German deputy minister says ESM leverage being discussed

Mon Sep 24, 2012 2:33am EDT
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BERLIN (Reuters) - German Deputy Finance Minister Steffen Kampeter said on Monday there is a discussion going on in Europe about leveraging the new permanent bailout scheme for the euro zone - and he promised that Germany's parliament would be consulted.

"If Europe decided to leverage the ESM (European Stability Mechanism) - and this discussion is going on - we would of course involve the German Bundestag (parliament's lower house)," Kampeter told Reuters.

Germany's Constitutional Court made consulting the Bundestag on any changes to the ESM a condition for giving its approval to the fund's ratification in a ruling earlier this month. Kampeter called such a step a "political and legal necessity".

Spiegel magazine reported in its latest edition that the euro zone wanted to leverage the ESM for a total capacity of more than 2 trillion euros, in a similar arrangement to that involving its predecessor, the European Financial Stability Facility (EFSF).

(Reporting by Gernot Heller; Writing by Stephen Brown)

Plaintiff Swen Schulz (R) arrives with State Secretary in the Finance Ministry Steffen Kampeter for the proclamation of a verdict on German parliament's role in Europe's EFSF bailout fund in Karlsruhe February 28, 2012. REUTERS/Alex Domanski