Douglas Carswell's Blog

How did we end up in the Euro debt union?

Like me, perhaps you were a little miffed to discover that non-Euro member Britain turns out to be liable for Euro zone debts.  Despite keeping out of the currency union, we’ve somehow got ensnared in the Euro debt union. 

How did this happen?

The key deal, making the UK liable for the Stabilisation Mechanism, was done in May last year, after the old Parliament was dissolved, but before the new one got going.

Out-going Chancellor, Alistair Darling, negotiated the deal on May 9^th, during the General Election. 

But there is more to it than that.

Convention means government cannot embark on new policy between Parliaments. And indeed, we know that Mr Darling consulted George Osborne before he went ahead and signed Britain up. 

So, what did those Darling consulted have to say about the deal?  A firm “no”, perhaps, on the basis that we had to deal with the deficit ahead of bailing out the Euro?  Or did they nod along with established Treasury policy?

According to the reply I’ve just got from an FoI request, “the parties did cooperate with one another”. And “with senior civil servants” too.  Although they won't tell us what approval was actually given. 

Seeing how Parliament had not approved the deal, incoming ministers must have known that they could have quashed the whole Darling deal, had they sought to. 

Read the reply for yourself.  It sounds to me that they won’t let us read what incoming Coalition ministers actually said because they fear it might just look a bit embarrassing – or in Sir Humphrey-speak “the context here deserves special consideration”.

We keep being told that Britain will only face massive Euro bailout liabilities until 2013. But if ministers had been a little savvier on day one, we’d not be liable for the debt crashes about to happen in Spain, Portugal, Greece and Ireland in 2011 and 2012.

If I am wrong, ministers should publish details of the advice that they were given and the instuctions that they gave. 

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