Anti-euro group too British?

The Business for Sterling group has recently made its mark as a campaigner against the single European currency. As reported here last month, the anti-euro group has the backing of such business heavyweights as Sir John Craven, chairman of Lonrho, Lord Hanson, Dixons chairman Sir Stanley Kalms, Lord Sainsbury of Preston Candover and Lord Wolfson of Sunningdale, the chairman of Great Universal Stores, all of whom serve on the group’s council.

But while Business for Sterling “is committed to membership of the European Union and making a success of the European Single Market”, the companies represented by this impressive array of business leaders have low exposure to continental European economies. This may be perceived as undermining the strength of their argument, relegating their case “against” from that of a rational contribution to the debate, to one of a special interest pressure group, which may have to bear the costs of euro-conversion without being in a position to benefit from it.

Dixons, for example, has no retail interests in Europe, though it does have a property portfolio. The group’s annual report says that the impact of the single currency on the group would be “limited initially”.

Only 14% of turnover at Great Universal Stores is in continental Europe.

Hanson’s accounts make no specific disclosure of European interests.

But a spokesman insisted that the authority of the group is not undermined by virtue of its relative lack of European exposure: “It doesn’t really diminish our argument,” he told Financial Director. “We want Europe to succeed, and we definitely want the euro to succeed. But for very good business reasons we believe that the UK could do better staying out of it.

“Our economic cycle is much more in line with the US,” he explained.

“The percentage of the UK population who have mortgages means that we are much more vulnerable to interest rate changes, and there are things like the pension overhang in Europe. Last and by no means least, the driving force behind the euro is political – it aims to create a United States of Europe.”

 BUSINESS FOR STERLING GROUP
 COUNCIL MEMBER           COMPANY        EUROPEAN TURNOVER (% OF TOTAL)
 Sir John Craven          Lonrho         15% "Europe and other"
 Lord Wolfson of
 Sunningdale              GUS            14% "Western Europe"
 Lord Hanson              Hanson         15% "Other"
 Sir Stanley Kalms        Dixons         3% (European property division)
 Lord Sainsbury of
 Preston Candover         J Sainsbury    0% Europe
 Source: annual reports.