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Lord Lawson Conservative peers shone during questions on the economy yesterday. They sparred with Lord Myners, who was made Financial Services Secretary in October 2008. To his credit, he has a varied CV - having been a teacher, journalist, business leader, banker and academic.

The Earl of Caithness put an elegant boot into the Government:

"My Lords, given the complete mess that the Treasury made of last year’s forecasts—it expected a budget deficit of 2 per cent of GDP when it is more likely to be 10 per cent, and expected economic growth of at least 2.5 per cent when in fact it is likely to be minus 3.5 per cent—would the Minister agree with the OECD that half of our problems were structural and related to government policy and nothing to do with the worldwide recession? What are the Government going to do about that?

Lord Myners: My Lords, my right honourable friend the Chancellor of the Exchequer will give a detailed analysis of the situation in the world and domestic economies when he makes his Budget presentation tomorrow. We are in the midst of a truly extraordinary global recession. For the first time in 60 years, the IMF has forecast a net reduction in added value for global economic activity. This problem is not confined to one country; it is a global problem. That is why the Prime Minister, in his chairmanship of the G20, led a global solution."

Former Chancellor Lord Lawson of Blaby (above right) did the same:

"My Lords, will the Minister explain to simple-minded folk like me how it is that when the British economy was expanding, at a time when the whole world economy was expanding, that was entirely to do with the success of the British Government; but now that the British economy is contracting rather faster than most of the world in a contracting world economy, it is nothing to do with us but is entirely to do with the world?

Lord Myners: My Lords, the noble Lord, Lord Lawson, knows that I am new to the world of politics, so it is perhaps harder for me to find an easy answer to that question than it would be for many others who have come to this House from the other place. But let us look at the facts. Over the 10 years to 1996, GDP per capita in the UK was the lowest in the G7. Over the following 10 years, it was the second highest in the G7. Since 1997, which was an important year, as no doubt the noble Lord remembers, UK real GDP per capita has increased by more than any other G7 economy. That was a tribute to the masterful management of the economy by my right honourable friend who was the Chancellor in those days, who is now our Prime Minister."

Shadow Treasury Minister Baroness Noakes cited the International Monetary Fund:

"My Lords, we are sorry to see that the noble Lord, Lord Desai, is not in his place today. Does the Minister agree with his noble friend that the warnings of the IMF that the UK economy was the least well prepared are now ringing true and that the Prime Minister’s reputation for sound economics was destroyed even before the recession?

Lord Myners: My Lords, I note that my noble friend Lord Desai is publishing a novel. No doubt he was reaching out for any opportunity for publicity and he could not possibly let slip the chance to write an article for the Evening Standard. I read that article with interest. The noble Lord, Lord Desai, clearly has considerable art and skill in the act of fiction."

Lord Hamilton of Epsom (Archie Hamilton) asked about borrowing, and wrought a rare admission of imperfection from the Government:

"Lord Hamilton of Epsom: My Lords, does the Minister accept that one of the less masterful elements of managing the economy has been the astronomical growth in personal borrowing? Have the Government learnt any lessons from this, and is there anything that they would have done differently, with the advantage of hindsight?

Lord Myners: My Lords, the report by the noble Lord, Lord Turner, referred to the increase in leverage in this economy and elsewhere. That has been picked up by the G20 meeting and by the work of the Financial Stability Forum, which referred to macroprudential requirements to reduce the growth in debt and leverage in economies going forward. That action is now receiving a great deal of attention, and perhaps it should have received more attention in the past than it did."

Former Cabinet Minister Lord Lang of Monkton also relished the chance to fashion a bullet:

"My Lords, as the last Chancellor of the Exchequer got his borrowing forecasts wrong by ever widening margins in almost every year that he held that office, and as his successor got his wrong by even wider margins in the Pre-Budget Report and his first Budget, why should we believe a word that either of them say tomorrow about future forecasts?

Lord Myners: My Lords, on the extent to which the previous Chancellor of the Exchequer got his borrowing forecasts wrong, it was because the economy was so buoyant that he was able to borrow more. His borrowings as a percentage of GDP were very close to forecast, and I am sure that the skills of the Treasury will continue to be available to his successor, my right honourable friend the Chancellor. We will see his forecasts tomorrow, and receive them with the support and encouragement needed to provide the confidence that is essential to take us out of this global recession toward a prosperous future."

Every time I read transcripts of debates in the House of Lords I am delighted by the overall standard and in particular by the performance of Conservative peers. David Cameron must not be afraid to make ministers of many of them nor to heed the advice of those who have already served in Whitehall.

Tom Greeves

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