The investigation will examine whether the fiscal authority has “appropriate” governance structures in place, and how it is held accountable for its actions.
MOSCOW, March 3 (Sputnik) – The British Parliament has launched a measure to review the independence of the Bank of England (BoE), which is timed to mark the 25th anniversary of the passage of the law giving the central bank the power to set interest rates.
The House of Lords Economic Affairs Committee has issued a call for written submissions examining “how operational independence” of the Bank of England works. A formal meeting will be held on March 7.
The committee said the investigation would focus on the Bank of England’s mandate, not the assessment of individual policy decisions. It will examine whether the fiscal authority has “appropriate” governance structures in place, and how it is held accountable for its actions.
The committee gave no other reason for the review than the anniversary of the 1998 Bank of England Act, but Conservative politicians repeatedly questioned the central bank’s independence last year, suggesting it could be reduced to allow the government to better control inflation.
The Bank of England’s operational independence allows it to choose how to meet the government’s inflation target. It raised interest rates for the tenth time in February since the end of 2021, which raised borrowing costs. The next interest rate decision is set for March 23rd.
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