King was first appointed governor in July 2003 after being deputy governor from 1998 to 2003.
Alistair Darling says: “Mervyn King has played a key role in delivering macroeconomic stability in the UK and his leadership and experience will continue to prove invaluable to the Bank of England.”
Darling has also announced further details of the reforms to the Monetary Policy Committee appointments process. In future the Treasury will publish a timetable for appointment of an external MPC member before a vacancy becomes available, giving details of who it has decided to appoint allowing the Treasury Select Committee three months for their pre-commencement hearings.
In the event that an external member is reappointed for a further term, this intention will be announced sufficiently in advance of expiration of that member’s current term. Reappointed members will undergo a pre-commencement hearing in the same way that new members will, ensuring that all members are subject to regular parliamentary scrutiny.