Greek Prime Minister Lucas Papademos will hold a meeting with the leaders of the three largest Greek political parties today or tomorrow, in an attempt to garner support for a new programme of austerity measures laid out by EU/IMF under the planned second Greek bailout.

European officials suggested last night that a deal on the voluntary Greek restructuring was only ‘hours’ away, however no final agreement was reached due to remaining differences between Germany and the IMF as well as amongst the Greek parliamentary parties.

David Cameron yesterday faced criticism from some Conservative backbench MPs over his decision not to challenge the role of the EU institutions under the new European fiscal treaty, while Labour leader Ed Miliband criticised what he called a “phantom veto”.

The new European fiscal treaty on budgetary discipline will be signed by 25 EU member states, after the Czech Republic decided to stay out citing “constitutional reasons”. However, speaking to the press after the summit, Czech Prime Minister Petr Necas hinted that his country could possibly join at a later stage.

Open Europe has published a new report setting out how the Coalition could, during the lifetime of this Parliament, use a one-off opportunity to unilaterally repatriate up to 130 EU laws on crime and policing, including controversial measures such as the European Arrest Warrant.

The front page of Handelsblatt claims that, despite its public position, the German government has been planning for a Greek exit from the eurozone, even engaging in discussions with business leaders over its potential impact on the German economy. Meanwhile, the negotiations on the voluntary Greek restructuring started up in Athens again last night, with reports of progress being made.

Hollande calls for Eurobonds and EU “anti-dumping” legislationFrancois Hollande, socialist candidate for the French Presidency, today published his detailed proposals ahead of the French presidential elections, calling for European “anti-dumping” legislation, the creation of Eurobonds, and an EU “growth pact”.

Ratification of fiscal pact looks doubtful in Poland and SwedenPolish PM Donald Tusk has said that if Poland is unable to secure a degree of participation rights at future eurozone economic meetings, it would be difficult for the country to sign up to the fiscal compact.

Open Europe has today published a new briefing looking at the arguments for and against the EU’s continued involvement in regional spending via the structural funds in Britain and other member states. Between 2007 and 2013, Britain will pay in around £30bn to the EU’s so-called structural and cohesion funds, but get back just under £9bn.

EU Taxation Commissioner Algirdas Semeta told the FT, “The UK would lose a lot if other [EU] members decide to move ahead with a financial transactions tax. Because of its design, [Britain] will be subject to the tax, but at the same time, it will not receive any money from it.

The fourth draft of the new European ‘fiscal treaty’ setting out stricter budgetary rules for the eurozone was published yesterday. The agreement now establishes that, from March 2013, eurozone countries will be allowed to receive bail-outs under the eurozone’s permanent rescue fund, the ESM, only if they have ratified the fiscal treaty – a provision which Germany was particularly keen on.

France and Germany yesterday unveiled a set of joint proposals which they say would boost growth in the EU. The proposals will be submitted to European leaders at their meeting on 30 January. The document reads, “European institutions and member states should accelerate the process of tax coordination…In particular, the negotiation of the European Commission proposals on Energy Tax Directive, Common Consolidated Corporate Tax Base and Common System of Financial Transaction Tax should be accelerated.

Negotiations between the Greek government and private bondholders are due to resume today, as the country prepares for a second day of mass strikes and protests. The Telegraph reports that, according to sources close to the negotiations, Greek officials showed enough flexibility in their position to convince bondholders to return to the table.

As expected S&P last night downgraded the EFSF, the eurozone’s bailout fund, from AAA to AA . The move is likely to lead to higher borrowing costs for the fund which will feed through to higher rates on any loans it pays out, reducing its effectiveness.

The threat of a Greek default moved closer on Friday as negotiations broke down between Greek private bondholders and European officials. Head of the Institute for International Finance, Charles Dallara, said: “all the European heads of state said they wanted a deal with a 50% [haircut] and a voluntary agreement…Some of their own collaborators are not following that decision.

FTD reports that the ECB has responded critically to the latest draft of the fiscal treaty, with board member Jörg Asmussen describing it as a “substantial dilution”, and calling for the proposed measure which would allow states to exceed the 0.5% of GDP deficit threshold in “exceptional circumstances” to be significantly tightened.

The UK Government yesterday welcomed the latest draft of the new European fiscal treaty as “real progress.” David Cameron’s official spokesman said, “Our position has always been that this agreement is fundamentally about fiscal rules for the eurozone and how to conduct fiscal policy in the eurozone.

Open Europe was this morning the first to publish the third draft of the European ‘fiscal compact’. Following last week’s meeting of negotiators from EU member states, the third draft has removed the reference to “deeper integration in the internal market” as one of the objectives of the agreement, marking a potential victory for David Cameron who has consistently argued against any overlap between single market rules and the new pact.

Bild reports that German Finance Minister Wolfgang Schaüble is looking at ways to circumvent Germany’s constitutionally embedded debt brake, most likely involving a vote in the German Bundestag. This would offer the government a degree of flexibility in the case of an emergency, such as a new wave of bank bailouts.

On Friday, Open Europe was the first in the UK to publish the most recent draft of the European pact on greater fiscal integration. The new version controversially envisages a greater role for the Commission and ECJ, and includes explicit references to the single market, competitiveness and ‘social cohesion’.