View more on these topics

MPs attack Treasury for failing to understand QE risks

Treasury 480

MPs have hit out at the Treasury for indemnifying the Bank of England against losses from its £375bn quantitative easing programme, claiming it does not understand the risks involved.

The Public Accounts Committee published a report last week into the activities and role of the Treasury, in which committee chair and Labour MP Margaret Hodge criticises the Treasury for its “impenetrable” accounts.

Hodge says: “The Treasury has not convinced us it understands either the risks it has taken on by indemnifying the Bank of England against losses on QE or the expected economic benefits. Some £375bn has so far been injected into the economy as an ‘experiment’ but the department could not explain to us what the effect has been on the whole economy or on different parts of society.

“The Treasury acts as both the finance ministry and economic ministry. But it appears to neglect its role as finance ministry. Its own accounts are impenetrable and this committee keeps seeing instances of poor decision making by departments, which the Treasury could and should have prevented.”

IMLA executive director Peter Williams says: “Given the experimentation the bank and the Treasury have been engaged in regarding financial policy, nobody could be clear about the outcome.”

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment

    Close

    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm

    Email: customerservices@moneymarketing.com