Don's diary

April 14, 2000


Francis Maude, shadow chancellor, invites me to take part in a policy group he is setting up to look again at the Tory policy of opposition to Bank of England independence. I accept. Meet on the terrace at the House of Commons with the shadow financial secretary, Oliver Letwin. We agree the modus operandi and start to put together a suitable list of well-informed independent people who might want to contribute as witnesses.


Former Bundesbank president agrees to help, as does the former chairman of the Federal Reserve. Hearings start with representatives from business pressure groups and the economics editor of the Financial Times, who sends a well written six-pager. Some members of the commission are impressed by the paper, academic members less impressed. Hearing of Tory MPs throws out a surprisingly diverse set of views.


We have a hearing of the academic witnesses that looks a little like a reunion of the government's seven "wise men". They are outraged by the decision to cut funding for macroeconomic modelling just when it is most needed. The debate is robust and the usual partisan views are rehearsed. I decide which side I am on and retire to the Red Lion with one or two to continue discussions. Not able to attend the hearing of the business and City economists due to family illness.


Written submissions including four from members of the monetary policy committee begin to appear in healthy numbers. Lunch at a gentleman's club to discuss progress. Everyone present is pleased.


First draft of the report is produced. Few changes other than typos and points of emphasis. I begin to think it is all too easy.


Business and City economists furnish me with a heavy debriefing about the hearing I missed. They are encouraging and provide pointers in the right direction. Michael Portillo takes over as shadow chancellor and announces the preliminary results of the report - that the Tories now accept Bank of England independence. This appears premature when one of the commissioners decides to unilaterally rewrite the document. Extensive discussions of economic theory take place. I lose the finer points of the argument on a vote, after our "expert" hints at a strategic non-signing of the final draft. I am consoled by a supportive wink from Portillo for a sterling defence of my position. Heavy redrafting begins - though the central point, support for independence, remains unchanged.


Heavy redrafting continues. Frustratingly, it is mostly style. Finally prevail over the word processor's American grammar check and the final draft is agreed.

Good press coverage. Tories off the hook. Huge sighs of relief all round.

Geoffrey Williams is a research fellow at the London Business School. He was secretary to the independent Bank of England Commission, set up by the Conservative Party to review its policy on the bank's independence.

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