Greece

Chris Leslie Excerpts

Monday 6th July 2015 Commons Chamber

[Chris Leslie (Nottingham East) (Lab/Co-op)]

Yesterday’s referendum in Greece presents the European Union with the most fundamental test that it has faced for a generation. Although the Greek people have given their backing to their Government, that does not overrule the position of other elected eurozone Governments who are now faced with an incredible dilemma. It is imperative for the Greek Government and their creditors to sit down and plan for an orderly and pragmatic way forward, and to avoid impulsive and precipitate steps that could spark turmoil or chaos.

What are the Chancellor and Prime Minister doing to press both sides to find a new timetable and some breathing space, at least to allow planning for all eventualities to take place? Greece’s position in the euro and the European Union affects us all. Will the Prime Minister and the Chancellor actively engage with both sides of this impasse and do what they can to help reach an agreement? Is there more scope for proactive diplomacy, and will the Chancellor say more about the substance of conversations that he has had with Greek and other eurozone Ministers since last week’s statement to the House? The Chancellor needs to play his part. What is he saying to the International Monetary Fund, with whom we have direct influence, about emerging options for restructuring Greek debt? Last week the IMF signalled that an alternative analysis was necessary, so can he clarify what course the British Government are advising the IMF to take?

Let me ask the Chancellor about some immediate issues affecting the UK. Can he reassure the House that Britain’s financial system is properly insulated against risks emanating from a possible Greek exit from the euro? At a time of such heightened anxieties about banking across Europe, can he explain why today he has announced a reduction in the level of protection for bank deposits in the UK? What can be done to help British firms selling goods or services to Greece that might be awaiting payment because of the suspension of Greek banks? He did not mention UK Trade & Investment in his statement, but what changes are being made to its advice and assistance at this time?

The Chancellor mentioned the need for British tourists who are setting off on their summer holidays to ensure that they check advice from the Foreign Office, but can he reassure those who are travelling that the Government are working closely with tour operators and airlines so that travel arrangements are not adversely affected by disruptions to the currency in Greece? Can he give the House more details about the capacity of the embassy and consular networks to stand ready to help with the volume of inquiries that are likely to ensue?

Last night the President of the European Parliament called on European Union member states to prepare for a possible humanitarian intervention in the coming weeks, given that children and the sick and vulnerable in Greece may feel the strain of any volatility in the basic operations of a normal economy. How are the British Government responding to that? More broadly, will the Chancellor acknowledge what the Bank of England’s Financial Policy Committee has noted in recent months—that our wider balance of payments problems and widening trade deficit over the past five years presents a potential vulnerability that should not be ignored? The minutes of the last Financial Policy Committee meeting state that that

“could, in adverse circumstances, trigger a deterioration in market sentiment towards the United Kingdom.”

Wednesday’s Budget must do more to help our exports and productivity so that our economy is strong enough to cushion any external turbulence that may arise.

Finally, does the Chancellor agree that both sides of this stand-off still have much work to do? The eurozone countries need to do their best to offer Greece the opportunity to return to negotiations, and the Greek Government need to face up to their responsibilities for stronger governance and economic reform. These are serious times for Greece, for Europe and for the United Kingdom, especially if a disorderly chain of events now follows. I urge the Chancellor to do what he can to prevent that scenario from occurring, but to prepare fully in case it does come to pass.