LUXEMBOURG — Europe faltered Monday in its race to save Greece from default as finance chiefs said further aid hinged on embattled Prime Minister George Papandreou delivering budget cuts in the face of domestic opposition.

On the eve of a confidence vote that threatens to topple Papandreou, the euro area’s top economic policymakers pushed Greece to enact laws to cut the deficit and sell state assets. They left open whether the country will get the full $17.1 billion promised for July, running into International Monetary Fund criticism for indecisiveness.

“The Greeks have to bring to Parliament their austerity measures and their privatization package and they have to implement those measures,” Luxembourg Finance Minister Luc Frieden told Bloomberg Television at a euro crisis meeting Monday. “Only if those conditions are fulfilled, we can pay out the next tranche and at the same time look for a possible second program to support Greece.”

Decisions on the next payout and a three-year follow-up package were put off until next month, prolonging Greece’s fiscal agony and heightening the brinksmanship that has marked Europe’s handling of the unprecedented debt crisis. The stumble negated gains made in markets last week after Germany indicated a second Greek bailout was in the works.

Greek bonds and European stocks fell. The euro slipped as much as 0.8 percent before rebounding. It was little changed at $1.4322 at 4 p.m. in Frankfurt. Finance ministers will meet again July 3 to decide on Greece’s loans.

The IMF, contributor of a third of bailout money for Greece, Ireland and Portugal, scolded European leaders for failing to take a “cohesive and cooperative approach” to a crisis that risks triggering “large global spillovers.”

In the two-day gathering, the finance ministers delivered on year-old pledges to boost the effective lending capacity of a temporary rescue fund to $630 billion by increasing each country’s guarantee. Collateral rules had limited the fund to about $358 billion.

In a departure from earlier plans, they decided that loans to Greece, Ireland and Portugal from the future permanent fund won’t enjoy preferred status over private creditors. That fund, the European Stability Mechanism, will take effect in July 2013.

Luxembourg Prime Minister Jean-Claude Juncker, who chaired the meetings, called that move “good news” because it will help ease the three countries back into market financing.

The European deliberations coincided with a Greek parliamentary debate in Athens over a confidence vote in a new Cabinet at what Papandreou called a “critical crossroads.”

Papandreou has 155 seats in the 300-seat Parliament. The vote is scheduled for today. The struggle over Greece is set to dominate an European Union summit in Brussels on June 23-24.

“The communication cacophony surrounding the policy response in our view is one of the reasons why the risk of contagion has remained and remains high,” said Silvio Peruzzo, an economist at Royal Bank of Scotland Group in London.

Group of Seven financial officials also convened during the euro ministers meeting, holding a teleconference to discuss Greece. Two weeks ago, President Barack Obama singled out Germany as the key country responsible for preventing an “uncontrolled spiral of default” in Europe.

Prospects for a second aid package to stave off the euro area’s first default were lifted by reassurances last week from European officials that the next aid payment was on track, and by the decision by German Chancellor Angela Merkel to drop calls for a mandatory bond exchange that might lead credit rating companies to declare Greece unable to pay its bills.

Merkel’s concession Friday gave a lift to stocks, bonds and the euro, spurring optimism that leaders would get ahead of the debt crisis that has exposed the weaknesses of Europe’s economic management.The IMF scolded European leaders for failing to take a “cohesive and cooperative approach” to a crisis that risks triggering “large global spillovers.”