Sunak and Bailey respond to questions on Cummings’ claim that HMT discussed emergency powers to direct the BoE during coronavirus (COVID-19)

Sunak and Bailey respond to questions on Cummings’ claim that HMT discussed emergency powers to direct the BoE during coronavirus (COVID-19)

The House of Lords Economic Affairs Committee has published correspondence with the chancellor of the Exchequer, and the governor of the Bank of England (BoE) concerning claims by Dominic Cummings that consideration was given to the use of ‘emergency powers’ by HM Treasury (HMT) to direct the BoE during the coronavirus (COVID-19) pandemic. The chair of the Committee, Lord Forsyth of Drumlean, wrote to Rishi Sunak and Andrew Bailey on 28 May 2021 asking for details of any meetings held on this subject and their assessment of Cummings’ evidence.

Bailey said a temporary revocation of monetary policy independence was never discussed with or within the BoE, and such a move would have been ‘a catastrophic mistake’ as it ‘would be throwing away nearly a quarter of a century’s progress in monetary stability’.

Sunak said neither he nor HMT officials attended meetings on the potential use of emergency powers to direct the BoE during the pandemic.

Sunak’s letter also discusses issues to do with interest rates and the Asset Purchasing Facility.

Sources: Letter from the chancellor of the Exchequer, Rishi Sunak MP, to the chair (10 June 2021)

Letter from the governor of the Bank of England, Andrew Bailey, to the chair (1 June 2021)

Letter from the chair to the chancellor of the Exchequer, Rishi Sunak MP (28 May 2021)

Letter from the chair to the governor of the Bank of England, Andrew Bailey (28 May 2021)

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