Britain scraps euro preparation plans

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Finance Minister George Osborne scrapped a government unit tasked with preparing for Britain's hypothetical entry to the eurozone Tuesday, as he unveiled the new coalition government's first budget.

Osborne reaffirmed the committment by Prime Minister David Cameron's Conservative-Liberal Democrat government not to join the eurozone in the next five years and said resources would no longer be wasted on planning for it.

"I can confirm that, as set out in the coalition agreement, this government will not be joining the euro in this parliament," he told lawmakers as he unveiled a tough austerity budget just over a month after taking power.

"Therefore ... I have abolished the Treasury's euro preparations unit -- yes, one does exist -- and the official concerned has been redeployed to more productive activities."

His comments drew a wry smile from Deputy Prime Minister Nick Clegg, the Liberal Democrat leader and long-time advocate of Britain joining the euro who had to abandon his hopes when he went into power with the eurosceptic Tories.

© 2010 AFP

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