* EFSF's effective capacity must be raised to 440 billion
* EFSF and permanent crisis mechanism should not buy bonds
* Portugal can do more on structural, labour reforms
* Not the right time to think about Greek debt restructuring
By Andreas Rinke and Terhi Kinnunen
HELSINKI, March 4 (Reuters) - The effective lending capacity of the euro zone's bailout fund should be increased to the full 440 billion euros, Finland's finance minister said on Friday, even though it is not clear at this stage that any other countries need to tap the facility.
Speaking to Reuters in an interview, Jyrki Katainen said he did not think either the existing fund, the European Financial Stability Facility (EFSF), or the permanent crisis mechanism that will take effect from mid-2013, should be used to buy bonds from heavily indebted countries such as Greece.
"It is important that the instrument is workable and we have to be ready to make it as large as we have agreed, 440 billion (euros)," he said of the EFSF, which was set up last May and has a current effective capacity of 250 billion euros.
"We don't need to rush on this, because if we are ready to do whatever is needed to get 440 billion out of the fund, it should be enough," he said.
"The main issue is that we are ready to do whatever is needed, if the money is needed. But right now, today, it doesn't look that obvious that there are more clients coming (to seek assistance from the EFSF)."
Katainen, who will host a meeting of a dozen centre-right EU leaders on Friday to discuss the euro zone debt situation, said he did not see room for Ireland's 85 billion euro bailout package, agreed last November, to be renegotiated.
Ireland is pushing to have the interest on its 40 billion euros plus of EU loans -- an average rate of 5.8 percent -- reduced to make it easier to pay back the money it owes.
"There are no free lunches," Katainen said.
"Of course we have to take care that the Irish package really works, because it is in all our interests to ensure that Ireland will recover... Therefore we have to look at the debt sustainability," he said, adding:
"I don't know exactly what will be the outcome, but we have to at the same time look at the Irish sustainability development and be very strict. We don't loosen the package."
If the maturity or the interest on Ireland's loans were to be reconsidered, Katainen said other guarantees would have to be made by Ireland, such as fiscal commitments.
"We have just agreed on a package on Ireland and it is very important to stick on to what we have agreed on," he said.
The finance minister, who is the leader of Finland's centre-right Conservative party and in line to become the next prime minister, also said Portugal could do much more to reduce its budget deficit and reform its economy.
"Even though the Portuguese government has said that they have done already a lot, if the market doesn't believe this or if the sentiment is still nervous, they just have to do more.
"I know they are doing their best, but they have to put more effort on reform, especially on structural issues, such as labour market issues," he said.
He praised Spain, saying it had shown the way on economic reforms and convinced financial markets of its determination, restoring confidence.
On Greece, he said the country needed to stick to the terms of its 110 billion euro EU/IMF bailout and not think about a debt restructuring at this stage.
"I wouldn't want to speculate on debt restructuring, because they can also do a lot by following the package we have agreed on with the IMF, EU and Greece," he said.
"The best way to deal with the Greece crisis is to follow very strictly the package... It is no time to start to talk about the debt restructuring."