Osborne needs to launder a euro bailout through the IMF

The Chancellor cannot be seen to throw good pounds after bad euros, but nor can he stand by as the s

Given the difficulty the government had last time it tried to get an increase in Britain's contributions to the International Monetary Fund through parliament, George Osborne is unlikely to relish the prospect of repeating the exercise.

The fact that the Chancellor, speaking in Hong Kong, has urged G20 leaders to help boost IMF cash fire power is testimony to how severe the threat posed by continuing crisis in the eurozone is to the global economy. Britain would be prepared to chip in if other countries did too in order "to promote the economic stability from which we all benefit," Osborne said. This follows similar comments in a BBC interview yesterday and to Parliament last week indicating that the government is preparing the ground for a potentially unpopular IMF cash infusion.

The epicentre of instability is, of course, the eurozone, but Osborne cannot make an explicit commitment to bailout Britain's continental neighbours for fear of aggravating eurosceptic Tory backbenchers. Labour has also made it clear that it would oppose a direct transfer of UK money to a dedicated EU bailout fund - even one administered by the IMF. If enough Tories rebelled, a vote in parliament that ended up being framed in terms of whether or not good British pounds should be thrown after bad euros would be very tricky for the government. So any UK assistance to precarious eurozone economies has to be laundered through the general IMF kitty. (In practice that is hardly different from contributing to a specific euro bailout fund and eurosceptic rebels are unlikely to accept the distinction.)

Osborne recognises that economics, trade and geography make it a matter of some urgency for Britain that the IMF is adequately resourced to help potentially insolvent eurozone countries. But Conservative party politics - and the slightly poisoned atmosphere of Britain's diplomatic relationships within the EU - make it hard for him to take any kind of lead in getting the crisis resolved. It might, in any case, be too late.

The round of European sovereign credit downgrades last week had a knock-on effect of damaging the creditworthiness of the European Financial Stability Facility (EFSF) - the vehicle that is meant to administer bail out funds to keep the euro area functioning. There isn't anywhere near enough cash in the EFSF to cover the debts of all of the distressed euro member states, so the idea was always that the fund would trade on the aggregate creditworthiness of contributing countries to raise more capital. If the states funding the EFSF are themselves facing downgrade, the whole thing looks unsustainable.* (Germany is an exception, being a big economy with a solid credit rating, but Berlin is unwilling to evacuate its budget for the collective European cause.)

In other words, the fact that the euro rescue plan was really just a kind of pyramid scheme in which indebted countries promise to bail each other out by borrowing money is being exposed. That is another reason why the IMF will have to get more involved over the next few weeks.

Meanwhile, the draft eurozone-plus treaty, enforcing fiscal discipline and envisaging greater budget coordination between member states, is looking ever more irrelevant to the immediate crisis. It imposes rules to prevent a recurrence of the current situation, ignoring the facts that (a) such rules already existed and were ignored and (b) the current situation is upon us and cannot be cancelled out by wishing the rules had been obeyed more rigorously in the past. The horse has bolted and EU leaders are arguing about what kind of lock to put on the stable door.

*Update: The EFSF has been downgraded by Standard & Poors.

Rafael Behr is political columnist at the Guardian and former political editor of the New Statesman

Getty Images.
Show Hide image

The government must demand that Iran release Nazanin Zaghari-Ratcliffe

Iran's imprisonment of my constituent breaches the Convention on the Rights of the Child.

I grew up with a very paranoid mother. She had tragically lost members of her family as a teenager and, as a result, she is extremely fearful when it came to her children. I used to laugh at her growing up – I indulged it but often scoffed at her constant need to hear from us.

A few days ago, I was in Parliament as normal. My husband, his parents and our baby daughter were all in Parliament. This rare occasion had come about due to my mother in law’s birthday – I thought it would be a treat for her to lunch in the Mother of Parliaments!

The division bells rang half way through our meal and I left them to vote, grabbing my phone of the table. “See you in ten minutes!” I told them. I didn’t see them for more than five hours.

The minute the doors bolted and the Deputy Speaker announced that we were indefinitely being kept safe in the chamber, all I could think about was my daughter. In my heart of hearts, I knew she was safe. She was surrounded by people who loved her and would protect her even more ferociously than I ever could.

But try explaining that to a paranoid mother. Those five hours felt like an eternity. In my head, I imagined she was crying for me and that I couldn’t be there for her while the building we were in was under attack. In reality, I later found out she had been happily singing Twinkle Twinkle little star and showing off her latest crawl.

That sense of helplessness and desperate impatience is hard to describe. I counted down the minutes until I could see her, as my imagination ran away with me. In those 5 hours, I started thinking more and more about my constituent Nazanin Zaghari-Ratcliffe.

Here I was, temporarily locked in the Parliamentary chamber, surrounded by friends and colleagues and door keepers who were doing all they could to keep me safe. I knew I was going to be let out eventually and that I would be reunited with my daughter and husband within hours.

Nazanin has been detained in the notorious Evin prison in Iran for nearly a year. She only gets an occasional supervised visit with her two-year-old daughter Gabriella. She’s missed Christmas with Gabriella, she missed Gabriella’s second birthday and no doubt she will be missing Mother’s Day with Gabriella.

But it’s not just the big occasions, it’s the everyday developments when Gabriella learns a new song, discovers a new story, makes a new friend. Those are the important milestones that my mother never missed with me and the ones I want to make sure I don’t miss with my daughter.

Unfortunately, Nazanin is just one of many examples to choose from. Globally there are more than half a million women in prison serving a sentence following conviction, or are awaiting trial. Many of these women are mothers who have been separated from their children for years.

In 2010, the United Nations General Assembly unanimously adopted the Bangkok Rules - the first international instrument to explicitly address the different needs that female prisoners have. It was also the first instrument to outline safeguards for the children of imprisoned mothers.

The Bangkok Rules apply to all women prisoners throughout all stages of the criminal justice system, including before sentencing and after release. However, Nazanin’s case has seen a wilful flouting of the rules at each and every stage.

Rule 23 states that ‘Disciplinary sanctions for women prisoners shall not include a prohibition of family contact, especially with children’. Tell that to her daughter, Gabriella, who has barely seen her mother for the best part of a year.

Rule 26 adds that women prisoners’ contact with their families shall be facilitated by all reasonable means, especially for those detained in prisons located far from their homes. Tell that to her husband, Richard, who in almost a year has only spoken to his wife via a few calls monitored by the Iranian Revolutionary Guard.

Iran has ratified the Convention on the Rights of the Child and supported the Bangkok Rules, yet it is breaching both with its treatment of Nazanin. It is therefore incumbent upon our government to take the formal step of calling for Nazanin's release - it is staggering they have not yet done so.

As I pass the window displays in shops for Mother’s Day, most of the cards have messages centred around ‘making your mother happy’. If there’s one mother I’d like to make happy this year, it’s Nazanin Zaghari-Ratcliffe.

Tulip Siddiq is Labour MP for Hampstead and Kilburn