David Walton’s death leaves the monetary policy committee with seven members instead of its complement of nine.
The committee has been operating with eight members for the past three months since Richard Lambert left in March to head the CBI employers’ organisation. The quorum is six members.
Gordon Brown is expected to appoint a replacement for Mr Lambert shortly, or at least well before parliament’s summer break.
The MPC comprises four external members, appointed by the chancellor, and five Bank staff. Mr Walton and Mr Lambert were both external members, as was Professor Stephen Nickell, who left at the end of May, after serving two three-year terms, to head Nuffield College, Oxford. Mr Lambert turned down a second term.
According to Whitehall officials, the Treasury’s delay in choosing a replacement for Mr Lambert was because of the emphasis it placed on finding a candidate of the right calibre in a specialist area.
Under the system that has operated since 1997, when the committee was created, four members are selected directly by the chancellor. The Bank’s governor and his two deputies are “Crown appointments’’, made by the Queen, but – crucially – picked from names proffered by the chancellor and the prime minister. So, arguably, the chancellor controls the appointment of seven members, not four.
This area appears to be a sensitive issue inside the Bank. In January, Mr Brown lobbied for Sir John Gieve, a former permanent secretary of the Home Office, to succeed Sir Andrew Large as one of the deputy governors. Sir John joined the Bank in January but his appointment has been seen as increasingly embarrassing for the Bank, in part because of the emergence of a series of scandals at the Home Office during his tenure.
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