II. ANSWERABILITY OR ACCOUNTABILITY?
7. Accountability is an
elusive concept and trying to find an accurate and comprehensive
definition is correspondingly difficult. The Public Service Committee
examined one aspect of accountability - Ministerial accountability
to Parliament - in 1995-96.
The Committee cited the classic doctrine as spelled out by Sir
Edward Bridges, the then Permanent Secretary to the Treasury,
in 1954: "executive powers are conferred by Parliament on
Ministers of the Crown.... Both in regard to these powers and
to others which derive from the prerogative and not from statute,
it has long been the established constitutional practice that
the appropriate Minister of the Crown is responsible to Parliament
for every action in pursuance of them."
The Committee, in its elaboration of the doctrine, saw Ministers
as owing a fundmental duty to account to Parliament in two specific
ways. First the Executive is obliged to give an account - to
provide full information about and explain its actions - in Parliament;
second the Executive must respond to concerns about its actions
because Members of Parliament are elected representatives of the
In this traditional sense of Ministerial accountability only
the Chancellor, not the Bank of England, can be directly accountable
to the House of Commons but we recognise that the Bank is answerable
for its actions in seeking to meet the inflation target and in
giving an account of its stewardship to the Committee.
8. The Cabinet Office in
its submission noted that functions could not be taken out of
the ambit of direct Ministerial accountability without the express
authority of an Act of Parliament. "Ministers remain directly
accountable to Parliament for their discharge of their responsibilities
under the relevant legislation. In the majority of cases these
responsibilities will include appointments, and securing funding.
Ministers also have an overall responsibility for their sponsorship
of, and policy towards, such bodies. As such they may be held
to account for the success of the institutional arrangements in
securing the envisaged policy and other benefits."
9. The Treasury in its evidence
drew attention to the "clear distinction between the roles
of the Government and the Bank of England. The Government is
responsible for achieving its economic goals and therefore it
sets the target for monetary policy. The Bank's job is to set
interest rates so that the monetary policy target is achieved.
Both are accountable for the performance of their respective
tasks." In the Treasury's view it "is not unusual in
a constitutional sense to delegate authority to public bodies
to execute certain functions at arms-length from the Government.
However it is for Parliament to approve the powers which are
10. Scrutiny of legislation
and the way in which the Government discharges its responsibility
under such legislation are not the only ways in which Parliament
can seek to hold the Executive accountable. One of the main opportunities
available to individual Members is the Parliamentary question.
Clearly under the new arrangements the Chancellor will not be
in a position to answer directly in the House of Commons questions
relating to those aspects of monetary policy, responsibility for
which has been devolved to the Bank of England but he will continue
to be directly accountable to Parliament in the traditional way
for those aspects of monetary policy for which he has retained
responsibility. We will be raising with the Procedure Committee
whether it will be possible for individual Members under the new
arrangements to raise all monetary issues on adjournment debates.
11. The opportunity for
a report to be debated in the House is another important method
of enhancing accountability. We share the view of the Liaison
Committee, as expressed on its report on the work of select committees
in the last Parliament, that six days should be provided each
session for debates on select committee reports.
We recommend the Committee on the Modernisation of the House
to consider how it can best enable more Committee reports to be
debated in the House and, in particular, to secure an annual debate
in the House in Government time on the Treasury Committee reports
on the Bank of England.
12. We recognise, however,
that Ministerial accountability is not the only paradigm for holding
organisations, or individuals, accountable. In his submission
to the Public Service Committee, Mr David Faulkner of St John's
College, Oxford, emphasised that accountability can "take
different forms - political, financial, managerial, operational,
legal, professional. It can be to different authorities, institutions
or individuals.......[It] can operate through direct supervision
or contact, through formal arrangements for reporting or consultation
(in public or in private), through procedures (such as complaints)
which can be activated when required ...Accountability should
take multiple forms and operate through multiple, and often reciprocal,
The Government envisages the Bank of England's "accountability"
or more precisely "answerability" as being to the non-Executive
members of the reconstituted Court, the Government, the Treasury
Committee, Parliament and the public at large.
13. The Treasury Committee's
responsibility in relation to monetary policy is to provide a
forum for it to be examined, by exposing to public scrutiny the
thinking and actions of those responsible for its formulation
and delivery. We believe that by bringing information into
the public domain we can help to clarify the issues and that rigorous
scrutiny of the basis for policy decisions will enhance the credibility
and effectiveness of the monetary policy framework as a whole.
The Bank can thus be held "accountable" to the public
as well as to Parliament through being more open and transparent
and by having to explain its actions in an independent forum.
It is in this respect that our Committee can most effectively
and most appropriately exercise its role of holding the Bank accountable.
We discuss in section IV how we intend to fulfil this responsibility.
12 Second Report from the Public Service Committee, Ministerial Accountability and Responsibility, Session 1995-96, HC313 Back
13 Ibid., para 8 Back
14 Ibid., para 32 Back
15 Appendix 5. Back
16 Appendix 4. Back
17 First Report from the Liaison Committee, The Work of Select Committees, Session 1996-97, HC 323, para 38. Back
18 Op.cit, para 170. Back
19 Appendix 2. Back