2ND LEAD: Tough Franco-German terms for Greek bailout get EU backing Eds: Adds Merkel remarks in grafs 8-9

Berlin/Brussels (dpa) - Franco-German demands that Greece prioritize debt repayments over other types of government expenditure won the support Tuesday of Luxembourg Prime Minister Jean-Claude Juncker - who heads the Eurogroup panel of eurozone finance ministers.

In a separate move piling pressure on Athens, an EU commissioner broke ranks from the official line that everything would be done to keep Greece inside the eurozone, telling a Dutch newspaper that the single currency bloc could survive without it.

Under the plan proposed Monday by German Chancellor Angela Merkel and French President Nicolas Sarkozy, new international bailout funds for Greece would be channeled through a special account that ensured repayments to Greek bondholders.

"This is not an absurd idea to help ensure that our Greek friends repay their debt," Juncker told German radio. But he also said: "As always, the devil is in the details."

In Brussels, the European Commission professed ignorance of the proposal - although a German finance ministry paper circulated last month contained similar ideas, as well as a more controversial plan to give the EU veto powers over Greek budget decisions.

"We are looking forward to receiving more details on this before taking a position," Amadeu Altafaj, spokesman for EU Economy Commissioner Olli Rehn, told reporters, adding that the Eurogroup would discuss the matter.

A snap meeting of eurozone finance ministers is expected to be called in Brussels as soon as the Greek authorities secure a debt write-off deal with private lenders and agree to implement the tough austerity measures that foreign lenders are demanding in return for aid.

Merkel said it was "possible" that Athens would accept the terms soon enough for the Eurogroup to meet late Thursday. Insiders said the German parliament could meet as early as Friday to begin the approval process if a deal was struck.

Merkel made her remarks to a gathering behind closed doors with her parliamentary group, the Christian Democratic Union and Christian Social Union, according to participants at the meeting.

Meanwhile Neelie Kroes, a former Dutch minister and current EU commissioner for internet regulation, told the Volkskrant newspaper that she was not in favour of a Greek euro exit, but added that there would be no "man overboard" situation if it did happen.

"It‘s always said that if you let one country get out, if it asks to get out, then the whole structure collapses. But that‘s simply not true," she said.

"The Greeks have to realise that we Dutch and Germans can only sell emergency Greek aid to our taxpayers if there‘s evidence of goodwill," Kroes added, referring to the austerity measures Greek politicians have been reluctant to embrace.

EU Commission President Jose Manuel Barroso later said that saving Greece was still in the bloc‘s best interests, but only if Athens made corresponding sacrifices.

"I do believe the costs of Greece leaving the euro would be much higher than a continued financial support for Greece," he said in Brussels after a meeting with Jacques Delors, a former EU commission president.

"But of course Greece must engage to take the necessary reform measures in a clear and unambiguous manner," Barroso added.

In his interview, Juncker warned that Greek politicians risked sending their country towards default if they did not agree to the bailout conditions, which include cuts in wages and pensions, as well as public sector layoffs.

"This is not a threat, but a simple description of the situation," he said.

Greece needs money before March 20, when it will have to pay back 14.5 billion euros (19 billion dollars) in maturing debt. dpa alv amc hm du jbp mat hm Authors: Alvise Armellini, Andrew McCathie, Kristina Dunz