The European fiscal stability pact is akin to the Treaty of Versailles and will not work says former chancellor Alastair Darling.
Speaking to the Building Societies Association conference in Manchester today Darling says the pact is not working because it offers so little hope to people.
Over the weekend Francois Hollande was elected president of France on an anti-austerity message while the Greek election saw more than half of voters opting for parties that oppose its bailout agreements.
Darling says: “The Eurozone plan for Greece was always doomed because it was never going to work. It left Greece with a 120% debt in 2020 so it wasn’t credible.
“The other issue that was all too foreseeable is that if you push countries to a situation where they have no hope and no light at the end of the tunnel then the electoral results in Greece are not unexpected.
“People will turn to simplistic and sometimes downright nasty solutions. What Greece needs is a credible plan to recovery and light at the end of the tunnel.
“The European treaty has the same foresight as the Treaty of Versailles where you institutionalise a downward spiral. The day it signed it Spain said it could not meet its target and the Netherlands government has fallen because of it. It doesn’t seem that it is going to work.”