Gordon Brown has said that the UK may face a new obstacle to euro entry, after EU finance ministers agreed on sweeping plans to rewrite its Stability and Growth Pact.

Speaking on his return from a Brussels summit of EU finance ministers, the chancellor indicated that the new target under which members must keep borrowing below one per cent of national income over the medium term would make it even harder for a Labour government to join the euro whilst retaining key domestic policy objectives.

At a Labour party event on Monday, Brown said: "We insisted that we would not allow the UK's plans for investment in the long-term growth of our economy to be undermined or jeopardised by new Commission guidelines or rules."