Treasury has published the responses to the Government’s technical consultation on proposed changes to the governance of BoE (see FReD 24 July). It also introduced the Bank of England and Financial Services Bill (the BoE Bill), which includes the measures consulted upon, to the House of Lords for its first reading on 14 October. The Bill will:

  • improve the accountability and governance of BoE by making its court of directors a smaller, more focused unitary board;
  • move the Monetary Policy Committee (MPC) to a schedule of a minimum of eight meetings a year;
  • bring PRA within BoE, ending its status as a subsidiary, and establishing a new Prudential Regulation Committee (PRC);
  • make changes to the Financial Policy Committee (FPC) including making it a statutory committee of BoE, in line with the MPC and the new PRC;
  • bring BoE within the purview of National Audit Office value for money studies;
  • further strengthen coordination arrangements between the Treasury and BoE in protecting taxpayers and the wider economy from bank failures;
  • extend the SMR to all FSMA authorised persons, and introduce a duty of responsibility, superseding the reverse burden of proof. Treasury has published a supporting policy paper detailing the measures required to achieve this;
  • extend the scope of the Pension Wise guidance service to enable the provision guidance services to pensioners considering selling their annuities when new flexibilities are introduced in 2017; and
  • make technical changes to the Scottish and Northern Irish Banknote issuance regime to facilitate group restructuring (such as restructuring undertaken to implement ring-fencing).

The BoE Bill will undergo its second reading, comprising the general debate on all aspects of it, on 26 October. (Source: Treasury Publishes Responses to BoE Bill ConsultationHouse of Lords Introduction of the BoE Bill and Treasury Policy Paper on Senior Managers and Certification Regime)