RESOURCES AVAILABLE TO EXTERNAL
94. In 1999, the then Treasury Committee issued a
Report on Research Assistance for Monetary Policy Committee
Members after a public dispute about resources available to
'external' members. That Report cautioned the Bank to better manage
such future disputes.
One of the roles of the Court of the Bank of England is to ensure
that the MPC has adequate resources to undertake its work. The
then Treasury Committee, commenting on the episode which led to
the increase in resources to external members, concluded "We
believe that the Non-Executive Directors need to be much more
pro-active in ensuring that the procedures of the MPC operate
fairly with respect to both internal and external members".
95. We were therefore interested to hear the views
of those who had been on the MPC on the resources available. Dr
Wadhwani explained that "When I got there the quantum of
resource was not enough but that was resolved". He told us
that "There have been rumours around that there may be an
attempt to take these resources back from external MPC members
which I believe would be a retrograde step".
Dr Julius raised the concern that there in her time on the MPC,
it would have been useful "even after the expansion of resources,
[if there] was more modelling capability in the external MPC staff".
Ms Bell thought it would be wrong to "dilute" the resources
available to external MPC staff, describing the resources available
as "adequate" but not "overly-generous".
On the modelling capability available to the external MPC members,
she felt that there was no reason why people with economic modelling
experience could not be recruited to assist the external MPC members,
and at times had been.
96. Dr Potter outlined the procedure undertaken by
the Court to monitor the resources required by the MPC. This included
informal lunches, and a formal appearance by MPC members before
Court every three months.
His present opinion was that their data told them that things
were "pretty satisfactory".
He stated, on the question of whether there was going to be a
reduction in the resources available to external MPC members,
that "There is no such intention of which I am aware".
He also confirmed that MPC members had access to him if required
to express concerns about resources.
We welcome the assurance given to us by the Court of the Bank
of England that the resources available to external members of
the MPC are not under threat. We will continue to monitor both
these resources and the role of the Court in such matters.