Greece

Lord Lea of Crondall Excerpts

Monday 29th June 2015 Lords Chamber

[Lord Ashton of Hyde]

As regards the arrears, I was merely repeating the official nomenclature of the IMF. I would not comment on the precise meaning of the IMF vocabulary, but it is true that it refers to being in arrears. If that was the case, Greece would join Zimabwe, Somalia and the Sudan. On the referendum, the negotiations are coming to an end because, despite what the German Finance Minister said, if you are to have a sensible negotiation, you need to have willingness on both sides to compromise. Walking out instead of taking the decisions that are needed, and turning around without any warning and instituting a referendum, is not the way to get proper negotiations and to achieve success.

[Lord Lea of Crondall (Lab)]

My Lords, is not one of the difficulties of the analysis that people assume that something follows on from having a referendum, which of course must be nonsense? It is not a logically connected piece of analysis. There can be all sorts of scenarios from where we are now, but Angela Merkel has said that the referendum question is simply, “Do you want the euro? If so, vote yes. If you want the drachma, vote no”. Can it be as simple as that? Are there not a number of scenarios that could follow, and should we not be thinking through a number of them, otherwise the schizophrenia in this debate about whether a referendum is a bright idea has not been followed up by thinking through the policy scenarios?

Montenegro is just up the road from Greece. It is a member of the United Nations and a singing and dancing country. It uses the euro without permission from Frankfurt. It is not obvious to me exactly what the connection is between the way the referendum is posed and the scenarios that follow.

[Lord Ashton of Hyde]

I can see the noble Lord’s problem, but I do not think that it is a problem for the UK Government. The referendum was instituted by Greece and it is up to them what the question should be, what they are trying to address and why they are trying to have one. I completely agree with the noble Lord that there are many scenarios resulting from that. The Treasury, the Government, the Bank of England and the Foreign Office are looking at this and working out contingency plans on a daily basis.