Bankruptcy

Lord Davies of Oldham Excerpts

Tuesday 7th December 2010 Lords Chamber

[Lord Sassoon]

I completely agree with my noble friend. That is indeed it. I was looking at the Oxford English Dictionary this morning and I saw that one definition of “bankrupt” is,

“one who has brought himself into debt by reckless expenditure or riotous living”.

I would not presume to accuse the previous Government of riotous living.

[Lord Davies of Oldham]

My Lords, the successive attempts by the noble Lord to define bankruptcy have looked quite pathetic.

[Noble Lords]

Oh!

[Lord Davies of Oldham]

Well, his latest definition would indicate that every mortgage holder in Britain was bankrupt because they have substantial debts. The issue is whether these debts can be managed. He must draw a distinction between the situation of Ireland at the present time, or of Greece in recent times, and that of the United Kingdom, where, as has been indicated, our debt repayment is over a 14-year period.

[Lord Sassoon]

My Lords, leaving aside the fact that the mortgage payers of this country would be somewhat upset to be thought of as having brought it upon themselves by reckless expenditure, the point is, as the IMF succinctly put it in its report of 27 September 2010:

“The consolidation plan and implementation of early measures to tackle the deficit—one of the highest in the world in 2010—greatly reduces the risk of a costly loss of confidence in fiscal sustainability and will help rebalance the economy”.

That was what the IMF had to say.