Question to the HM Treasury:

To ask the Chancellor of the Exchequer, with reference to his (a) letter to the Governor of the Bank of England on the remit and responsibilities of the Financial Policy Committee, dated 22 November 2023 and (b) correspondence entitled Financial Policy Committee Remit and Recommendations: Autumn Statement 2022, published on 17 November 2022, for what reason his letter dated 22 November 2023 did not include climate change and energy security in his four priorities for the Committee.

The Chancellor of the Exchequer is responsible for setting the Remit for the Financial Policy Committee (FPC) once per year, and may also make recommendations regarding matters the FPC should consider as relevant to its primary financial stability objective and its secondary objective to support the Government’s economic policy.

The FPC's remit is an important accountability mechanism to ensure the Committee has a clear framework through which it can make policy decisions and consider any trade-offs. This is important given the complexity of the FPC’s work.

Yearly updates to the Remit ensure that it reflects the current economic context, the Government’s policy, as well as the FPC’s responsibilities and powers. Climate change is stated clearly as an important part of the FPC's remit: both due to the relevance of climate related risks to the Committee’s primary financial stability objective, and because increasing long-term energy security and delivering Net Zero is set out as a key component of the government's economic policy. The Committee has a secondary objective to support the Government's economic policy.