EU ministers to meet on 9 May to decide on Greek aid

The Eurozone finance ministers will meet on 9 May to work out a deal to release £4 billion of aid to Greece, which forms part of the bailout package agreed with creditors last summer.

The spokesman for Dutch finance minister Jeroen Dijsselbloem said yesterday that creditors need a little more time to work with Athens on the legal possibilities for a contingency mechanism that would trigger further austerity if Greece misses targets.

The eurozone finance ministers suggested Athens would have to come up with and put into law extra austerity measures worth 2 per cent of gross domestic product.

The Greek government and the IMF have since been at loggerheads over how to find the so-called contingency measures, or additional austerity, if Greece misses its budget targets.

Greek finance minister Euclid Tsakalotos argued that the savings should come by trimming public spending across all government departments if Greece's fiscal watchdog says it is needed. But the IMF wants the set of extra austerity measures to be specified before talks.

Meanwhile, Pierre Moscovici, the European Union's economic affairs commissioner, supported the Greek government's view, saying that the extra austerity package does not need to be detailed or specified upfront.

''The mechanism is a way to have measures if necessary, but in our view we do not need a precise, detailed set of measures,'' Moscovici added.

Legislating an extra set of economic overhauls now could also be politically challenging for the Greek government, which will have to get these measures through an already thin parliamentary majority.

It comes as the situation as Athens once again runs out of cash to pay salaries and pensions, and faces looming debt repayments to the IMF and European Central Bank (ECB) in June and July.

Government spokeswoman Olga Gerovasili said "the IMF is making demands which go beyond what was agreed, adding that these demands undermine efforts by both the Greek government and European institutions.