Select Committee on Treasury Minutes of Evidence

Examination of Witness (Questions 160 - 165)



Mr Fallon

  160. You are the Deputy Governor and you are responsible for financial stability which is of course part of the test, but you are also a key part of the monetary policy framework which would be dispensed with if we joined the euro. A series of tests has been set out and what is the important one for you or is there another one that you consider equally important?  (Sir Andrew Large) I think all the tests that are there are important, all the five.

  Chairman: Sir Andrew, let me put it this way: there are five tests, but which one stands out for you?

Mr Fallon

  161. What would you have to be satisfied with?  (Sir Andrew Large) They are all so very different. You have got unemployment, you have got questions of the cycle. They are chalk from cheese. I do not think you can say that one is more important than another.

  162. You have been a very senior banker and you will go on being a very senior banker in the Bank of England, so there must be one test—  (Sir Andrew Large) I am sorry, I have got views on all the tests of course. One is the efficiency of the financial services sector in the UK and that is completely different from questions of unemployment or whether the cycles have all come together as between the euro area and the UK and they are all quite different. I do not think it is possible to say one is more important than another.


  163. Does this come into your homework category, Sir Andrew?  (Sir Andrew Large) I am sure it does. Everything comes into my homework category, but I am not wanting to give you the impression that I am thinking lightly about all these various points. The fact of the matter is that you have got five tests there which, in different ways, are all important and in different circumstances, for different constituencies and different people. Some are important specifically for one thing, some for another. That is how it presumably was designed.

  164. Sir Andrew, thank you very much. We have run the course this morning and you have been very helpful to us. I hope it has been constructive to you as well.  (Sir Andrew Large) It has indeed, Chairman.

  165. You will have to write back to us with a few things and then when you appear before us again, we will see the effect of your homework.  (Sir Andrew Large) Thank you very much indeed.

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