Select Committee on Treasury Appendices to the Minutes of Evidence


Letter from HM Treasury


  I thought it worthwhile clarifying our recent discussions on the accountability of the international financial institutions. The issue also came up in this week's session when Gus O'Donnell and Stephen Pickford gave evidence.

  As you know, the Board of Governors is the highest decision-making body in both the IMF and World Bank. In each institution these Boards are made up of one governor and alternate governor for each member country, with each being appointed by that member country. Whilst the Executive Boards are responsible for conducting day-to-day business, they do so on the basis of powers delegated to them by the Board of Governors, who have all powers of the IMF and World Bank vested in them. The Chancellor of the Exchequer, as a Governor of the IMF, is accountable to Parliament for the UK's relationship with the IMF. The Annual Report to Parliament on UK Operations at the IMF is an important channel of accountability to Parliament. The appearance of Stephen Pickford and Gus O'Donnell, as representatives of the Chancellor, at the Committee on Tuesday is further evidence of those accountability mechanisms working in practice.

  Following your enquiries about invitations to IMF and World Bank staff to give evidence, we have consulted the institutions' legal departments. They confirm that it has been the long-standing practice of both institutions that their officials and staff will not normally appear before formal sessions of parliaments of member countries or their committees. However, in some instances, the IMF Managing Director and Deputy Managing Directors have appeared, on a voluntary basis, before legislative bodies to give informal briefing on non-confidential matters in closed session. Such voluntary appearances have been premised on the understanding that the officials may not be compelled to disclose confidential information, are not under oath and no record is made. The President of the World Bank has also on occasion appeared before legislative bodies, for example when President Wolfensohn appeared before our International Development Select Committee.

25 January 2001

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