APPENDIX 7
Letter from HM Treasury
INTERNATIONAL FINANCIAL INSTITUTIONS AND
ACCOUNTABILITY
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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