European Financial Stability Mechanism

Lord Willoughby de Broke Excerpts

Thursday 12th May 2011 Lords Chamber

Asked By

[Lord Willoughby de Broke]

To ask Her Majesty’s Government whether, in the light of the constitutional convention that no Parliament may bind its successor, they will review the commitment made by the previous Government to participate in the European financial stability mechanism.

[The Commercial Secretary to the Treasury (Lord Sassoon)]

My Lords, the constitutional question is a red herring in this case. The Government are focused on looking ahead. At the December European Council, the UK secured an agreement for the European stability mechanism to be replaced, by 2013 at the latest, with a permanent mechanism for assisting eurozone countries. The UK will not be participating in the permanent mechanism.

[Lord Willoughby de Broke]

My Lords, I am grateful to the Minister for that reply, and I am sorry that he thought that part of my Question was a red herring. I will try a fish of a slightly different colour. I remind him that at the Davos economic forum President Sarkozy of France said:

“To those who would bet against the euro, watch out for your money … Mrs Merkel and I will never—do you hear me, never—let the euro fall”.

Given that unambiguous recognition that the eurozone ought to be able to sort out its own problems, will the Government now stop pouring good money after bad and give notice that they will withdraw from the European financial stability mechanism?