This reflects the fact that the Bank of England is among the lowest cost central banks in the world - with a fraction of the staff of the Bundesbank, the Banque de France or the Federal Reserve System even when adjustment is made for differences in function. The charge will certainly now be significantly lower to reflect inter-alia the transfer of banking supervision to the FSA. But I recognise that whatever our costs we need to be accountable for the resources that we use and the burden we place on the banking system. We will now be more accountable to Court, to the Government that will set the charge, to the banks themselves and the wider public through our Annual Report. The Bank’s functions Below the Court the new Bank will be organised administratively into three main subdivisions, reflecting our responsibilities for monetary stability and financial stability, each under a Deputy Governor, with the third subdivision responsible for all forms of financial market operations, under a senior Executive Director. The central services of the Bank, including personnel and finance, will report to the Deputy Governor, Financial Stability, who will remain responsible for the day-to-day management of the Bank. The main changes in the Bill affect our monetary stability and financial stability functions, which I will discuss in turn. Monetary Stability Let me start with monetary stability - although the new arrangements may be familiar to you not least because they are in place already!
This process of regular and systematic assessment, based on the economic and financial data, is unimaginably different from the erratic reaction to financial market disturbances which characterised the conduct of monetary policy too often in the more distant past. And the reflective, interactive, debate within the Monetary Policy Committee is very different too from the sometimes exaggerated advocacy of a particular viewpoint which inevitably crept in to the Ken and Eddie show during which the Bank usually had at most an hour in which to persuade a sometimes reluctant Chancellor! The present arrangements allow us to explore, without initially taking hard positions, alternative possible interpretations of the data and their implications; and those discussions capture far better than before the uncertainties inherent in the conduct of monetary policy. It is, I think, how monetary policy really should be made. Transparency and accountability With operational independence comes - quite rightly in my view - even greater transparency and public accountability. The minutes of the two-day meeting at which that decision is taken, together with a summary of the information presented by the staff, are published in the week after the following meeting. Those minutes also record the individual votes of each member of the Committee. Beyond this, we publish a regular assessment of monetary policy - including a forecast of inflation over the two-year period that we believe is relevant, given the lags between policy actions and inflation outturns - in the Bank’s Quarterly Inflation Report.