GOVERNMENT RESPONSE TO THE TREASURY COMMITTEE'S
INTERNATIONAL MONETARY FUND: A BLUEPRINT FOR PARLIAMENTARY ACCOUNTABILITY
The Government welcomes the Fourth Report from the
Treasury Committee, which makes a valuable contribution to the
debate on the accountability of the International Monetary Fund.
(a) We welcome the establishment of the Independent
Evaluation Office and we look forward to reading its reports and
commenting upon its work in our future reports. We recommend that
the Fund continue to make its operations and policies as transparent
as possible (paragraph 8).
The Government agrees that the setting up of an Independent
Evaluation Office at the IMF has been a fundamentally important
development in improving the institution's
transparency, openness and accountability. This is a development
that the UK has been advocating for a number of years, and we
will continue to work to ensure that it functions as an effective
evaluation body. The Government welcomes the appointment of Mr
Montek Singh Ahluwalia as head of the Evaluation Office and look
forward to its regular reports to the IMFC, which will be published.
The Government is committed to enhancing transparency,
both in the UK and internationally. The Government welcomes the
ongoing measures to improve transparency and accountability at
(b) We recommend, in the interests of greater
transparency and accountability, that the Treasury press the Fund
to change its policy to allow its most senior officials to appear
on the record before Parliamentary Committees of member countries
The Government acknowledges that the policies at
both the IMF and the World Bank regarding the appearance of staff
to give evidence to parliamentary committees need further clarification.
Stephen Pickford wrote to both the IMF and the World Bank on 1
June 2001 passing on the conclusions of the Committee's
report and suggesting that the Managing Director and/or President
be free to decide, in consultation with member country authorities,
whether to give evidence to such committees themselves, and when
they are unable to do so, to be able to delegate as appropriate.
His letter is attached. We will forward the response on to the
committee as soon as we have it.
(c) We intend to continue to hold hearings with
the UK Executive Director and to publish reports on the IMF on
a regular basis and we recommend that our equivalent committees,
in other member countries, play a similarly active role in holding
their own representatives at the IMF to account (paragraph 13).
The Government welcomes the interest that the Treasury
Committee has shown in this area, and recognises the value of
the Executive Director continuing to meet the committee on a regular
basis. This is an important mechanism for improving accountability
in the UK's
relationship with the IMF.
(d) We welcome the
acceptance of our proposal for publication of an annual report
on the work of the IMF, and on other activities of the Fund, and
note the improvements which have been made to this year's
report. We recommend that, in the interests of transparency, such
reports should continue to be published annually (paragraph 14).
The Government agrees that an Annual Report to Parliament
on UK operations at the IMF increases the transparency of our
operations and improves accountability to Parliament and the public.
We published our most recent report in January 2001 and the Treasury
intends, as recommended by the Committee, to publish our next
report at a similar time next year.
(e) We strongly recommend that the Chancellor
push for a full publication of the Executive Board meeting minutes
and begin to publish the UK voting record at the IMF immediately
The Government is committed to reporting to Parliament
regularly on the position the UK takes on major policy issues
discussed at the IMF. It believes that the best way to do so is
within the Annual Report to Parliament. The improvements made
to this year's
report demonstrate our continued commitment in this regard. Following
recommendation, future reports to Parliament will include the
position on each vote made by the IMF's
Board of Governors in the reporting period.
In most instances decisions are made in the Executive
Board through a process of consensus-building, without recourse
to formal voting. But the Government is committed to taking further
steps to promote transparency in the Executive Board. Firstly,
in those cases when all Executive Directors are asked to record
a formal vote, we will publish the UK's
vote in the Annual Report. Secondly, in all cases, including those
where there is no vote, we will provide an explanation of the
position taken by the UK Executive Director in Board discussions,
except where it is judged to be not in the public interest to
do so, for example where the UK's
position is market sensitive.
The Fund currently publishes summings up of Board
discussions on all major programme discussions and policy issues,
as well as many Article IV surveillance discussions. However,
formal minutes recording the position taken by all Directors are
not released, since the Board has up to now taken the view that
this would be detrimental to the process of consensus-building
within the Board.
Nevertheless, we shall also continue to work to encourage
other countries to make their relationship with the Fund more
The Government is committed to enhancing transparency
at the IMF, reflected in the April communiqué of the IMFC,
which welcomed the 'ongoing
measures to improve transparency, governance and accountability
in the Fund'.
The IMF has taken steps to increase its institutional transparency
and accountability, through wider dissemination of information
about its policies and operations, and increasing contacts with
outside groups. The Annual Report to Parliament details these