Britain rules out financing Greece bailout, according to source

Britain rules out financing Greece bailout, according to source

British finance minister George Osborne has ruled out any financial involvement in a fresh bailout for Greece after suggestions that a mechanism backed by the whole European Union could provide bridge financing for Athens.

Osborne spoke to some eurozone finance ministers on Monday as they set about exploring ways to provide Greece with an interim loan while it thrashes out a third bailout deal to avert bankruptcy.

His intervention was designed to quash the idea, one of several under consideration in Brussels, of using the European Financial Stabilization Mechanism — a bailout fund created in 2010. The EFSM issues bonds backed by all 28 European Union members and was used to help Ireland and Portugal.

"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 British finance ministry source told Reuters.

"The idea that British taxpayers money is going to be on the line in this latest Greek deal is a non-starter," said the source, who spoke on condition of anonymity.

One EU official said this EFSM option "was very unlikely to gain ground" and would likely not be discussed at Tuesday's meeting of all 28 EU finance ministers.

In 2011, Britain refused to allow the use of the EFSM to bail out Greece for a second time.

London could be outvoted on the issue, because the use of the EFSM can be decided by a qualified majority of EU states. That is 15 countries representing 65 percent of the EU's population. But EU institutions will be wary of angering British voters ahead of a referendum on Britain's EU membership by 2017.


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