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Saturday, 31 July 2010

British Taxpayers to Bail Out Euro with £43 Billion Tax Bill

British Taxpayers Lumped with £43 billion Bill to Save the Euro

Britain’s share of the €440 billion EU European Financial Stability Facility (EFSF) euro rescue fund will be of the order of £43 billion, it has emerged.
The EFSF’s rescue fund for the single-currency region is now operational after Italy's parliament approved the programme yesterday.
The plan allows EU member states to issue guarantees for any debt raised by the EFSF, which is then lent to governments having difficulty borrowing on the markets themselves.
The rescue plan was formulated after the Greek crisis threatened to collapse the entire euro-zone after that nation’s government defaulted on its national debt repayments.
The EFSF was agreed by the 27 member states of the European Union on 9 May 2010, aiming specifically at “preserving financial stability in Europe by providing financial assistance to eurozone states in difficulty,” according to its founding documents.
The EFSF will sell bonds, notes or other debt instruments on the market and use the money raised to make loans up to a maximum of €440 billion to euro area member states in need.
The bonds will be backed by guarantees given by the euro area member states on a pro rata basis, in accordance with their share in the paid-up capital of the European Central Bank.
In terms of this ratio, Britain’s contribution is likely to be in the region of £43 billion — even though this country is not even a eurozone member.
The EFSF agreement was signed after the general election and was signed by the former chancellor Alistair Darling while the Conservative Party and Liberal Democrats were still in coalition negotiations.
The ConDem’s commitment to the EU, which totally negates the Tory’s election promise to “roll back” the EU’s powers, means that the agreement to pay for the EFSF will still be in force no matter what.
Meanwhile at home, British government departments have been ordered to make spending cuts of up to 25 percent.
The latest casuality will likely be some 60,000 Scots who face redundancy from the public sector as spending cuts bite.
Once again, the ruling elite has put the interests of other nations before those of Britain and the British people.