§ Mr. RentonTo ask the Chancellor of the Exchequer what assessment he has made of the effect on the United Kingdom banking system of the TARGET clearing system proposed for the euro. [3095]
§ Mrs. Angela KnightTARGET—trans-European automated real-time gross settlement express transfer—will be a payment system to allow high-value euro payments to be settled in real time rather than at the end of the trading day in the European Community. Real-time gross settlement systems in member states which participate in the single currency will be interconnected. Real-time gross settlement systems of member states which do not adopt the single currency will be able to connect to TARGET to process the euro as a foreign currency. It is not yet apparent to what extent TARGET will be used in preference to other payments systems by banks in the United Kingdom, whether or not the United Kingdom adopts the single currency.
The European Monetary Institute has responsibility for developing TARGET and work is continuing on many of its operational details. The final decisions on TARGET will be for the governing council of the European central bank. The Bank of England is fully involved in preparatory work in the EMI and the Governor of the Bank of England is a member of the council of the EMI.