European finance ministers are meeting today to discuss a request from Portugal to provide financial assistance to the country following previous ‘bail-outs’ of Greece and Ireland. The Treasury has failed to make clear so far today whether any UK contribution will be limited to that which may be entailed by our membership of the IMF or whether, indefensibly, it is proposed to use the EU natural disasters Mechanism.
I believe that the British taxpayer should not contribute to an EU bail-out for Portugal and that the Leader of Conservative MEPS, Martin Callanan, with Parliament in recess, speaks for the Party on this when he said that the UK should refuse to accept any liability for Portugal under the EU Mechanism.
Article 122 of the Lisbon Treaty states that other member states may be expected to help when another state experiences “difficulties caused by natural disasters or exceptional occurrences beyond its control”. The chronic issue for Portugal is that it has only been able to grow at 0.7% per year since joining the Euro and has failed to control it’s spending, so Article 122 cannot apply to this situation.
This is a matter for the Eurozone and I cannot see any basis whereby we could properly use the Mechanism to bail-out Eurozone countries. To use the Treaty this way is simply not lawful. Britain decided not to join the Euro, so we should not be asked to bail-out countries that did join. I don’t see how we can ask the British taxpayer to prop up a supranational European currency they do not want and they did not ask for.