The euro currency in its current form will doomed and the euro zone will collapse, warned former UK foreign secretary and current Labour MP Jack Straw.
Straw has suggested that as the Greek fiscal crisis worsens that Britain consider “alternatives” as MPs discuss the worrisome likelihood of Athens requiring another financial bailout.
He told ministers in parliament: “We should… recognize that this euro zone cannot last. And it is the responsibility of the British government to be open with the British people now about the alternative prospects. And since the euro, in its current form, is going to collapse is it not better that this happens quickly rather than a slow death.”
Straw added: And it is the responsibility of the British government to be open with the British people now about the alternative prospects.
He was speaking as MPs discussed the prospect of a fresh bailout for Greece, which is being pressured by other euro zone members to impose even harsher budget cuts should it want continued funding.
There is widespread skepticism in Europe and Britain over Greece’s willingness to enact reforms and pay back its huge debts.
The British Treasury Minister Mark Hoban said that while it is in UK's interest to ensure the continuing stability of the euro zone, he added that the British taxpayer should not be burdened by having to contribute more to Greece’s loans.
The UK only participated in the May 2010 package for Greece through its membership of the IMF,” he said.
So the burden of providing finance to Greece is shared by the IMF and Euro-area member states and we fully expect this to continue. Our position on this is well understood across the euro area.
Hoban also indicated the UK’s exposure to the Greek economy is relatively small (about $4-billion).
Many British lawmakers and politicians, including London Mayor Boris Johnson, are calling for Greece to default and exit the euro.
Conservative MP Anne Main said Greece should be put out of its misery and permitted to depart peacefully from the euro zone while fellow Bernard Jenkin, another Tory, said an orderly departure would be appropriate.
However, at least one prominent British voice is calling for the country to help Greece in its hour of desperation.
Former Labour Europe Minister Denis MacShane warned that if Greece abandoned the euro it would have grave consequences for the rest of Europe.
For a nation to go bankrupt would condemn its people to a long period of distress and misery, which would only create further immigration flows as Greek workers are forced to get on their bikes and seek employment elsewhere, he told BBC News.