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Britain to resist contributing to Greek bailout

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British Finance Minister George Osborne is to seek to block any move by the European Union to include British money in a new bailout programme for Greece, according to reports on Tuesday.

[LONDON] British Finance Minister George Osborne is to seek to block any move by the European Union to include British money in a new bailout programme for Greece, according to reports on Tuesday.

Osborne held a series of telephone conversations with his counterparts ahead of a meeting in Brussels in Tuesday to underline Britain's opposition to participating in a bailout, the Financial Times and other media reported.

"Our eurozone colleagues have received the message loud and clear that it would not be acceptable for this issue of British support for eurozone bailouts to be revisited," a source in Britain's Treasury said.

"The idea that British taxpayers' money is going to be on the line in this latest Greek deal is a non-starter." In 2010, Prime Minister David Cameron announced that he had reached an agreement that an emergency fund involving all 28 members of the EU, the European Financial Stabilisation Mechanism (EFSM), would no longer be used to underwrite bailouts of eurozone countries, after it was used to assist Ireland and Portugal.

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Instead, only the 19 members of the single currency should have the responsibility to underwrite bailouts, with a new fund set up to be ready for use in case of crises like that in Greece.

However, British media on Monday reported that European Commission President Jean-Claude Juncker proposed to revive the EFSM fund to use as collateral against short-term loans to Greece.

A spokesman for Mr Cameron's Downing Street office said the prime minister believed that the original agreement stood and that the EFSM would not be used again.

"Leaders from across the EU agreed in 2010 that the EFSM would not be used again for those in the euro area, and that remains the prime minister's view," the spokesman said.

"We have not received a proposal and one is not on the table." Mr Cameron has promised a referendum on Britain's membership of the EU before the end of 2017, in response to rising support for the anti-EU UK Independence Party and pressure from the eurosceptic wing of his Conservative Party.

A poll in March by NatCen Social Research showed that 35 per cent of British people wanted their country to leave the EU, compared to 57 per cent who wanted to remain within it.

Eurozone leaders on Monday struck a deal to stop debt-stricken Greece from exiting the euro, in return for a pledge by Athens to enact severe reforms in the coming days.

AFP

Read more on the Greek crisis here

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