Published: March 5, 2010
Burnham-On-Sea MP attacks government over £7 billion gold loss

Burnham-On-Sea's MP clashed with a senior Labour politician in the House of Commons this week over the sale of Britain's gold reserves.

David Heathcoat-Amory demanded an apology from Harriet Harman, deputising for the Prime Minister, over the $11 billion (£7.2bn) loss caused by selling tons of gold reserves at rock bottom prices when the value has since quadrupled.

Mr Heathcoat-Amory told "When Labour won the 1997 General Election, the new chancellor Gordon Brown started selling off gold from the Bank of England reserves."

"In all, 400 tons were sold at an average price of $275 per ounce. The price today is some $1,130 per ounce, which is more than four times higher."

"In monetary value, the difference between what the gold was sold for and what it would be worth now is nearly $11 billion."

The Burnham MP says Mr Brown was warned about the risks at the time of the sale as Mr Heathcoat-Amory, who was then Shadow Chief Secretary to the Treasury, and Francis Maude, who was Shadow Chancellor of the Exchequer, issued a statement in January 2000 questioning the sale.

"The government sold another 310 tons of gold after that at even lower prices - it is always dangerous when people with no commercial experience try their hand at playing world markets. It is inexcusable when they do it with our money. Gordon Brown, now Prime Minister, lost $11billion by pressing ahead with the sale of our gold reserves despite all the warnings and advice to the contrary."

Mrs Harman, who is Leader of the House of Commons, told Wednesday's debate: "We will take our responsibility seriously, and our responsibility is to see this country out of recession and into recovery. I think it is disappointing that the right hon. Gentleman should not accept and support the fact that it is right sometimes for Governments to apologise for what has been done in history."


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