ironing out the remaining problems on convergence and flexibility over the next twelve months.

"One must wonder though why it has taken six years to reach this stage and yet just one year to achieve convergence with the European economies, given it is such a major undertaking.

"ACCA is pleased that the chancellor will set up a fiscal stability pact, reporting direct to parliament, similar to the current monetary policy committee. This will take the politics out of tax and is an important step which ACCA has been urging him to take for a long time.

"We are also pleased that he gave a nod to tax competition between states, although he should not forget the fact there are some useful tax co-ordination measures across Europe which would be of benefit to business, and which could be adopted."

Forum Response: GMB

Kevin Curran, GMB general secretary, said: "The chancellor has given a ray of hope to workers in the manufacturing sector. We believe that Gordon's prudent preparations will lead to an endorsement of entry in the Budget.

"We now have a road map for the future. A summer referendum is winnable and in our economy's best interest."

Forum Response: Federation of Small Businesses

John Walker, FSB Policy Chairman, said: "The most important thing for businesses is economic stability. Although small firms face another year of uncertainty, we are pleased that measures have been put in place that will allow a referendum to take place sooner rather than later.

"The most crucial aspect for small businesses is closure on this debate, providing finality. The best way of achieving this is by settling this issue now, which we believe is by keeping the pound."