Treasury Select Committee chairman Andrew Tyrie has welcomed changes to Financial Policy Committee’s code of conduct in a letter to its chairman and Bank of England governor Mark Carney.
Andrew Tyrie had previously asked for clarification over the code’s operation, in particular in relation to the business and political connections of former Goldman Sachs banker Richard Sharp, who was appointed as an independent member of the FPC.
In response, the Bank has introduced an annual review of members’ business interests, and amended the FPC’s code of conduct to provide additional guidance on party political affiliations.
Commenting on the correspondence, Mr Tyrie said: “The FPC is a relatively new body with a wide range of powers so members must be – and be seen to be – independent.
“The governor’s decision to institute an annual review of FPC members’ business interests and introduce closer scrutiny of all changes to those interests is welcome.
“The proposed amendments to the FPC code of conduct to provide guidance on party political interests is another step forward. Making the FPC’s operations more transparent will strengthen the credibility of its decisions.”
Mr Tyrie had written to Mr Carney raising questions around Mr Sharp’s connection with asset-backed special opportunities investment firm Roundshield Partners. It asked Mr Sharp about his previous donations to a political party and what guidance was given to FPC members about political activity transparency.
The Treasury Committee’s report on the appointment of Mr Sharp concluded: “Noting that he himself has recognised that he will need to acquire technical knowledge, we are satisfied that Mr Sharp has the professional competence and personal independence to be an external member of the Financial Policy Committee.”
Earlier this month FTAdviser sister title the Financial Times reported that MPs had voiced fears over the balance of power on the FPC board.
