Bank of England (Appointment of Governor) Bill

Debate between Mark Durkan and Mike Freer

Friday 6th July 2012 Commons Chamber

[Mike Freer]

I certainly agree that the fixed-term appointment is a huge step towards independent stability. As I was trying to explain, what concerns me is that if the vacancy arose after a change of Government, the new governing party could seek to ensure that the new Governor was much more in tune with its own political views. I fear that both the appointment and the removal are much more likely to be politicised if the Select Committee gets its way.

[Mark Durkan]

The hon. Gentleman has suggested that the Government might have a partisan agenda in appointing the Governor. Surely the best way of protecting the appointment from the allegation that the Chancellor’s motivation was purely partisan is to give the Select Committee a role, whether the appointment is made at the start of a Parliament or, even more interestingly, at the end.

[Mike Freer]

The hon. Gentleman is absolutely right. I do not think that any appointment is without politics, but I fear that a Select Committee is much more likely to adopt a political method. We have recently seen Select Committee investigations involving minority reports, and the pursuing of party political agendas in the interrogation of witnesses.

[Mark Durkan]

Did the hon. Gentleman vote for a parliamentary inquiry yesterday? Did he support all the arguments that were advanced in its favour? He seems to be contradicting those arguments now.

[Mike Freer]

I did vote for a parliamentary inquiry, and I do not disagree with some of the points that the hon. Gentleman has made. However, I believe that a Select Committee’s role is to investigate. There is a huge difference between investigating issues and appointing executives with Executive powers who can intervene daily in monetary policy, and there is a significant difference between making such appointments and the interviewing of bank chief executives for wrongdoing.

I have not set myself against reforms. I have no doubt that the appointment of Governors and other senior public officials requires greater transparency than we have seen hitherto. What worries me is that, while pre-commencement hearings are a good thing, involving the Select Committee in the right of veto will not help and, indeed, could hinder the appointment of Governors. I believe that the Treasury Committee should have a voice but should not have a veto, and I therefore cannot support the Bill.