Cowen says public will not vote on treaty change

THE EU Treaties will be amended to allow member states to bail out one another, but it almost certainly won’t be put to a referendum in Ireland, Taoiseach Brian Cowen has said.

EU leaders at a two-day summit in Brussels having agreed the two-sentence addition tried very hard not to say anything that might increase markets fears about the euro.

As they met behind closed doors last night, there was little doubt the permanent fund they are setting up for post-2013 and the ongoing crisis would take centre stage.

The addition to the treaty lays the ground rules for the fund saying that eurozone countries can only access it as a last resort and that strict conditions will apply to any countries tapping it. But as Moody’s rating agency followed up downgrading Spain’s credit rates earlier in the week, with a warning of further cuts to Greece’s, IMF head Dominique Strauss-Kahn warned EU leaders needed to design a “big plan” early in the new year.

He did not expect them to achieve much now, saying they needed more time to come up with a broad solution and to overcome the “piecemeal approach” they have used for Ireland and Greece.

As leaders continued to be split over the details of such a comprehensive plan, Mr Strauss-Kahn said he believed it was possible for them to come up with one.

He agreed with the overall thrust of most EU leaders that it would be better to postpone any discussions of e-bonds until after the crisis is contained. Belgium’s finance minister, Didier Reynders who has been chairing the finance ministers’ meetings for the past six months said he believed there would be “some sort of eubond”. He also believed there was unanimity to increase the size of the new permanent fund from the current €750 billion but this would only happen once countries got their budgets under better control.