Britain's tax payers to cough up extra 17.5 billion pounds to bail out euro zone

Irish Sun Thursday 19th January, 2012

LONDON British taxpayers will have to give an extra 17.5 billion pounds to help bailout struggling European countries after the International Monetary Fund announced that it needed more cash.

IMF boss Christine Lagarde said her organisation needs to raise another $600 billion to 'increase the fund's firepower'.

The UK contributes 4.5 percent of IMF resources, which means it would be expected to pay in another 17.5 billion pounds.

The IMF has announced plans to set up a $1 trillion rescue fund.

The British government is facing strong opposition to the move from many within the Conservative Party, riding on fears that Britain is in recession, a situation that could be confirmed when data is released next week..

According to the Telegraph, sources close to the Treasury said that Britain will try to limit its additional contribution to around 8.5 billion pounds and demand strict conditions from Europe.

The newspaper said that the government has already got permission from Parliament to hand out up to 10 billion pounds but could have trouble getting approval for any more.

Peter Bone, Conservative MP, said ministers would face a "good deal of trouble" in any vote on increasing the IMF contribution. "My view, and I think of a number of other Conservative MPs, is that enough is enough," he said.

Treasury sources said Chancellor George Osborne would resist calls to put in more cash until the euro zone does more to help itself, and will only act if America, China and other major IMF donors help out.

The announcement came as Prime Minister David Cameron met with Italian Prime Minister Mario Monti following the downgrading of the credit rating of Italy and eight other euro zone states, as well as the EU's bailout fund.

The Mayor of London Peter Bone warned that Europe's economic problems would not be solved by "endlessly bubble-gumming" it together with extra money.