The prime minister has given his clearest signal yet that he is prepared to go down in history as the man who scrapped the pound.

Using a second BBC Newsnight interview to make an unusually forthright declaration of support for the European single currency, Tony Blair's statement that it would be "crazy" to stand aside from Europe has triggered renewed speculation of a euro-referendum next summer.

Asked whether the government was close to a decision on Gordon Brown's much-vaunted five economic tests, Blair replied: "Yes, it is."

"Once the tests are passed we believe it is in the interests of your economy, so we believe you go in."

"The key decision is if the economic tests are passed are we going to then recommend it to people in a referendum. The answer to that is yes."

Tackling the issue of the pound head on, the PM told the BBC that be happy to be remembered as the man who scrapped the UK's currency.

"I would have no problem with history recording me as the person who said to the British people: 'It is in our interest for us to be a key and major player in Europe and here is something that is, as in the single currency, in our economic interest to do so'," he said.

Blair's "passionate" endorsement of the euro has been greeted with enthusiasm by pro-Europeans.

Lib Dem leader, Charles Kennedy, acknowledged that "it's much further than the prime minister has gone before" and called on the government to start the euro countdown.

"Let's just hope that Tony Blair has the active support of his chancellor this time," he said.

"We need a clear timetable for a referendum and we need it as soon as possible. Let's get on with it.''

Former Conservative home secretary, Lord Brittan, a member of the Britain in Europe group, also responded warmly.

"I am glad that the positive rhetoric is hotting up. The ground is clearly being prepared," he said.

"The prime minister must realise that delay and uncertainty are damaging. I hope that we can now move rapidly to the completion of the assessment of the economic tests and a referendum."

Conservatives have accused Blair of "playing games" and taking his eye off the ball of public service delivery.

Shadow chancellor, Michael Howard, argued should be concentrating on issues like health, education and law and order.

"The public is looking to the prime minister to focus on these issues instead of playing games over the euro,'' he said.