Cameron: Eurozone 'will not fail'

21 June 2011 Last updated at 13:09 GMT Mr Cameron said he wished Greece well but the UK would not contribute to any further bailout The eurozone will not be allowed to collapse, David Cameron has said, since the countries using the single currency have so much "invested in it".

The prime minister said that for its 17 members, the eurozone was a "key part" of their national identities and they "will not let it fail".

It comes after former foreign secretary Jack Straw said the euro "cannot last" amid the Greek debt crisis.

The PM restated the UK would not take part directly in any Greek rescue.

As it is not a member of the single currency, the UK would not have to contribute to any further EU-wide bailout.

However, as a member of the International Monetary Fund it could be liable for a share of loan guarantees to Greece - and UK banks have an estimated ?2.4bn in investments tied up there.

National interest

Members of the single currency have said Greece must agree further austerity measures before receiving a further ?10bn, raising the prospect of the country defaulting on its debts should it be unable to do this.

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The countries that joined the euro have an enormous amount invested in it and do not want it to, and will not let it, fail”

End Quote David Cameron UK Prime Minister A growing number of UK politicians have said this is the best way to resolve Greece's long-term economic difficulties and the country should be allowed to leave the eurozone.

Former Labour Foreign Secretary Jack Straw has gone further, saying the euro was facing a "slow death" and the UK should accept that monetary union as a project could not survive in its current form.

But asked about the eurozone's future on Tuesday, Mr Cameron said he expected it to survive its current crisis.

"The countries that joined the euro have an enormous amount invested in it and do not want it to, and will not let it, fail," he said at a press conference in No 10.

"They see it as an absolute key part of their national interest and identities and I would not doubt their resolve in any way."

'Bad for Britain'

The Greek government wants a similar rescue deal to the ?68bn ($110bn) bailout it received last year.

However, eurozone finance ministers are awaiting the outcome of a series of votes in the Greek Parliament - the first of which is on Tuesday - before deciding whether to hand over the latest tranche of money.

Turbulence in the eurozone was not good for the UK, Mr Cameron stressed, since 40% of UK export trade was with countries using the single currency.

"Britain struggles when the eurozone struggles," he added.

"The consequences of severe turbulence (in the eurozone) could be bad for Britain."

The prime minister, who said he had always been "passionately opposed" to the UK joining the single currency, said he wished Greece well in its difficulties but the UK would not be participating in any financial rescue.

"The point about Greece that the chancellor and I have both made is we were not involved in the first bailout of Greece. It would be quite wrong now to bring Britain into this bailout."

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Cameron criticises G8 aid record

27 May 2011 Last updated at 14:35 GMT David Cameron said that Britain had kept its promises to deliver aid, "but the reality is, as a whole, the G8 has not"

The world's leading nations have not kept their promises on foreign aid, David Cameron has said.

Speaking at the G8 summit in France, the UK prime minister said there was a $19bn gap between what had been pledged and what had been delivered.

He vowed to be "tough" on world leaders over the issue and to continue to make the argument to the British people that foreign aid was vital to UK interests.

"The UK will not balance its books on the backs of the poorest," he said.

He was speaking after the UK pledged ?110m in additional support for Egypt and Tunisia as part of a ?20bn package of economic aid for countries in North Africa which have embraced political reform in the "Arab Spring" uprisings.

'Soft touch'

Before last year's UK general election all the main parties agreed that international aid should rise to 0.7% of gross national income by 2013.

But some Conservative MPs have questioned why the government is increasing foreign aid spending when most domestic budgets are being cut.

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I don't believe 0.7% of our gross national income is too higher a price to pay in terms of saving lives of the poorest people in the poorest countries”

End Quote David Cameron Backbencher Philip Davies told the Mail: "Once again we are the soft touch of the international community. We keep on spending money on foreign aid when we haven't got any money to spend on people at home.

"Every other country has accepted that spending money at home is better than spending money abroad."

The prime minister acknowledged the issue was "controversial" but said he believed it was a "moral principle" to help the world's poorest and was also in the UK's interest as it helped prevent wider instability and conflict.

'These things matter'

He said the UK would be the first country to fulfil the internationally agreed target for countries to spend 0.7% of their income on foreign aid by 2013.

