Business of the House

Oliver Colvile Excerpts

Thursday 20th December 2012 Commons Chamber

[Mr Lansley]

I do not know whether we have any immediate opportunity for such a debate. I recall that when the Chancellor of the Exchequer came here and made a statement announcing that appointment, it was welcomed right across the House, including by the hon. Gentleman’s Front Benchers. The truth of the matter, as the Chancellor clearly stated, is that if we want to get the very best person in the world for this job, we have to be prepared to put in place the contract to make that happen.

[Oliver Colvile (Plymouth, Sutton and Devonport) (Con)]

There has been a great deal of speculation in the press that the Government are going to review the inflation target that they set for the Bank of England. Indeed, the Bank of England has failed for some while now to hit that target. May we kindly have a debate or a statement on the criteria that the Treasury will use to work out the inflation target that the Bank of England should be trying to hit?

[Mr Lansley]

My hon. Friend knows, I hope, that we have no plans to change the inflation targeting framework that was set out in the Bank of England Act 1998. As he rightly says, for a significant period that target was not being met, but the framework makes that transparent because it requires the Governor of the Bank of England to write to the Chancellor to explain why it has not happened. Inflation has substantially reduced in the past year or so. Alongside the fiscal credibility of the Government, that gives international markets and businesses confidence in the credibility of our monetary policy too.