Select Committee on Treasury Minutes of Evidence


Examination of Witnesses (Questions 180 - 183)

THURSDAY 13 JUNE 2002

RT HON SIR EDWARD GEORGE, MS KATE BARKER, MR DAVID CLEMENTI, MR MERVYN KING AND MR STEPHEN NICKELL

Mr Laws

  180. Could I just ask, possibly through you, Chair, Governor, we had the discussion early on about the relationship between the Minutes of the MPC meetings, the comments made at the press conference and the Inflation Report. Roger Bootle described this as a somewhat under explored area as well when we had our discussion with him earlier this week. I wonder whether, through the Chair, I could ask if it would be possible to get a note from the Bank just explaining the relationship between these three documents in terms of how they are drawn up and what the approval mechanism is within the MPC?
  (Sir Edward George) I will be very happy to provide such a note. It is a fairly short note, Chairman.[1]

  Mr Cousins: No Tower of London for you then.

Chairman

  181. Could I finish with a structural question, Governor. The MPC remit provides for its performance and procedures to be viewed by the Court on an ongoing basis with particular regard to ensuring the Bank is collecting proper regional and sectoral information. How does the Court go about this business, with what frequency? What comments has the Court made to the MPC most recently on the performance and procedure?
  (Sir Edward George) This is reported on in the Bank's Annual Report and perhaps we could draw your attention to the relevant passages in the Annual Report. David, you are much closer to that than I am. There is a statement by the non executive members of Court to the effect of what they have been doing, is that right?
  (Mr Clementi) There is. Under the Act they are required to look at the manner in which we go about our task. It is a separate non executive report in the Annual Report.

  182. I see it on page 33. The frequency therefore is once a year in the Annual Report, nothing more than that?
  (Mr Clementi) I think that would mislead you. Regularly at monthly intervals, because the Court meets every month, they will be exploring one individual aspect or another. They look carefully, for example, at our recruitment policies in the monetary policy area. They have been looking at our relationships with the agents. They regularly go out and visit agencies themselves. The report is, yes, annually but their work is on a fairly continual basis.

  183. We would like maybe a better feel, that is what I am getting at, maybe more frequent contact ourselves would be helpful. Thank you very much. Can I thank you for your appearance this morning. Mr Clementi, I realise that your term of appointment is up on 31 August. Now, I make no judgment whether you will be here next time or not, but if you are not here can I thank you very much for the assistance you have brought to the Committee in the past and wish you every success in the future, if indeed you are going to have another future after 31 August. I think that is pretty diplomatic. Can I thank Mervyn King in particular because I know you were under the weather this morning, you have had flu, but you did respond very vigorously to some of the questions and I thank you for that as well. One comment was made that the central banks are paid to worry, well if that is the case I think you all have put on a very, very brave face this morning. Thank you very much.
  (Sir Edward George) Thank you very much, Chairman.





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