"Britain will keep its promises and I was tough in urging my counterparts to do the same," he said. "The reality is that as a whole the G8 has not."

He added: "I cannot guarantee that the Italians or the Germans, or whoever else, will meet the promises they make.

"But I'll tell you what I think. I think what people back at home think about these summits is that frankly a bunch of people in suits get together and make some promises, particularly to the world's poorest, and then they go in and have a big lunch and forget all about the promises. I am not prepared to do that."

Recalling where he was when he watched the Live Aid concerts in 1985 and the Live8 events in 2005 - which were followed by substantial aid pledges at the G8 summit in Gleneagles - Mr Cameron said he would continue to make the case for foreign aid, even if it proved unpopular at home.

"These things matter," he added.

"If we are going to get across to the poorest people in the world that we care about their plight and we want them to join one world with the rest of us, we have to make promises and keep promises.

"Of course it is difficult when we are having to make difficult decisions at home. But I don't believe 0.7% of our gross national income is too high a price to pay in terms of saving lives of the poorest people in the poorest countries."

In their declaration at the end of the two-day summit, G8 leaders - including US President Barack Obama and French President Nicolas Sarkozy - said their nations were "strongly committed" to meeting overseas aid commitments.

But development charity World Vision said their record was not encouraging.

"The UK has led while the rest of the G8 has responded with words and no action," said its spokesman Chris Page

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Cameron defies Clegg on Ashcroft

24 May 2011 Last updated at 16:08 GMT Lord Ashcroft was made a peer in 2000 David Cameron gave a government advisory post to Conservative donor Lord Ashcroft despite objections from Nick Clegg, the BBC understands.

The peer and former Tory deputy chairman will lead a review of the UK's military bases in Cyprus.

But he has come under fire from Labour and Lib Dem MPs, including the deputy prime minister, over his tax status.

A source said Mr Clegg made it clear he was "not keen" on the appointment, but the prime minister chose to go ahead.

In a statement, Defence Secretary Liam Fox confirmed that Lord Ashcroft would undertake the role of senior independent advisor to the review of the Cyprus bases.

He will work alongside Conservative MP and former Army officer Patrick Mercer.

Government sources say Lord Ashcroft's appointment is unpaid, short term and advisory only. The study, due to be completed by the end of 2011, is part of the strategic defence review.

More than 3,000 UK personnel are stationed in two bases, Akrotiri and Dhekelia, on the Mediterranean island.

'To the wall'

In the run up to last year's general election, Lord Ashcroft was the subject of fierce criticism from Mr Clegg.

The future deputy PM said it was "wholly wrong" that someone "seeking to influence the outcome of the general election" sought to pay taxes "only partially" in the UK.

The peer confirmed in March that he did have so-called "non-dom" status, but later renounced it in order to keep his seat in the Lords.

A non-dom is someone who is resident in the UK but not domiciled in the UK for tax purposes - although they will pay some UK tax, they will not be fully taxed in the UK on their interests overseas.

Following the announcement of Lord Ashcroft's appointment, a senior Liberal Democrat source told the BBC: "We knew about it, but we were not keen.

"The prime minister made it clear he really wanted to do this, but it was not the appointment we would have made.

"You cannot go to the wall on every single appointment, but we made it clear we were not keen."

Lord Ashcroft has donated more than ?4m to the party in recent years, much of which has been spent on campaigns by Tory candidates in marginal seats.

There had been speculation for a number of years that he was a "non-dom", but both he and the Conservatives had previously refused to clarify the matter.

He was appointed a peer in 2000 by then Conservative leader William Hague.

'Sinister'

Lord Ashcroft has longstanding connections with the military and was heavily involved in the Imperial War Museum.

He also owns the world's largest collection of Victoria Crosses - Britain's highest military honour.

But BBC News Channel's chief political correspondent Laura Kuenssberg said his appointment would inevitably be controversial, particularly among Liberal Democrat MPs, many of whom are now in government.

One of those angry at the decision was Lord Oakeshott, former Lib Dem Treasury spokesman in the Lords.

"Even [President] Obama's visit cant hide this sinister news, which Liberal Democrats will find deeply offensive," he told the BBC.

