Peter Mandelson has predicted that Labour will soon hold - and win - a referendum on the single currency.

Dismissing the sceptics, the former Northern Ireland secretary says Tony Blair could take his case to the country in the lifetime of this parliament.

Interviewed on the BBC's Hardtalk programme on Tuesday, he said: "We probably won't go into a referendum with the opinion polls saying we are going to win it. I expect at the beginning of a campaign more people will be sceptical and against than persuaded but then that is the point of a campaign."

Mandelson's comments echo those made by prime minister Tony Blair at the Labour Party conference earlier this year.

In recent weeks reports have suggested that Blair is planning to hold a referendum on the single currency as early as 2003.

Senior ministers are said to believe the introduction of euro notes and coins will play a significant part in breaking down the public's hostility to the euro.

However, polls show Blair has a mountain to climb - with fewer than one in three voters backing membership of the single currency.

In his interview, Mandelson also discusses the Hinduja passport affair - which drove him from the cabinet for a second time. The former minister and Blair confidante says he is still angry with the media for the "flimsy allegations" levelled against him.

Despite predictions of a third comeback, Mandelson says that he does not expect to return to the front bench - but insists he remains loyal to Blair.