EU debt mountain rising despite crippling cuts

The EU's statistics office revealed that the debt mountain is actually growing as attacks on public services, welfare and jobs cripple national economies.

Eurozone countries' debt now amounts to 90 per cent of their collective GDP - up from 70 per cent at the time of the 2008 financial crash.

And debt for all 27 EU members is up to 82.5 per cent of GDP from 62.5 per cent.

The stats reinforced warnings from the European United Left and Nordic Green Left parliamentary grouping that the austerity driving millions into poverty is failing in its aim to tackle public-sector debt.

Group president Gabi Zimmer told the European Parliament: "The strategy to fight the crisis and achieve growth primarily through brutal cuts in public spending including wages and salaries, benefits, education and health care has failed."

But critics say Europe's rulers are not really interested in reducing debt and have simply used the fiscal crisis as an excuse to enforce an ideological attack on the public sector.

Europe's worst-hit country was Greece, where debt hit 150 per cent of GDP, up from 137 per cent three months ago.

Billions in its government debt have been written off by creditors in deals thrashed out by the troika - the EU, IMF and European Central Bank.

But the measures they demanded in return, including wage cuts, benefit cuts, privatisations and mass layoffs, have shrunk the economy far faster than the state can pay off its obligations.

Greek Finance Minister Yannis Stournaras claimed today he had obtained a two-year extension on implementing the bailout package.

But both the German government and the European Commission insisted no agreement had been reached.

And Central Bank president Mario Draghi stuck to the austerity hymn-sheet when he addressed German MPs today.

Plugging his plan to buy bonds from weak eurozone economies, he promised it would "not allow struggling countries to backslide on economic reforms."