UK will not face bill or Greek bail-out

Britain will not be contributing directly to a European bail-out of Greece and the move will not lead to the ceding of any powers to Brussels, Prime Minister Gordon Brown said.

Leaders of the 16 eurozone countries have endorsed a bail-out pledge for the Greek economy but Mr Brown stopped them from declaring a commitment to an "economic government of the European Union" as part of the process.

Speaking at the end of a two-day summit in Brussels yesterday, Mr Brown said he was "encouraged that the eurozone is meeting its responsibility".

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And he added: "I can reassure people in the UK that we are not contributing directly to this and that none of these arrangements will see any powers being ceded from Britain to the EU."

The final summit communique will refer to EU economic "governance" rather than "government", after British objections the initial wording implied the creation of new institutional structures, which would have been deeply controversial in the UK.

The pledge, not formally signed by the 11 EU countries outside the eurozone, includes a declaration that EU Council President Herman van Rompuy will head a "task force" from the member states and the European Central Bank to look at "all options" to achieve the legal framework for economic governance – which could mean EU Treaty changes.

European Commission President Jose Manuel Barroso said the bail-out pledge "shows our solidarity by offering a safety net to Greece and stability to the eurozone".

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"I hope that the financial markets act now on fact, not on fiction."

The hope is the pledge will never be invoked, that the declaration of a safety net will be enough to rally investor support for the euro and end its slide.

The non-eurozone nations, including the UK, will not be asked to contribute to any bail-out, but have also formally approved the terms of the deal.

The document does not mean the immediate activation of a new bail-out scheme, following German Chancellor Angela Merkel's insistence that Greece should only be bailed out as a last resort.