Germany has confirmed it drafted proposals to intervene directly in the Greek budget if it consistently fails to implement reforms.
European sources confirmed the plan yesterday, saying "several ideas are being discussed on how to react to a programme which is consistently off-track".
"If the Greeks aren’t able to succeed themselves with this, then there must be stronger leadership and monitoring from abroad, for example through the EU," said German economics minister Philip Rössler, the first member of chancellor Angela Merkel’s cabinet to confirm the proposal to appoint a "budget commissioner".
"We need more leadership and monitoring when it comes to implementing the reform course." Though the proposals would apply to all programme countries with a backed-up reform programme, the paper is focused on Greece as it struggles to cope with its €350 billion debt mountain.
Amid repeated failures to meet the terms of its current programme, agreed with EU partners, Athens is currently negotiating a second €130 billion package and a debt restructuring plan with its private creditors.
The German plan, leaked to the Financial Times , says that, "given the disappointing compliance so far, Greece has to accept shifting budgetary sovereignty to the European level for a certain period of time."
European officials say a central problem is Greece's decentralised budget structure, which makes it "near-impossible for Athens to exercise fiscal discipline".
http://www.irishtimes.com/newspaper/breaking/2012/0129/breaking1.html?via=rel
Poll
