Former Labour minister Lord Myners has criticised the timing and extent of the government's planned spending cuts.
As peers continued debate on the Finance Bill, which enacts the Budget, following a short pause for a statement on policing reform on 26 July 2010, he said: "Cutting public expenditure when the economy still has excess capacity and high unemployment is a most unwise thing to do."
The former City minister added: "The level of cuts that is being proposed is draconian."
Lord Myners quipped: "This bill is part of a 'hair shirt' Budget. But it isn't a hair shirt that's going to be worn by those who buy their shirts in Jermyn Street."
But he also described Labour's decision to place its "golden rule" on public debt on hold as "unfortunate".
The bill completed all its Lords stages as peers do not have the power to amend or reject money bills.
It will receive Royal Assent on 27 July 2010.
Watch part one of the debate