HC Deb 03 June 1997 vol 295 cc151-2W
Mr. Jack

To ask the Chancellor of the Exchequer if he will list the reasons for transferring departmental management from the Bank of England to the Treasury; and if he will make a statement illustrating the operational implications and benefits arising from this change. [1874]

Mrs. Liddell

[holding answer 2 June 1997]: The Chancellor's statement granting the Bank of England operational responsibility for setting interest rates means that it is important to separate full policy responsibility for the Government's debt and cash management from monetary policy. The separation is intended to ensure that debt and cash management decisions are taken in such a way as to minimise the cost of financing the Government's borrowing needs subject to risk and are not influenced by short-term monetary policy considerations (and vice versa). The Treasury and the Bank are now engaged in working out the operational details of the transfer.

Mr. Mitchell

To ask the Chancellor of the Exchequer which other European Community Governments make use of advances from their central banks similar to the ways and means advances to Her Majesty's Government from the Bank of England. [1525]

Mrs. Liddell

No other Government of member states of the European Community operate an overdraft facility with their central bank similar to Ways and Means advances.

Mr. Mitchell

To ask the Chancellor of the Exchequer if he will make a statement on the manner in which ways and means advances from the Bank of England to the Government operate. [1531]

Mrs. Liddell

Government borrowing operations are conducted through the National Loans Fund. If the Fund is in surplus, the surplus is deposited with the Banking Department of the Bank of England. If the Fund is in deficit, the deficit is met by borrowing, known as ways and means borrowing, from the Bank's Issue Department. These arrangements enable any differences between the Fund's daily outgoings and its receipts to be offset without formality by changes in the deposit balance or ways and means borrowing.

Mr. Jack

To ask the Chancellor of the Exchequer what factors will be taken into account by the Court of the Bank of England when it reviews the performance of its Monetary Policy Committee; and if he will make a statement. [1867]

Mrs. Liddell

[holding answer 2 June 1997]: In reviewing the performance of the MPC in meeting its monetary policy objective of price stability, the Court will have particular regard to whether the Bank is collecting proper regional and sectoral information. The Court itself is to be reformed to ensure that it is representative of the whole of the United Kingdom.

Mr. Jack

To ask the Chancellor of the Exchequer if he will publish the voting decisions of each member of his new monetary policy committee when actions are taken to achieve the Government's inflation target. [1866]

Mrs. Liddell

[holding answer 2 June 1997]: The Monetary Policy Committee meetings will be minuted, and the minutes, including a record of the votes, will be released no later than six weeks after the meeting.

Mr. Vaz

To ask the Chancellor of the Exchequer when he expects to announce the name of the new Deputy Governor of the Bank of England. [1489]

Mr. Gordon Brown

I will make an announcement in due course.