Top economist fears Bank of England independence is at risk

 
Tim Wallace
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THE TREASURY has been manipulating monetary policy by taking the profits from the quantitative easing (QE) scheme, gaining another £47bn in support from the Bank of England this year, a leading economist claimed yesterday.

The raid on profits has brought in £23bn for the government so far this year, according to estimates from Henderson Global Investors’ economist Simon Ward, and will bring in £24bn more in the second half of 2013. He fears the Bank’s independence is being undermined by the government’s actions.

“The MPC takes full account of cash transfers from the Asset Purchase Facility to the Treasury when setting monetary policy and does not think that these transfers affect its ability to set policy,” said a Bank spokesperson.