asked Her Majesty’s Government:

How they define the term “boom and bust”, as used by the then Chancellor of the Exchequer in his Budget speech on 21 March 2007 (HC Deb, col. 816).

My Lords, a platform of stability is necessary for high and stable levels of growth and employment. That is what this Government’s policies have delivered, with a record period of growth and with inflation that in the past 10 years on average has been half what it was in the previous two decades. This is in stark contrast with the record of the previous Administration, when there were two deep recessions and unemployment reached 3 million.

My Lords, in all my years in the House that is the first time I have had an Answer that bears no relationship to the Question. I am asking for a definition. In my life, I have been brought up with stagflation, reflation and inflation, and when you had problems we would introduce a word. The one I introduce is the Icarus factor. The Government have flown too high and boomed, and their wings are melting and falling off. What will the future economy of this country be based on?

My Lords, I thought that I had answered the Question directly. I indicated that “bust” might be when unemployment reached 3 million, which it did under the previous Administration, and I indicated that the levels of stable growth under this Administration are in contrast with the accelerated growth that leads to bust, which happened under the previous Administration.

My Lords, the Chancellor’s former statement—we are talking about “no more boom and bust”—could arguably today be rephrased as “boom, then bust”. Does the Minister believe in economic cycles? What proportion of our economic predicament today does he believe is on account of global conditions? What plans do the Government have to prevent a recession?

My Lords, I think the House recognises that in no period under this Administration has there not been economic growth; nor are there forecasts of any period when we will not have economic growth. We have reduced our growth forecasts below what they were three or four years ago, because we recognise that world economic circumstances and the credit crunch adversely affect our economy, but reduced economic growth is a world away from bust.

My Lords, in 1999, the current Prime Minister, in a Mansion House speech, described the symptoms of boom and bust as,

“strong inflationary pressures in the system … Consumer spending … growing at an unsustainable rate … inflation … set to rise sharply above target”—

and—

“a large structural deficit on the public finances”.

If that does not describe the present state of the economy, what does?

My Lords, there is a forecast that, predominately through very high and rising world prices for food and energy, inflation will rise in the forthcoming quarters. We anticipate inflation rising to just over 3 per cent: in other words, below half the average that the previous Administration managed. That is why we think we are talking in very different terms from those of the previous Administration and their supporters today.

My Lords, am I not right that, while we experience the first global financial crisis, families will suffer here and overseas, but that it is worth bearing in mind that unemployment in Britain is half that in our European competitors? Manufacturing growth is actually increasing in Britain and our exports are doing very well. We are not devaluing the pound, as happened in the 1990s, and we will get through this difficult international crisis rather well and without the double-digit interest rates that we had under a previous Government.

My Lords, the whole House will be as grateful to my noble friend as I am for fleshing out those statistics. I emphasise that we should appreciate that the International Monetary Fund regards the problems that the world is going through at present, with the credit crunch, as being as great as any that we have had since 1929. None of us underestimates the challenge, but I am accurately reflecting not just Treasury forecasts but independent forecasters in saying that this economy will weather this storm somewhat better than in the period when the previous Administration were in control.

My Lords, whatever else is happening in the economy, will the Minister accept that we are facing a collapse in the housing market and in new housebuilding? What are the Government doing to get the housing market moving again, and what will they do to ensure that we do not see a rising stock of half-finished, unoccupied houses?

My Lords, the housing market is an important dimension of the difficulties that we face. The House will know of the significant support that we have put forward to sustain the market for those facing mortgage difficulties. The noble Lord is right, however, that in the short term there are bound to be difficulties with the level of house purchasing. That does not alter the fact that this Government look rather further ahead than the next few months. It is still the case that house prices reflect an acute house shortage in this country, which is why we will continue to see an increase in house-building in the forthcoming period.

My Lords, has the Minister’s attention been drawn to a report revealing that, as a result of the relaxation in the licensing laws in 2002, the number of sex clubs in London has doubled? Is that boom or bust?

My Lords, I lack familiarity with sex clubs.