UK ready to cough up for IMF billions

BRITAIN will contribute billions to boost the firepower of the International Monetary Fund (IMF) alongside other shareholders, chancellor George Osborne told MPs yesterday.

Significantly, he refused to rule out the idea that the UK could cough up more in proportion to its 4.5 per cent shareholding of the fund than other countries.

In fact, with the IMF’s biggest shareholder, the US, having ruled out any further contribution, it is likely that Britain would have to shoulder more of the burden.

Osborne said: “Britain is prepared to make additional contributions to the IMF alongside other shareholders… We are enthusiastic supporters of a well-resourced IMF.”

He added: “As far as I know, I was the first finance minister in the world to suggest additional IMF resources.”

The chancellor proposed that China and Russia might give more alongside the UK.

The government can spend up to £10bn on beefing up the IMF but in order to throw in any more it must gain parliamentary consent.

That could prove difficult, with Labour MPs promising to team up with Conservative rebels to veto any additional spending that they see as a way to bail out the Eurozone by the backdoor.

Osborne has said that he was also against such a use of IMF funds, although it is not clear if he will be able to deliver guarantees that will satisfy his political opponents.

“We want to make sure that that money was going into the general resources of the IMF and we want to make sure – as was clear in Cannes – that it is not a substitute for the Eurozone also taking action to deal with the stability of its own currency,” he said.

The Eurozone tried to bounce the UK into signing up for a massively increased contribution last month so as to use the IMF as a way to extract cash from non-Eurozone members for a €200bn (£165.7bn) increase in IMF firepower. But Britain refused to play any part in the agreement.

The scheme formed part of an increasingly torturous set of proposals as to how the Eurozone technocrats could channel money from richer countries to bankrupt countries without incurring too much wrath from their voters.