Select Committee on Treasury Third Report

2  Appointment of Sir John Gieve

Background to the appointment

5. The Bank of England announced on 17 October 2005 that Sir Andrew Large, Deputy Governor for Financial Stability, was to leave the Bank of England in January 2006. On the same day, the Treasury announced that Her Majesty the Queen was pleased to appoint, under the Bank of England Act 1998, Sir John Gieve to succeed Sir Andrew as Deputy Governor for Financial Stability—and, therefore, as a member of the MPC.[3]

6. Sir Andrew Large served as Deputy Governor and as a member of the MPC from 3 September 2002 to 16 January 2006. We would like to thank him both for his service as Deputy Governor with responsibility for financial stability and for his contribution to the work of the MPC, in which capacity he has given evidence to us and our predecessors.

Background to Sir John Gieve

7. Sir John Gieve joined the Civil Service in 1974, working in the Department of Employment. He moved to HM Treasury in 1979, where he worked in a variety of roles, including Press Secretary, Principal Private Secretary between 1989 and 1991 to the Chancellor of the Exchequer, Managing Director of Public Services and Managing Director of the Financial Regulation and Industry Directorate. Sir John became Permanent Secretary of the Home Office in April 2001 and he remained in this role until December 2005. Sir John's Curriculum Vitae is published with this report.

Role as Deputy Governor

8. In his new role as Deputy Governor, Sir John will be responsible for financial stability. This includes ensuring that the overall financial system is safe and secure and that threats to financial stability are detected and reduced. Maintaining financial stability is important to maintaining the United Kingdom's position as a leading international banking and financial centre. Challenges associated with the role will include examining the impact of the rapid growth, in recent years, of new complex and risky financial products, monitoring the influence of less mainstream investors, such as hedge funds, and addressing wider security concerns following the events of 11 September 2001 in New York and 7 July 2005 in London. Sir John will also take responsibility for the oversight of payment systems—a crucial part of the financial system, as they facilitate transactions between individuals, businesses and financial institutions.

9. We questioned Sir John on the robustness of the UK financial system and the need for new banking controls around recent financial innovations.

Role as member of the MPC

10. As a Deputy Governor of the Bank of England, Sir John Gieve will also become a member of the MPC. In view of the economic and political importance of the MPC, there is a considerable degree of informed interest in both the general stance of its members and their individual positions at meetings. MPC members play a key role in representing that body to a wide range of audiences around the country and in gathering views from market participants.

11. We therefore questioned Sir John about his general stance on interest rate decisions and his approach to such matters as inflation expectations and the impact of high oil prices.


12. Sir John Gieve brings relevant experience to the position of Deputy Governor, including from his spell as Permanent Secretary in the Home Office. He has worked extensively on financial stability and regulatory issues during his time at the Treasury, which will be relevant to his responsibilities at the Bank of England. We are satisfied that Sir John fulfils the criteria for appointment. We wish him every success in his new roles as Deputy Governor of the Bank of England and as a member of the MPC.

3   HM Treasury press notice, Bank of England appointments, 17 October 2005 Back

previous page contents next page

House of Commons home page Parliament home page House of Lords home page search page enquiries index

© Parliamentary copyright 2006
Prepared 14 February 2006