The coalition government made a total of £6.2 billion of savings domestically in its first year. Parliament should not reverse that by accepting commitments twice as big to bail out a currency we did not join.
MPs agreed in December to use around half of those savings to make a £3.2 billion loan to Ireland – subject to it being repaid in sterling under terms that provide for Ireland to leave the Euro.
Tomorrow MPs will decide whether we should accept further liabilities as proposed by the EU and the French-led IMF. These would take our Euro bail-out commitments to £12.5 billion, double the savings we have so far made domestically.
I do not believe that is something which we can justify to our constituents. Even the £12.5 billion sum, itself around £500 per household, is only for Greece, Ireland and Portugal, with potentially billions more to come for other countries in the Euro.
The EU has already had a substantial increase in Britain's net budget contributions: up 74% on last year to £9.2 billion under legislation agreed by Labour and therefore a legal obligation under the EU unless we vote otherwise. The bail-outs are a different matter since they are expressly prohibited under the EU's no-bailout clause.
Most of the money would go through the European Financial Stability Mechanism (EFSM) and our House of Commons committee has ruled that this is illegal under EU law. My motion tomorrow seeks to confirm that as the view of the whole House.
If so, Parliament would require the government to withhold payment in respect of any liability wrongly accrued for us through the EFSM. Crucially, my motion also provides that the EU must accept this – or the UK government will veto any permanent bail-out arrangement proposed for the Euro.
I hope that this will attract support from all MPs who wish to uphold the principle that only the House of Commons may approve expenditure of our constituents’ money.