THE euro has now been in circulation for 12 months -- and even though Britain is still stalling on joining the 'euro zone' the debate in East Lancashire on the single currency has never gone away.

Business Editor ANDREW CALVERT looks at how the new currency has affected the area and whether the campaign for inclusion is gathering pace...

TENS of thousands of local holiday-makers will have used the euro on holiday since it became the only currency for 300 million people in 12 European countries.

For frequent travellers in particular, the euro has proved a real boon as they save on the cost of exchanging currency.

Many have found they can spend the euro in the UK and some leading department stores readily accepts the new notes.

But manufacturing companies say Britain's reluctance to embrace the euro, which has strengthened after an early struggle and is now worth around £0.64 is costing export orders and jobs.

Politicians in both the 'yes' and 'no' camps remain as divided as ever. Hyndburn's Labour MP Greg Pope has called for an early referendum and is backing a yes vote.

"I have been a long-term supporter of a successful single European currency and believe passionately that it is in Britain's interests to join soon," he said.

"There is no doubt that remaining outside the 'euro zone' is damaging exporters in East Lancashire and across the UK. There is no future for us as a half-hearted member of the European Union and the sooner we join the better."

But in neighbouring Ribble Valley, Conservative MP Nigel Evans is opposed to Britain signing up to the euro and believes it would destabilise the economy.

"Joining the euro would be like scrambling on to the sinking Titanic from the lifeboat that is the pound sterling," he said.

Blackburn MP Jack Straw, in a keynote speech on Europe earlier this year, was more circumspect.

"Given our economic dependence on the single market, a successful single currency has always, in principle, been in our interests," he said. "I am delighted to say that the Euro has got off to an excellent start.

"Our position on entry remains as set out by the Chancellor of the Exchequer in 1997.

"We must satisfy the five economic tests before any decision to join can be taken.

"As the Prime Minister said earlier this year, if the tests are met then the government believes it is "overwhelmingly in this country's interests to join. But ultimately the public will have the final say in a referendum."

A Liberal Democrat perspective came from Burnley councillor Gordon Birtwistle, whose company, Oswaldtwistle-based Stuart Engineering, closed down in March with the loss of 44 jobs.

Coun Birtwistle blamed the closure on the Government's reluctance for joining the euro.

"Manufacturing is being destroyed by the strength of the pound," he said.

"We cannot compete with countries within the 'euro zone' because we have higher interest rates, and we can't compete with countries in Eastern Europe, because their labour costs are considerably cheaper than ours."

Mike Murray, chairman of Business Link East Lancashire, said Stuart Engineering's difficulties were symptomatic of the problems faced by manufacturers.

"There is no doubt that the industry is facing tough economic conditions," he said.

"The high pound has affected a lot of manufacturers. It pushes prices up and makes our goods more expensive overseas."

Mr Murray said he wholly agreed with the Government's stance that it needed to meet economic targets before having a referendum.

He was concerned, however, that staying out of the euro would damage overseas investment in the UK.

"American and Japanese companies want to place businesses where their costs are stable," he said. "If, for example, you are building cars for sale across Europe, you do not want fluctuating exchange rates. The strength of the pound against the euro does not help the case for investment in Britain."

Trade unions, however, have become more lukewarm about the euro following concerns that Government spending on health, education and other public services would have to be cut.

When the euro was first launched on January 1, 2002, Debenhams in Blackburn was one of the first stores to accept the new currency.

According to manager Stephen Crolley, there has been a steady flow of euro notes through the tills.

"Staff have been trained to convert prices for the euro and we are taking the new currency weekly," he said. "They are being spent by both European visitors to the town and by people returning from holiday with some euros left."