"Lord Ashcroft's qualifications for this task are his collection of old Victoria Crosses, years of private plane and yacht rides with William Hague, and a decade of vast Tory donations as a secret non dom.

"The government has still not brought in the simple order needed to ban non-dom donations to political parties under the 2009 Political Parties and Elections Act. The Queen's Speech promised to remove big money from politics, not reward big donors.

"What on earth is his hold over Cameron and Hague?"

For Labour, Shadow Defence Secretary Jim Murphy said: "People will be surprised that such a contentious and controversial character has been put in charge of something as strategically important as British bases in Cyprus.

"The Tories' major donor should not write government policy. Many in the Armed Forces will be bewildered by this decision.

"There needs to be ministerial involvement in this. Military expertise, not the self interest of the coalition parties, must drive the study."

The strategic defence review was announced by the government in October 2010 and set out ways to cut defence spending by 8% over four years.

Among the plans was a commitment to bring home some 20,000 UK personnel currently stationed in Germany by 2020.

The bases in Cyprus are used to give the UK a foothold at a strategic point in the Mediterranean, and the MoD describes RAF Akrotiri in particular as "an important staging post for military aircraft".

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Cameron 'settles emissions row'

16 May 2011 Last updated at 08:17 GMT By Roger Harrabin BBC Environment analyst Several ministers voiced concern that the competitiveness of British industry could be harmed David Cameron has moved to resolve a Cabinet row over the UK's climate change targets, with an agreement on emissions to be announced on Tuesday.

This will see drastic cuts in greenhouse gas emissions to 2027 and an overhaul of the way energy is produced.

But ministers worried about the impact on the economy and burdens on industry have secured a get-out clause.

The targets will be reviewed if European nations backslide on their own climate commitments.

The BBC understands the prime minister intervened after leaked letters showed a disagreement between energy and climate change secretary Chris Huhne and Lib Dem colleague, Business Secretary Vince Cable, on whether to accept the recommendations of the Committee on Climate Change on emissions cuts.

Serious disagreements

The official advisory body has urged the UK to accept a global agreement which roughly equates to an emissions cut of 50% - based on 1990 levels - by 2025.

The settlement - which will form part of the UK's fourth carbon budget - is being categorised as a victory for Mr Huhne but the BBC understands the Treasury, the Department of Business and the Department of Transport refused to sign up to the deal without the get-out clause.

The agreement was due to have been finalised at the Cabinet's Economic Affairs sub-committee on Monday but disagreements were so serious that negotiations were concluded outside the committee.

It is understood that Cabinet Office minister Oliver Letwin played a major role in negotiations while the prime minister personally intervened to broker a final agreement.

Mr Cameron is already under fire over environmental policy with critics saying he has failed to keep his promise to create the greenest government ever. If he had rejected the climate committee's advice, environmentalists claim he would have lost all credibility.

The issue has divided coalition colleagues from within the same party, with Mr Cable understood to have infuriated Lib Dem colleagues by trying to block the 2027 target.

While some companies have been urging government to adopt the target to secure a low-carbon economy in the UK, Mr Cable promoted the position of the elements of the business lobby most likely to be threatened by it.

Meanwhile Foreign Secretary William Hague put the case for strong carbon targets to keep up with countries like China in the move towards low-carbon energy, and to retain the UK's international moral leadership on the issue.

'Rare victory'

Labour have previously said that if ministers did not accept the committee's recommendations in full it would amount to a "green betrayal" and accused Mr Huhne of failing to "show leadership" over the issue.

They say carbon reduction targets must not be watered down as part of efforts to alleviate red tape on industry.

Greenpeace described the agreement as "rare victory for the green growth agenda" in the face of what it said was "vehement" opposition from the Treasury and the Department of Business.

But Friends of the Earth said Mr Huhne should have gone further and accepted advice to tighten the UK's existing 34% emissions reduction target, by 2020, to compensate for the cuts already achieved due to the recession.

A Department of Energy source defended the government's handling of the issue, arguing that it would be wrong to pre-empt discussions underway in the EU and the UK was still arguing to increase the EU 2020 target from 20% to 30%.

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