In a worrying sign of Treasury incompetence and neglect, that bodes ill for its handling of the economy, it seems that the Treasury has allowed the contracts for three Bank of England Governors to expire.
John McFall, chairman of the Treasury Select Committee, is none too impressed with the slack attitude of the Treasury. He used the polite phrase "surprise and concern" to express his displeasure on hearing the news.
The three year directorships of Arun Sarin, Paul Myners and Geoffrey Wilkinson expired last week, leaving the members of the Bank's court in limbo.
At the eleventh hour the Treasury called each executive to assure them that their contracts would be renewed in due course.
Pretty pathetic, by even this government's standards of incompetence!
To add to the list of Treasury failings, wrt their handling of the Bank of England, they have yet to find a replacement for outgoing deputy governor Rachel Lomax, who leaves at the end of June.
John McFall is quoted in The Telegraph:
"The court is a key part of the Bank. It is the body which provides invaluable advice to the Governor and scrutinises the Monetary Policy Committee.
It is hugely important - and it is essential its members get adequate advance notice of their future and their positions.
This is a cause for surprise and concern, given that the Treasury has said it would be focused in the future on making timely appointments to the Bank."
One Treasury insider told The Telegraph:
"What is particularly worrying is everyone assumed the problem in previous years had just been that Gordon Brown tended to take a long time taking his decisions, and that things would get better under a new Chancellor.
If anything, things are now worse. There is an element of neglect here."
This ongoing neglect and incompetence by the Treasury does not bode well for the economic stability/prosperity of the UK.
Showing posts with label John McFall. Show all posts
Showing posts with label John McFall. Show all posts
Monday, June 02, 2008
Thursday, January 31, 2008
Who's In Charge?
Alistair Darling revealed his plans yesterday to "beef up" financial regulation, in the wake of the Northern Wreck fiasco.
Rather perversely, despite the Financial Services Authority (FSA) being given a drubbing for it slack lustre approach to the Northern Wreck fiasco, the government wants to give the FSA more powers.
Darling also rejected the Treasury Select Committee's call for the Bank of England to play a greater role in monitoring individual institutions. Instead the Government plans to legislate to make the Bank of England's role in financial stability more formal.
John McFall, the chairman of the Treasury Select Committee, was unimpressed and described the proposals as "vague".
He is quoted in The Independent:
"The financial stability links between the Bank of England and the Financial Services Authority didn't work, so we need that to be strengthened.
I am looking for a mechanism to increase the financial stability area and that is vague at the moment."
Darling has also proposed that authorities be allowed to give a bank covert support, in the event of a serious problem arising that would affect consumer confidence.
The fundamental weakness of the proposals are that:
1 They give more power to the FSA, which has yet to get its house in order
2 It still does not clarify who, within the tripartite system (Treasury, FSA and Bank of England), is in charge.
Until point two, at the very least, is addressed the financial markets will be exposed to more potential Northern Wrecks.
Rather perversely, despite the Financial Services Authority (FSA) being given a drubbing for it slack lustre approach to the Northern Wreck fiasco, the government wants to give the FSA more powers.
Darling also rejected the Treasury Select Committee's call for the Bank of England to play a greater role in monitoring individual institutions. Instead the Government plans to legislate to make the Bank of England's role in financial stability more formal.
John McFall, the chairman of the Treasury Select Committee, was unimpressed and described the proposals as "vague".
He is quoted in The Independent:
"The financial stability links between the Bank of England and the Financial Services Authority didn't work, so we need that to be strengthened.
I am looking for a mechanism to increase the financial stability area and that is vague at the moment."
Darling has also proposed that authorities be allowed to give a bank covert support, in the event of a serious problem arising that would affect consumer confidence.
The fundamental weakness of the proposals are that:
1 They give more power to the FSA, which has yet to get its house in order
2 It still does not clarify who, within the tripartite system (Treasury, FSA and Bank of England), is in charge.
Until point two, at the very least, is addressed the financial markets will be exposed to more potential Northern Wrecks.
Monday, June 25, 2007
Squeeze Coming
The UK will experience a squeeze in public spending in the coming years, but the government has not made the British public aware of the hard times ahead.
That at least is the view of the Treasury Select Committee, in their report on the forthcoming Comprehensive Spending Review.
The report states that the government is "too timid" in stimulating a national debate on public expenditure, and has said that it should give clear indications of the decisions it is taking.
Committee chairman, John McFall, said:
"Our report highlights that the years of plenty in public spending are drawing to a close. The Treasury has not done enough to prepare the public for the squeeze that lies ahead."
The CSR was announced in 2005, and was set up to determine how much money each government department is to receive in the 2008-2009, 2009-2010 and 2010-2011. It is expected to be published this autumn.
The committee noted that the pre-budget report forecasted real growth in public spending during the period covered by the CSR of approximately 2%, this is half the rate of growth provided for during the period covered by the four previous CSRs.
McFall said:
"It is clear that the settlements for many departments will be tight.
Overall rates of growth in public spending in recent years have been very high. By those recent standards, there will be a squeeze in the years to come."
The committee also recommended that the Treasury does a greater analysis into the overall impact of net migration on demand for public services in the UK.
