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Bailout control for Germany

Wednesday, September 07, 2011 - 02:04

Sept. 07 - Germany's highest court has said that parliament must have a bigger say in the euro zone rescue packages. The landmark ruling may make it more difficult for Europe to respond quickly to debt crises. Penny Tweedie reports.

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Judges arrive at the Constitutional Court in Berlin - Germany's highest court. They came with a decision to reject a series of lawsuits brought by eurosceptics in an attempt to block the country's participation in euro zone bailouts. (SOUNDBITE) (German) PRESIDENT OF THE GERMAN CONSTITUTIONAL COURT, ANDREAS VOSSKUHLE, SAYING: "The euro zone financial stability law and the European Stability Mechanism fund relating to the bailout fund enabling Greek aid do not violate the voting rights under article 38 paragraph 1. Specifically, there is nothing in any of the laws passed that set an automatic precedent that would remove any of the German parliament's budgetary rights." But the Court's president Andreas Vosskuhle said the landmark ruling did not mean blank cheques for future rescue packages. He said the German parliament must have a bigger say in bailout deals. The Budget Committee will now need to approve aid packages first which could make it more difficult for Europe to offer aid quickly to crisis-hit member states. German Chancellor Angela Merkel said the decision supported her government's euro policy. (SOUNDBITE) (German) GERMAN CHANCELLOR, ANGELA MERKEL, SAYING: "And I also say that Greece must carry out structural changes. Greece has to introduce transparent structures into the country, and Greece of course has to invest whatever happens. The money is there in Europe. Greece hasn't even called on 70 per cent of its structural and cohesion funds. Portugal still has money. It is about creating structures which can create growth and there are not enough of these." Greece, Portugal and Ireland have already received aid from Europe and the International Monetary Fund while Italy - the third largest economy in the euro zone - looks increasingly vulnerable as it struggles to implement a savings programme. The prospect of having urgent rescue decisions bogged down in legislation in Germany - and potentially other euro zone parliaments, if more states follow suit - will not please policymakers trying to streamline that process. Penny Tweedie, Reuters.

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Bailout control for Germany

Wednesday, September 07, 2011 - 02:04