Prime Minister David Cameron has promised that UK taxpayers will not have to aid the bailout package the EU is granting Greece.
Speaking at a conference organised by The Times newspaper, Mr Cameron promised to fight ‘very hard’ against Britain having to contribute to the package at the European Council meeting this week in Brussels.
EU finance ministers will not grant Greece a second bailout package of 12 billion Euros unless it agrees to a set of austerity measures that would amount to 28 billion Euros, which would involve huge tax rises and public services cuts across the country.
In a statement issued by Downing Street, the government does not believe it will be asked to contribute to the package, and that only the other 17 members of the Eurozone will be asked, that is the nations that use the Euro as their chief currency. Problems will certainly arise for Britain however if it is decided that the bailout package will come from the International Monetary fund, which Britain is a major shareholder of.
Last month a number of Tory MP’s called for there to be no bailout money contributed by Britain to the Greek rescue fund. John Redwood, a Conservative MP and former minister, said ‘those of us who made the case to keep Britain out of the Euro did so because we didn’t want Britain to have to pay the bills for its failure’.
With a general trend in Southern Europe of poor growth, the Eurozone is something many economists in Britain will be glad they are not part of.
However with so many associate nations struggling it is felt that it is in Britain’s interest to secure the Euro and not see it deteriorate and diminish. David Cameron’s promise to fight against having to contribute to a bailout package then, is something that may make more public relations sense than economic.