If the model of the existing Monetary Policy Committee is followed, appointments to the MCC will automatically include the Governor and two Deputy Governors of the Bank of England, as is the case with the Monetary Policy Committee today. Likewise the Governor is still best placed to recommend the two internal members of the committee. However, unlike today, where the internal appointments are referred to the Chancellor of the Exchequer for approval, under the reformed system these internal members will instead be referred to a cross party group of MPs for approval. The intention is to provide democratic oversight and scrutiny of the appointment process by Parliament whilst reducing the powers of the Chancellor. Likewise, for the same reasons, the appointment of the four external members of the MCC will also be decided by a cross party group of MPs. In total, the MCC will be made up of nine members, which, with the exception of the Governor and the Deputy Governors, will serve three-year terms.
However, this structure simply follows the existing format of the Monetary Policy Committee. We’re very open to other ideas that would make such a committee more democratic, representative of society and accountable.
Posted in: 3. The Positive Money proposals