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Some of Greece's bailout is going to come from a fund contributed to by Britain and George Osborne is 'furious'

Jul 15, 2015, 16:10 IST

Britain's Chancellor of the Exchequer George Osborne arrives at an European Union finance ministers meeting in Luxembourg, June 19, 2015.REUTERS/Francois Lenoir

The European Commission just confirmed that the European Financial Stabilisation Mechanism (EFSM) will be used for at least part of Greece's new bailout.

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The Commission intends to provide some bridge financing to Athens so it can get over its immediate debt repayments, which will come from the fund.

That's not good news for the United Kingdom's government. The European Stability Mechanism (ESM), which Greece formally requested a bailout from, is for eurozone members only. As a result, the UK has no direct exposure. But the EFSM is for the European Union as a whole and includes British contributions.

Westminister has been unhappy with this development, and reportedly tried to block it from happening, without much success.

According to Financial Times Brussels bureau chief Peter Spiegel, UK chancellor George Osborne was "furious" at the idea that the fund would be used.

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Here's what the European Commission actually said on Wednesday:

The programme covers the period until the end of July 2015. It aims to provide a bridge financing to allow Greece to face some urgent financial obligations until it starts receiving financial assistance under a new programme from the ESM. Against this background, the provision of Union assistance to Greece under the EFSM would safeguard financial stability in the Union and in the euro area. The union assistance would be disbursed in one instalment and be linked to economic policy conditions.

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