CHANCELLOR George Osborne has said that Britain will be free of its commitment to fund Eurozone bailouts by 2013, even as the European Council (EC) meets today to negotiate the legal basis of a permanent bailout fund.
The EU summit comes as the Irish parliament voted yesterday to accept the terms of the €85bn (£72bn) EU/IMF bailout. The vote underscored Prime Minister Brian Cowen’s fragile grip: the bailout passed 81-75, with the governing coalition relying on the support of three independent MPs. Opposition parties have sworn to renegotiate the bailout if they win next year’s elections.
Osborne announced that Britain stands to make £440m from interest on its £3.25bn bilateral loan to Ireland.
But he also assured parliament that he has struck a deal to free Britain from its participation in Eurozone bailouts once a permanent fund is established in 2013. The UK is obliged to contribute up to €7bn for any bailouts until then under the terms of a deal negotiated by former-chancellor Alistair Darling.
The European Council meets today and tomorrow to alter EU treaties in order to establish a permanent fund.