Lord Higgins
Main Page: Lord Higgins (Conservative - Life peer)
Lord Higgins
To ask Her Majesty’s Government what part they have played in discussions and negotiations regarding the Greek financial crisis.
Lord Ashton of Hyde (Con)
My Lords, these discussions are primarily a matter for Greece and for the euro area. However, it is in Britain’s interest to see a stable euro area, and the Government maintain regular contact with euro area member states and other European and international partners on economic issues. As the Chancellor has said, we should not underestimate the impact that a Greek exit from the euro would have on the European economy and the knock-on effects on us.
May I also take the opportunity to correct an error that I made in answer to a question after the Statement on Monday? I said that the UK’s share of IMF funding was 15%, whereas it is around 4.5%. I apologise to the House for that error.
Lord Higgins (Con)
My Lords, in light of that reply, will my noble friend urge the Chancellor to play a more active role in this matter? It is fortunate that we are not members of the eurozone; however, we have a definite interest in what the eurozone is doing. Not only are we contributing to the bailout through the IMF, but it crucially affects our own economic recovery. The politics of this have become unbelievably acrimonious and complicated, but the economics are very clear. Greece is locked into an uncompetitive exchange rate and it will be condemned to endless financial crises, bailouts and austerity until it leaves. Therefore, will the Chancellor seek to do all he can with our European partners to ensure an orderly exit? In particular, will he reject the view, apparently expressed this morning, that if Greece leaves the eurozone it has to leave the European Union, which would push it into Mr. Putin’s arms? Will he also say that the finance that would otherwise be available should be used to ensure a smooth transition to a more competitive exchange rate for Greece?