Examination of Witness (Questions 160
WEDNESDAY 25 SEPTEMBER 2002
160. You are the Deputy Governor and you are
responsible for financial stability which is of course part of
the test, but you are also a key part of the monetary policy framework
which would be dispensed with if we joined the euro. A series
of tests has been set out and what is the important one for you
or is there another one that you consider equally important? (Sir
Andrew Large) I think all the tests that are there are important,
all the five.
Chairman: Sir Andrew, let me put it this
way: there are five tests, but which one stands out for you?
161. What would you have to be satisfied with? (Sir
Andrew Large) They are all so very different. You have got
unemployment, you have got questions of the cycle. They are chalk
from cheese. I do not think you can say that one is more important
162. You have been a very senior banker and
you will go on being a very senior banker in the Bank of England,
so there must be one test (Sir Andrew Large)
I am sorry, I have got views on all the tests of course. One is
the efficiency of the financial services sector in the UK and
that is completely different from questions of unemployment or
whether the cycles have all come together as between the euro
area and the UK and they are all quite different. I do not think
it is possible to say one is more important than another.
163. Does this come into your homework category,
Sir Andrew? (Sir Andrew Large) I am sure it does. Everything
comes into my homework category, but I am not wanting to give
you the impression that I am thinking lightly about all these
various points. The fact of the matter is that you have got five
tests there which, in different ways, are all important and in
different circumstances, for different constituencies and different
people. Some are important specifically for one thing, some for
another. That is how it presumably was designed.
164. Sir Andrew, thank you very much. We have
run the course this morning and you have been very helpful to
us. I hope it has been constructive to you as well. (Sir
Andrew Large) It has indeed, Chairman.
165. You will have to write back to us with
a few things and then when you appear before us again, we will
see the effect of your homework. (Sir Andrew Large)
Thank you very much indeed.