The former UK Government under Labour stated that it would recommend EMU entry when the economic conditions were met. It announced policy changes to align economic conditions in the UK to those in the euro zone.  The then Chancellor, Gordon Brown, announced no change to the UK's position in the 2004 Budget. He ruled out a further assessment of progress against the economic tests that year but was due to revisit the issue in 2005. In fact not much seems to have happened in policy terms since the referendum bill was published in on 10th December 2003. The referendum question was proposed to be "Are you in favour of the UK adopting the euro as its currency? "

You can see more analysis and information on our Euro blog page, but we stopped making monthly updates after late 2009 as the direction of travel was by then very clear.

Ten new countries joined the EU on 1st May 2004. The accession treaty obliges them all, sooner or later, to join the single currency, but the timing is left to the individual states.  By 1st Jan 2011, five of them had joined; see EMU expansion for further details. Meanwhile, in the UK, public sector preparations have advanced, while the private sector has spent its money carefully, if at all.

The referendum that Labour promised on the EU constitution would have been a critical test of UK public attitudes to the European project, but that never happened. The Eurozone economic crisis reduced the possibility of UK Euro membership even before the 2010 General Election. 

The coalition Government formed in May 2010 has pledged not to join EMU for the lifetime of the parliament, despite the policy aim of the Liberal Democrats to join the ERM II Exchange Rate Mechanism and eventually the euro. 

The referendum on Scottish independence on 18th September 2014 voted No.  The Scottish National Party is expected to press for another referendum if it has an influential position in the UK Parliament after 7th May 2015. The SNP's reported position is that an independent Scotland would remain within the Sterling zone.  However, the whole legal and economic status of a separated Scotland remains uncertain, including even its continuing membership of the European Union.  If it had to reapply, it might not benefit from the same EMU opt-out that applies to the remaining United Kingdom.

A referendum on the future of the UK's EU membership may also happen within a couple of years of the General Election to be held on 7th May 2015.  So a possible scenario is that Scotland might join EMU while England, Wales and Northern Ireland leave the EU.

EMU is a business issue with an IT impact. It affects every financial process, transaction and information store.  The Payments Services Directive came into force in 2009, and has significant effects on euro payments operations. 

In particular, the Single European Payments Area (SEPA) will demand the use of common XML-based formats for payments and direct debits in EUR by banks and corporates.  The deadlines are 01/02/2014 in Eurozone countries and 31/10/2016 in non-Eurozone countries.