Britain 'to veto banking union'

UK Political Editor

Wednesday 13 June 2012

DOWNING Street yesterday signalled that Britain would veto any attempt to create a banking union across all 27 EU member states.

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MICHAEL SETTLE UK POLITICAL EDITOR

The move was a riposte to Jose Manuel Barroso, President of the European Commission, who suggested the time was right for a "very big step" towards greater integration. He acknowledged Britain could be allowed to opt out of a banking union so long as it did not block its progress.

Prime Minister David Cameron and Chancellor George Osborne have made clear they believe a banking union should be restricted to the 17 nations that use the single currency. They do not want British taxpayers to be liable in any way for recapitalising eurozone banks nor do they want British banks placed under an EU supervising authority. The issue was raised at Cabinet yesterday when ministers were assured there were contingency plans in place for any fallout from the re-run Greek elections this Sunday.Asked if Britain would have a veto if there were a push to include all 27 EU member states, a spokeswoman for the PM said: "Anything affecting the single market has to be agreed upon."She added: "Should the eurozone want to have some sort of banking union or further fiscal cohesion, that's a matter for the eurozone but Britain would not be involved. If there is some sort of potential impact on Britain, then we will ensure our interests are protected and that the single market is similarly protected."As well as cross-border regulation, the banking union proposals also envisage an EU-wide deposit guarantee scheme and a rescue fund paid for by levies on financial institutions.Mr Barroso explained that the new arrangements could be in place by 2013 without changing existing European treaties.He said: "There is now a much clearer awareness among European member states about the need to go further in terms of integration, especially in the euro area. This is one of the lessons of the crisis."If Britain cannot, because they are not in the euro area, go for more integration, we should find a way where this is possible to accommodate these different concerns."It seems clear EU leaders are working towards an ambitious compromise at the June 28/29 Brussels summit.

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Britain 'to veto banking union'

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