Under a proposal by Chancellor of the Exchequer George Osborne, the National Audit Office will work closer with the Bank of England to provide “transparency and accountability” to the central bank, reports Bloomberg Business.
In a consultation paper, Osborne highlighted a few initiatives that will be put in place to restructure and enhance Britain’s regulatory structure. Among his plans, the Prudential Regulation Authority (PRA) will become a crucial part of the bank’s system and will no longer be seen as a subsidiary with its own board.
A new Prudential Regulation Committee (PRC) will also be working in tandem with the central bank’s Monetary Policy Committee, which is responsible for interest rates, and a Financial Policy Committee. The government said in addition to the PRC’s new duties, it would still be able to make rules, policies and supervisory decisions.
"Ensuring the Bank is well positioned to fulfill its vital role of overseeing monetary policy and financial stability is a key part of the government's long term economic plan," Osborne said in his paper.
The government is also looking to restructure the role of the central bank’s deputy governors and other top staff members without parliamentary approval.
The audit office will be equipped with the necessary resources to conduct “value-for-money” studies of the bank, the proposal said. “The measures in the Bank of England Bill will ensure that the bank is on the best possible footing to oversee its expanded remit,” Osborne said. The consultation period ends in September before the proposed law is voted on by Parliament later in the fall.
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