The Public and Commercial Service Union says the decision is a vote of confidence in the Mint at Llantrisant in south Wales.

John Sheldon, joint general Secretary of the Public and Commercial Service Union says, "If these reports are accurate, the news will be welcomed by staff at the Royal Mint. It puts an end to months of uncertainty and is a great vote of confidence in the public sector."

Privatisation "shelved"

Government sources are reported as saying the privatisation proposals have been shelved because of committments to the production of EURO coins in the new millennium.

Privatisation had been facing stiff opposition from trade unions and a group of senior Labour politicians.

The stumbling block to the deal is the government's determination to take the UK into European economic and monetary union.

Mint in profit

The task of minting sufficient euro coins to ensure that the changeover from sterling was considered too delicate to be given to a single private sector supplier.

The introduction of private capital into the Royal Mint was one of three "public-private partnership" initiatives announced by the chancellor in June 1998.