Peter Rees was Chief Secretary to the Treasury and Trade Minister in Margaret Thatcher’s first two terms in office. Alongside Nigel Lawson as Chancellor, Rees was at the centre of Thatcher’s moves to cut public spending. He was no stranger to controversy, voting against his own Government and drawing the ire of Labour ministers when in opposition.

As a barrister he specialised in taxation law and he served as Shadow economics spokesman before the Conservative Party returned to power in 1979. He opposed the building of the Channel Tunnel, and it was this opposition to the Government’s plans that led to his standing down from the House of Commons.

Peter Wynford Innes Rees was born in 1926, the son of Major-General T. W. Rees, who served in the Indian Army, and grandson of a governor-general of Burma. He was educated at Stowe School and Christ Church, Oxford, before serving in the Scots Guards from 1945-48. He was called to the Bar in 1953 and spent his early career practising as a barrister, taking silk in 1969.

He unsuccessfully contested the safe Labour seat of Abertillery in 1964, where he won only 14 per cent of the votes, and lost a subsequent by-election by a similar margin the following year in the same seat. In the 1966 general election he stood in Liverpool West Derby but was once again unsuccessful. He finally became an MP when he was elected by the voters in Dover in 1970, unseating the sitting Labour MP — the Social Security Minister David Ennals — by a small majority. He remained the area’s representative until 1987, although the constituency name was changed to Dover and Deal in the general elections of February and October 1974, and back to Dover in 1983.

He began his political rise when he became parliamentary private secretary to Geoffrey Howe, the Solicitor-General, in 1972. Rees attracted headlines in March 1975 when, in a heated exchange in the Commons, he appeared to suggest that Denis Healey, the Labour Chancellor of the Exchequer, had arranged the cut-off point for capital transfer tax to suit the interests of Treasury ministers. Healey called him “an emotive little man” and demanded he withdraw the accusation, which Rees eventually did.

In November 1977 Margaret Thatcher promoted Rees from the back benches to become an opposition spokesman on Treasury and economic affairs. After the 1979 general election he kept his portfolio as a Minister of State at the Treasury in Thatcher’s first Cabinet, that brought a number of new faces into government, including Douglas Hurd, Leon Brittan and Nigel Lawson as junior ministers.

He hit the headlines again after a World in Action programme about the Rossminster Group, a financial organisation that was being investigated by the Inland Revenue over tax avoidance schemes. Rees had, in his opposition days, been an adviser and tax counsel to Rossminster. Labour MPs demanded his resignation because of his involvement with the group and an alleged conflict of interest in his role in charge of the Revenue. Thatcher, however, rejected such demands and defended Rees.

In 1981 Thatcher appointed Rees as Minister for Trade. It was an awkward portfolio to manage with the Reagan Administration threatening action against the British steel industry over alleged protectionism in Europe. The job did, however, have its lighter moments. On a trip to persuade the Russians to buy British in 1982, he visited a Moldavian wine factory with his Soviet counterpart, Yuri Brezhnev, son of the Soviet leader. A member of the British delegation was heard to describe the wine as nichevo, roughly translated as “so-so”, a not-so-diplomatic comment.

Rees made a reasonable success of the relatively unglamorous job of Trade Minister but his performance on the international stage was offset by domestic issues. Besides his troubles with Rossminster, he attracted criticism for overturning a Monopolies and Mergers Commission rating that Charter Consolidated should not be allowed to make a takeover bid for a Scottish mining engineering company, Anderson Strathclyde.

His performance at Trade was enough to persuade Thatcher to promote him in June 1983 to the post of Chief Secretary to the Treasury. The move placed Rees at the centre of the Prime Minister’s efforts to cut public spending, alongside the Chancellor Nigel Lawson. Rees had to negotiate departmental spending cuts and managed to reduce proposed spending to the level announced in the previous Budget. By 1985, though, spending was racing ahead of forecasts and he was not to remain in the Cabinet for long.

He stood down as Chief Secretary in September 1985 when Thatcher reshuffled her Cabinet. A year later he announced that he would not stand at the next election. As MP for Dover he found it increasingly difficult to reconcile support for the Government with his constituency interests, particularly because of his opposition to the proposed Channel Tunnel, and he was one of five Conservative MPs to vote against the tunnel.

The following year he was created a life peer in a post-election Queen’s Honours List that ennobled 19 former MPs including Francis Pym, Norman St John-Stevas and Keith Joseph.

After leaving the Commons Rees developed a business career. He was a name at Lloyd’s and was elected to its council in 1987. He held a number of corporate posts including the chairmanship of London and Scottish Marine Oil (Lasmo), an oil and gas exploration company, and directorships at the financiers James Finlay and General Cable. His years at Lasmo, from 1988 to 1994, were dogged by criticisms of the company’s performance. Lasmo experienced rapid growth and aggressive expansion abroad in the late-1980s but was adversely affected by the fall in oil prices. By the time that Rees stepped down as chairman in 1994, the company was selling assets, including a £123 million tranche to PowerGen. The start of Lasmo’s troubles followed its £1 billion acquisition of Ultramar in 1991. Within a year the market value of the merged company had fallen by about half, partly due to falling oil prices but also because of a re-rating of the merged company.

Rees is survived by his wife, Anthea.

Lord Rees, QC, Chief Secretary to the Treasury, 1983-85, was born on December 9, 1926. He died on November 30, 2008, aged 81