MEMBERS of the Swindon business community have praised Chancellor Gordon Brown's decision to delay British membership of the euro.

Addressing the Commons yesterday, Mr Brown said there could be clear benefits to the economy from joining a single currency but Britain is not ready to join the Euro.

He said not all of his five economic tests for membership had yet been met and further major economic reforms are needed to achieve this.

Dennis Grant, chairman of the Swindon Chamber of Commerce, said: "It is good news that we are moving in the right direction and warming to the idea of the euro."

He said he believed eventually joining the euro would boost manufacturing industry and safeguard jobs, but he thought it was wise to avoid rushing into it.

"It would remove tariff barriers which cause trade difficulties," he said. "At the moment our currency is continuously fluctuating, but the euro would take away this guessing game and stabilise the supply chain."

He stressed the need to break down trade barriers because many British manufacturers now import components.

"We are already exposed and vulnerable," he said. "In the past 10 years, manufacturing has slumped 23 per cent. So in terms of business, the sooner we join the better. But given the wider economic picture, Mr Brown is wise to hold back."

If a positive Treasury assessment of the five tests is made next year, Mr Brown said the issue could be put to the British people in a referendum.

He announced publication of a draft Referendum Bill this autumn and the introduction of further paving legislation, enabling preparations for joining a single currency to continue.

In addition to his decision on the euro, Mr Brown announced proposals on reducing tariffs, regulation and EU-US trade.

He estimated that lower transaction costs from joining the euro could benefit businesses by about £1 billion each year. Reduced exchange rate volatility could bring gains for both large and small companies and there would be the benefit of greater cross-border trade.

Alex Bannister, group economist at Nationwide Building Society, based in Pipers Way, Old Town, also welcomed the decision.

He said: "If we joined now we would be risking a housing boom because of the sensitive interest rates. The delay is therefore a prudent measure."

Preparations for the euro may include introducing longer term fixed mortgage rates.

Mr Bannister expects Britain to enter the euro in 2005, when such adjustments are in place.

MPs also backed the chancellor.

Julia Drown, who represents South Swindon, said: "It's a policy I'm comfortable with because, while it's right that the people of Britain should decide in a referendum, I'm not at all excited about the euro.

"It feels right to me that we take the economic assessment seriously. The Chancellor laid out how the euro could benefit Britain, but not at this time.

"The effect on stability and jobs is essential and we can't go forward until our economies are similar enough to other European countries."

Michael Wills, a junior home office minister, who represents North Swindon, said: "This shows the careful and pragmatic way that we are approaching this very important decision, in contrast to the dogmatic, anti-European approach of the Tories."