Oral question asked in the House of Lords, by Earl of Caithness (Conservative). It was answered on Tuesday, 21 April 2009.

Economy

Question: 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?

Answer: 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.

Secondary information