British ex-chancellor turns against euro

In an interview with the Central Banking journal, he said he had previously thought the single currency "would lead to increased productivity, efficiency and living standards and stimulate policy reforms".

"On that front so far it has been a failure", said Mr Clarke adding that he had doubts about Britain joining the single currency in the next few years.

"I do not think there has ever been a time when the British could have joined with complete security and confidence. I doubt it is possible for 10 years or more", he said, suggesting the euro zone's "one-size fits all" interest rates were causing severe difficulties, mainly in southern Europe.

"I think many people would agree that the ECB has to rethink the role it plays in the economic life of the nations it serves," said the Tory candidate.

He also remarked the European constitution is "effectively dead" following the rejection of the document by French and Dutch voters earlier this summer.

"There is no way of rescuing the treaty - although I was in favour - and the sooner we can make a reality of economic reforms in terms that are seen by the public as contributing to their economic wellbeing, the better".

The Tories are expected to kick off the competition for a successor for their current leader Michael Howard after their party conference in October.

David Davies, the shadow home secretary, is the favourite to win the race, but Mr Clarke is still in with a chance, according to analysts, if some current runners were to drop their candidacy and back him.