Monetary Policy
House of Lords
Lord Myners (Labour)
To ask Her Majesty's Government, further to the Written Answer by Lord Sassoon on 17 March (WA 99), what responsibility HM Treasury has for monetary policy and the rate of inflation.
Lord Sassoon (Commercial Secretary, HM Treasury; Conservative)
As laid out in the Bank of England Act 1998, it is the Monetary Policy Committee which is operationally responsible for monetary policy and maintaining price stability.
HM Treasury's responsibility, in line with the Act, is to specify at least once every 12 months how price stability should be defined and what the economic policy of the Government comprises. With respect to the monetary policy tool of quantitative easing, the framework for the asset purchase facility requires the Chancellor to authorise the overall limit on asset purchases. The Chancellor also authorises the continued operation of the facility. The Government confirmed in Budget 2011 that the asset purchase facility will remain in place for the financial year 2011-12.