Economic recovery under way says Major

The Conservative former Prime Minister said data showed the UK’s recovery had begun, with employment and the stock market rising.

He also urged Tory MPs to rally behind David Cameron amid mutterings about his leadership, and predicted a two-tier Europe within a decade.

Speaking on the 20th anniversary of Black Wednesday, which marked Britain’s
dramatic exit from the exchange rate mechanism, Sir John said the UK’s economic recovery was under way, despite
gloom surrounding the eurozone crisis.

He likened today’s UK economy to the early 1990s when Chancellor Norman Lamont was widely mocked for claiming he could see the “green shoots of economic spring”.

The ex-Prime Minister said: “Norman Lamont was taken to pieces by commentators for suggesting there were green shoots, but in retrospect we can see that Norman was right.

“Recovery begins from the darkest moment. I’m not certain, but I think we have passed the darkest moment.”

Sir John told BBC1’s Andrew Marr Show there were “oddities” in economic data. He added: “Why in the depths of this recession is employment growing? Why is industrial production going up? Why has the stock market risen?

“There are things happening out there that will become apparent and we don’t quite know why or how.

“My guess – and this is something a Minister can’t say but I can – is that in due course we will find that we have passed the bottom.”

Sir John, whose seven-year premiership was blighted by Conservative splits on Europe, said the eurozone crisis was pushing the 17 countries in
the currency union closer together.

He said the process could take up to 10 years and would spark a UK referendum on Britain’s relationship with the European Union.

“What you’re now seeing, out of failure and not success, is
the euro core looking to
 integrate further, much more towards a federal structure,” he said.

“That offers an opportunity for us to clean up one of the long-running sores of British politics, which is our relationship with the rest of Europe.”