Treasury committee chairman sends BoE warning

Andrew Tyrie, head of the influential Treasury select committee, called for committees such as his to be given a veto over the appointment of new BoE governors.

In a speech to the Institute for Government (IoG) on the future of parliamentary select committees, Mr Tyrie said: "With the new powers being conferrred on it, the Bank will shortly be by far the most powerful quango in the land."

He said he agreed with the IoG's recommendation that select committees and parliament should play a greater role in confirming appointments of the most senior regulators, ombudsmen, inspectors and constitutional watchdogs.

Select committees should certainly have a say in appointments where the credibility of the body in question depends upon its independence from government, Mr Tyrie added, which would therefore apply to the governorship of the BoE.

This was one of the issues that will be examined in a forthcoming inquiry into the accountability of the BoE, he declared.

His Treasury select committee's recent examination of the government’s proposals for reform of financial services regulation raised a number of serious concerns, including that there was insufficient detail about the considerable powers to be given to the BoE, and that there needed to be far more thought about the accountability of the new regulators.

The BoE will house two of the three new regulatory bodies formed from the disbanding of the Financial Services Authority: the Prudential Regulatory Authority and the Financial Policy Committee.