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Thursday, June 19, 2008

Sir John Gieve Falls on His Sword

Sir John Gieve, the Deputy Governor of the Bank of England, has fallen on his sword and is standing down from his role next year; he is taking the flak for last year's Northern Rock fiasco.

Sir John was responsible for maintaining the stability of financial markets.

Sir John had been accused of being asleep at the wheel during the Northern Rock debacle. He is staying on until next year, until new legislation to deal with a failing bank is in place, at the request of the Chancellor and Mervyn King (the Governor of The Bank of England).

Sir John is stepping down 2.5 years early, after being appointed to the five year role in January 2006.

It is not clear as to whether he has been pushed or jumped from his role. However, it is clear that more than one man was responsible for the failure of governance last year that led to the Northern Rock fiasco. The fundamental failing is that of the tripartite system, set up by Gordon Brown, which does not have a single organisation with overall responsibility for oversight, control and stability.

The size of Sir John's payoff has yet to be revealed, doubtless it will be generous.

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