McFall said:
"The Treasury told us that the fiscal benefit of inward migration is greater than the cost to public expenditure.
This may be the case, but the impact on public expenditure is uneven across the country, and this is an issue that requires cool analysis, not heated debate, and it is the job of the Treasury to promote and provide such analysis."
He added:
"It is vital that every effort is made to verify that efficiency gains are not being made at the expense of service quality if the public is to have confidence that these are genuine efficiency gains, and not just spending cuts in disguise."
Don't hold your breath, there is no way that this government will actively publicise hard times to come.
That at least is the view of the Treasury Select Committee, in their report on the forthcoming Comprehensive Spending Review.
The report states that the government is "too timid" in stimulating a national debate on public expenditure, and has said that it should give clear indications of the decisions it is taking.
Committee chairman, John McFall, said:
"Our report highlights that the years of plenty in public spending are drawing to a close. The Treasury has not done enough to prepare the public for the squeeze that lies ahead."
The CSR was announced in 2005, and was set up to determine how much money each government department is to receive in the 2008-2009, 2009-2010 and 2010-2011. It is expected to be published this autumn.
The committee noted that the pre-budget report forecasted real growth in public spending during the period covered by the CSR of approximately 2%, this is half the rate of growth provided for during the period covered by the four previous CSRs.
McFall said:
"It is clear that the settlements for many departments will be tight.
Overall rates of growth in public spending in recent years have been very high. By those recent standards, there will be a squeeze in the years to come."
The committee also recommended that the Treasury does a greater analysis into the overall impact of net migration on demand for public services in the UK.
McFall said:
"The Treasury told us that the fiscal benefit of inward migration is greater than the cost to public expenditure.
This may be the case, but the impact on public expenditure is uneven across the country, and this is an issue that requires cool analysis, not heated debate, and it is the job of the Treasury to promote and provide such analysis."
He added:
"It is vital that every effort is made to verify that efficiency gains are not being made at the expense of service quality if the public is to have confidence that these are genuine efficiency gains, and not just spending cuts in disguise."
Don't hold your breath, there is no way that this government will actively publicise hard times to come.
Thursday, November 16, 2006
UK Government Must Knock Heads Together
The Parliamentary Treasury Committee inquiry into banking services for the poor has noted that the UK government needs to clamp down on illegal money lending, raise competition in home credit markets and improve access to financial advice for millions of poorer people.
John McFall MP, who headed the inquiry, said:
"Many of the financial services that most people take for granted are either not available to many of the most vulnerable in our society or are only available at a premium."
The committee noted that financial advice was not widely available, and that 8 million people earning between £10K and £22K found it difficult to get advice that wasn't linked to commissions and the sales process.
Mr McFall recommended that the Treasury should take the lead in brokering an agreement with the Financial Services Authority and the financial industry, to organise a framework for a national financial advice network.
The committee also stated that it expected the government to take a tougher line against illegal lenders.
McFall said it was for the government to "knock heads together" to ensure that there is progress among lenders in sharing data.
John McFall MP, who headed the inquiry, said:
"Many of the financial services that most people take for granted are either not available to many of the most vulnerable in our society or are only available at a premium."
The committee noted that financial advice was not widely available, and that 8 million people earning between £10K and £22K found it difficult to get advice that wasn't linked to commissions and the sales process.
Mr McFall recommended that the Treasury should take the lead in brokering an agreement with the Financial Services Authority and the financial industry, to organise a framework for a national financial advice network.
The committee also stated that it expected the government to take a tougher line against illegal lenders.
McFall said it was for the government to "knock heads together" to ensure that there is progress among lenders in sharing data.
Friday, November 10, 2006
Financial Services Authority Heavily Criticised
The Treasury committee has criticised the Financial Services Authority's (FSA) regulation of financial advertising, and said that the FSA should copy the policy of the Advertising Standards Authority (ASA) and make its findings public.
Committee chairman John McFall MP has written to the FSA chairman, Sir Callum McCarthy, complaining about its methods.
The FSA said:
"As a regulator we have a formal procedure we have to go through - we can't just issue a formal censure of a firm."
In contrast, the ASA publishes its rulings on its web site.
McFall said that the financial regulator should follow suit:
"The FSA has, at the moment, a seemingly far less transparent system in regard to financial advertisements, with no publication of complaints, and little public record of which companies have broken the rules.
This means consumers seem to get a worse deal, with the FSA offering no public scrutiny and little incentive for advertisers to keep to the rules.
The FSA needs to take a far more robust approach by highlighting poor practice."
Committee chairman John McFall MP has written to the FSA chairman, Sir Callum McCarthy, complaining about its methods.
The FSA said:
"As a regulator we have a formal procedure we have to go through - we can't just issue a formal censure of a firm."
In contrast, the ASA publishes its rulings on its web site.
McFall said that the financial regulator should follow suit:
"The FSA has, at the moment, a seemingly far less transparent system in regard to financial advertisements, with no publication of complaints, and little public record of which companies have broken the rules.
This means consumers seem to get a worse deal, with the FSA offering no public scrutiny and little incentive for advertisers to keep to the rules.
The FSA needs to take a far more robust approach by highlighting poor practice."
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