Bank of England: National Debt

Debate between Lord Williams of Elvel and Lord Newby

Monday 24th June 2013 Lords Chamber

[Lord Williams of Elvel]

To ask Her Majesty’s Government what proportion of the national debt is currently held by the Bank of England.

[Lord Newby]

My Lords, Bank of England data state that the Bank of England’s asset purchase facility currently holds £326.3 billion of gilts by nominal value. This was equivalent to 24.1% of the total stock of gilts and Treasury bills at the end of March 2013.

[Lord Williams of Elvel]

My Lords, if the Minister were to consult Wikipedia, he would see that the figure is rather higher. Something like a third of the national debt is now owned by the Bank of England. Given this, does the Minister agree that in time this position must be unwound, and how will this be achieved?

[Lord Newby]

My Lords, this measure was taken to deal with the heart attack suffered by the British economy and over a period it will be unwound. This is a matter for the Monetary Policy Committee of the Bank of England to manage. At the point at which it feels it right to start unwinding, no doubt it will explain how it plans to do it.