Will the Lords rough up auditors? Lord Lawson might take his gloves off.

I was not overly impressed by news from the House of Lords that its economic committee would investigate the audit market and whether auditors did enough in the run up to the banking crisis. We've been here before so what can the Lords possibly add?
Well the thing they do have, as a member off the committee, is Lord Lawson of Blaby, otherwise known as Nigel Lawson, the man famous for his diets and for once being a Tory chancellor under under Marget Thatcher's premiership.
So what, I hear you say. But Lawson, looking at his record, is not exactly an auditor's best friend.
Last year it was Lord Lawson alongside Lord (Norman) Tebbit who spoke out on auditors during questions in the House of Lords. They were robust, if not brutal about the performance of auditors and the banking crisis.
Lord Tebbit wanted to know how auditors had remained "out of the firing line" during the crisis and pushed the view that auditors were vulnerable to pressure from their clients, a view unlike the one recently published by the Financial Services Authority and the Financial Reporting Council.
Lawson went a step further and wanted to know whether the government was planning to sue the auditors.
The reason? Because in 1984 Lord Lawson was chancellor when merchant bank Johnson Matthey collapsed and had to be rescued by the Bank of England. Lawson decided there had been negligence all round and authorised the Bank (not independent then) to sue Arthur Young, the auditors. The Bank won.
Lawson then believes legal action is a legitimate tactic for sorting out errant auditors. More to the point, he comes to the latest House of Lords inquiry with perhaps little sympathy.
Of course, Lord Lawson is not chairing the committee. That falls to Lord (John) MacGregor, a former agriculture and education secretary under Thatcher who also spent two years at the Treasury as chief secretary. It's difficult to know if he has strong views on auditors but, obviously, he must know Lord Lawson very well, having served in the same government.
It now looks like the Big Four could well receive a working over from the noble Lords and who would be surprised if they came out with much stronger views than either the Commons Treasury committee or the Financial Services Authority.
Certainly there are those outside the big firms already relishing the thought of a kicking for the big audit firms. They might even be willing to help their Lordships to that end. Likewise the lobbying by the Big Four will be starting in earnest. This could prove a very uncomfortable time to be in a big firm.