Backbench trouble after Osborne hands IMF £10bn

George Osborne faced fury from the Tory back benches after announcing Britain is to commit another £10bn to the IMF.

The Chancellor said it was vital to protect jobs and growth in this country.

But Conservative Peter Bone branded the move “bonkers” and said the money would be wasted trying to prop up the eurozone. The Wellingborough MP also complained that the level had been set to avoid triggering a Parliamentary vote.

Hide Ad
Hide Ad

Finance Ministers and central bank governors struck the deal at a meeting in Washington.

Alongside the UK’s increase, Australia is to contribute an extra $7bnUS, Singapore $4bnUS, and South Korea $15bnUS.

Mr Osborne said: “The UK sees itself as part of solution to the challenges facing the global economy, not part of problem. We are helping to solve the global debt problem rather than adding to it.

“Jobs and growth in Britain depend on stable world economy. That needs a strong IMF.

Hide Ad
Hide Ad

“And because we have taken strong action to rescue our own economy, we can be one of many countries that can support the IMF, instead of being bailed out by the IMF.” The United States and Canada are not thought to be contributing any extra funding under the agreement.

Parliament has previously approved around £40bn in support for the IMF, of which about £30bn has already been committed.

If the increase had gone beyond the £10bn “headroom” still available to Mr Osborne it would have required a fresh vote by MPs.

Committing money does not mean it will necessarily be drawn against and, because it would be given in the form of a loan, it would not deplete public spending budgets.

Hide Ad
Hide Ad

Mr Bone said: “It is £10bn of money that he is spending without telling Parliament in advance he was going to do it.

“It seems to me it is all about bailing out the eurozone. It should not be up to British taxpayers to shore up a doomed project that is for the benefit of our European colleagues.

“People will not understand how we can have all these cuts but put £10bn at risk for other countries. It is bonkers.”

However, Mr Bone said there was now no obvious way of forcing a Commons vote on the issue - which could have been highly embarrassing for the Government.

Hide Ad
Hide Ad

“It does seem very strange that £10bn can be spent without getting a proper Parliamentary debate,” he added.

Tory MP Mark Pritchard, secretary of the 1922 Committee, said Mr Osborne appeared to have “got away with the politics” of the issue by avoiding a fresh vote.

He said the UK should not be underwriting a currency that “clearly is not working”.

“Indirectly that is exactly what British taxpayers’ money and IMF funding is going to do,” he added.

He also pointed to wider disaffection on the Conservative backbenches. “The Government is suffering from strategic drift,” Mr Pritchard said.

Related topics: