We won't win the battle by conceding euro-sceptic arguments

John Monks

He also called on the prime minister to be more active in winning the political argument over the euro.

Mr Monks told the party's conference that the UK was faced with a choice: the deregulated capitalism of the the US or the European approach which balanced productive economies with workers rights.

He said: "No successful economy has managed without either the discipline the market imposes or the energy it unleashes.

"But that is not the end of the matter. For the fundamental choice is now about what kind of capitalism we want.

"Is it the deregulated wild-west devil take the hindmost style of the US? This is clearly the Conservative option.

"Or is it the European approach? This combines productive economies with good welfare states, rights for people at work and environmental protections.

"It's a choice between an economy that serves the people, or one where people serve the economy - and if they can't that's just too tough."

Mr Monks - whose organisation, the Trades Union Congress, is made up of the UK's mainstream unions - called for a committed approach to both Europe and the single currency.

Veiled attack on Blair

In what will be taken as criticism of Tony Blair's government, he told the conference that the only way to sway public opinion in favour of abandoning sterling was by winning the political as well as the economic argument.

The prime minister has often faced criticism for failing to argue the case for the euro strongly enough, and for insisting that the political issues over entry have already been settled, leaving only Chancellor Gordon Brown's five economic tests to be met.

Poking fun at Mr Blair's New Labour, Mr Monks said: "Britain's unions can claim to be Labour's parents, although a DNA test might show that other genes somehow got into the conception."

But he added that the TUC wanted and had "good relations with this government" and wanted good relations with all parties - although he said he did not hold much hope for the Tories.

On Europe, Mr Monks also argued that the only the EU could stick up for workers, communities and the environment in the face of the changing global economy.

But Mr Monks warned that the EU "must be a people's Europe and not just a Europe for bankers, boardrooms and bureaucrats".

Europe has good and bad aspects - Monks

Despite his enthusiasm, Mr Monks admitted that there were aspects of Europe that trade unions did not like and he accused the European Central Bank of being "too wedded to economic orthodoxy".

He said: "But we know it comes as a package. We can't pick and choose.

"And we must expect all those who want to play a part in the campaign to join the euro to play the same rules.

"We won't win the battle by conceding euro-sceptic arguments," he added."

He told the conference that the Liberal Democrats were on the same side of the argument.

And he had warm words for the party, reminding them that the first trade union MPs were solid Liberals before the Labour Party had been born.