The Dutch prime minister called for tougher sanctions on euro zone members in financial trouble to stem the region's debt crisis, rather than raising the size of the bailout fund or issuing joint euro bonds.
Prime Minister Mark Rutte and Finance Minister Jan Kees de Jager, who both appeared before a parliamentary committee on Tuesday to answer questions about the Greek bailout, both argued for much tougher measures in a bid to garner political and public support for rescuing financially strapped countries.
Such support is crucial for the government, a minority coalition between the Liberal and Christian Democrat parties. Parliament is due to vote in the next few weeks on some of the rescue measures agreed by European leaders last month.
"The chamber has asked me for fiscal discipline and an authority which can supervise this. That is what I have pleaded for in Europe and that is what we support," De Jager told the parliamentary committee.
He added: "That is something different from a European finance ministry that collectively issues debt," referring to talk the bloc needs to issue debt jointly to resolve the crisis.
Opposition politicians used Tuesday's debate to show their annoyance at the way Rutte and De Jager had given conflicting figures for the size of private sector participation in the Greek rescue package.
A parliamentary debate on the Greek bailout scheduled for Wednesday will show whether the three main opposition parties which supported the bailouts — Labour, Democrats 66 and GreenLeft — are still willing to vote in favour.
Labour, the second-largest party in the lower house, said on Tuesday it is still in favour of saving the euro, giving the two coalition parties a majority.
Their support is crucial, given that the government's ally, the Freedom Party led by anti-immigration politician Geert Wilders, strongly opposes bailouts.
"We are looking for a majority so that not one more cent is given to Greece," Freedom Party MP Teun van Dijck said.
The fiscally conservative Dutch are showing signs of bailout fatigue. Recent opinion polls indicate that public support for the huge rescue packages required by Greece, Ireland and Portugal — with Spain and Italy seen next at risk — is fading.
A recent poll showed that more than half of Dutch voters want Greece and other troubled debtor economies thrown out of the euro bloc.
PUNISHMENT
France and Germany will float proposals in September for a tax on financial transactions and push for stronger joint economic governance, French President Nicolas Sarkozy said on Tuesday after talks with German Chancellor Angela Merkel on the euro crisis.
The "last resort" of joint bond issuance, as Merkel called it, did not appear to be part of their accord.
Much of Tuesday's debate in the Dutch parliament centred on what alternative rescue plans might be available to stem the current crisis.
Dutch politicians said the coalition parties are open to supporting a new European fiscal institution that would punish euro zone countries which fail to obey budget rules.
Both Rutte and De Jager argued that talk of issuing common euro zone debt or of boosting the European Financial Stability Facility or EFSF was premature, and that it was more important to have a way of enforcing fiscal discipline on weaker members.
"The only route is the imposition of automatic sanctions as much as possible if obligations are not met," Rutte said.
"You have to be able to impose sanctions. That comes before all that speculation of euro bonds or increasing the EFSF," he added. "I am not a fan of all those instruments."
Rutte added he would prefer to first impose more frequent and tougher sanctions where justified, without transferring sovereignty to Brussels for countries that obeyed fiscal rules. The prime minister said that such sanctions had been discussed by European leaders last month.
"There is still discussion between government leaders, the European Commission and the European parliament about automatic sanctions and the preventive arm," he said.
"If you look at Spain and Italy and what happened there in the past week, then I say you have to go further. That is what the discussion is about. We are in touch with the German finance ministry about this and the vice chancellor," Rutte said.
