asked Her Majesty’s Government:

How many tonnes of gold have been sold from United Kingdom reserves since 1 May 1997; how much revenue was received from the sale of those gold reserves; and what the gold would be worth at current prices.

My Lords, in view of the volatility of gold prices, 395 tonnes of gold were sold from the reserves as part of a restructuring programme to reduce the risk exposure of the official holdings portfolio between July 1999 and March 2002. The total proceeds were around $3.5 billion, equivalent to £1.9 billion. On 3 November, the current market value of the gold sold was around $9.3 billion, equivalent to £5.7 billion.

My Lords, I thank the noble Lord for that informative Answer. What replacement investment did the Government make to ensure that the UK had a significant reserve for the inevitable rainy day, and how did this investment fare?

My Lords, given that gold is not a liquid asset, the Government invested the proceeds in dollars, euros and yen, which are interest-bearing, which gold is not, and have reaped the benefits from that. The present position reflects the volatility of all prices. To take the most obvious factor, the price of gold itself has gone down by something like 20 per cent in the past six or seven months.

My Lords, the Question is very simple:

“how many tonnes of gold have been sold from United Kingdom reserves since 1 May 1997”.

The Minister has not given the answer. What is it? Is it not high time that the Treasury stopped putting up stonewalling Answers?

My Lords, the Treasury has given straight answers to the question ever since the sale of gold concluded way back in 2005. The Government undertook at that time to reduce the risk factor in the portfolio by selling tranches of gold, and they made clear the amount being sold. They made it absolutely clear that those were the sums and that nothing was to be sold subsequently, and nothing has been.

My Lords, given that the balance of payments deficit has risen as a proportion of GDP by 100 per cent over the past four years and now stands at almost 4 per cent of GDP, is the Minister content that the current level of reserves is adequate? Do the Government believe that they have adequate foreign currency reserves given the likely outlook for the British economy?

My Lords, as the noble Lord is all too well aware, particularly with the advantage of yesterday’s debate, we live in challenging economic times. All aspects of the economy are under pressure, including the reserves. But he knows what the reserves are there primarily for, in relationship to the currency; and the Government do not intervene on exchange rates.

My Lords, the Minister has told the House that if we had held on to our gold, we would have another $6 billion-worth in reserves. I am sure he would agree that if an investment manager had made a transaction like that, he would probably now be out of a job. So can the Minister confirm that it was the Prime Minister who authorised the sale of the gold?

My Lords, it was the Chancellor of the Exchequer who authorised the sale of the gold. Let me make this point clear. The Conservative Front Bench is being wonderfully predictive after the event, basing its position on where the gold price is now. It did not advance those criticisms to the same extent at the time; nor was it the case that other informed analysts suggested that this was anything other than a perfectly proper transaction by the Government. The then Governor of the Bank of England, Eddie George, thought that it was a perfectly reasonable strategy for the Government to follow.

My Lords, if we are in the business of trading blows with the opposition Front Bench on the value of assets sold some years ago as compared with what they might be worth today, can my noble friend remind us—if he does not have the figures to hand, perhaps he could place a copy in the Library—of the value of all the privatised industries sold between 1979 and 1997, including the railways that we have just been discussing?

My Lords, I cannot follow my right honourable and noble friend in trading blows with the opposition Front Bench, because our relations are entirely cordial. Through these exchanges we merely seek to enlighten the public. The Opposition are worried about a small amount of gold, but the country was worried about the huge amount of family silver that they sold.

My Lords, does the Minister concede that the inexorable logic of recent turbulence is that the British Government should now join the eurozone?

Oh!

My Lords, that proposition was put forward from the Liberal Benches in the debate last night and was received marginally more enthusiastically than it has been today. There were fewer groans.

My Lords, does the Minister recall the boast of Poo-Bah in “The Mikado” that he could so manage things as Paymaster General that the Lord High Auditor would not be able to detect what he had done, and that he held both roles?

My Lords, Poo-Bah is not answerable for Treasury activities in this country but Her Majesty’s Treasury is answerable to Parliament. As the noble Lord will know, all these transactions are open, identifiable and, of course, subject to scrutiny. Not only the Treasury Select Committee but the Public Accounts Committee has examined the position, and it was regarded as an entirely reasonable position at the time.

My Lords, is the Prime Minister no longer the First Lord of the Treasury?