Since April 2013 Court has been required by Paragraph 12 of Schedule 1 of the Bank of England Act to publish minutes of its meetings. The Act also provides that Court may withhold information from publication where this would in its opinion be against the public interest. Material has been withheld from publication under this provision and, absent further action by the Court, would not enter the public domain until normal archive release after 20 years. However at its meeting in December 2015, Court adopted a process for keeping past redactions under review. At its meeting in December 2021 Court decided that a number of items withheld in 2019 should no longer be withheld and these are reproduced below, with context where necessary. A further review, of items redacted in 2020, will be undertaken December 2022.
Text in bold has already been published.
12 February 2019
…the PRA often had a position on actuarial issues and was a large employer of actuaries.
Sir Jon Cunliffe added that the Treasury was considering the balance of regulatory powers as the roles of the European agencies were returned, and that this issue could arise in the context of new, post-Brexit legislation.
8 April 2019
Minutes and Matters Arising
The Governor advised Court of some forthcoming role changes among the Executive Directors. James Proudman (ED UK Deposit Takers) would be leaving the Bank in July. He would be succeeded by Sarah Breeden (ED International Banks), who would be succeeded by David Bailey (ED Financial Market Intermediaries). Gareth Ramsay would be moving to take overall responsibility for the Bank’s Data initiatives in a newly created Executive Director role. The ED roles in FMI and Communications would be advertised internally and externally. Andy Haldane, the Bank’s Chief Economist, would have additional responsibilities arising from the Future of Finance initiative while ceding responsibilities for advanced analytics, which would be consolidated under Gareth Ramsay.
(a) Annual Report Text
(Gareth Ramsay, Lea Paterson, Sanam Conway and Vijay Reed)
Court reviewed a draft text of the Annual Report. Court members suggested alternative ways of presenting some of the HR data and the listings of Court and Committee members. It was agreed that the HR and CSR sections would be rationalised to avoid repetition, and that appropriate emphasis should be placed on the Bank’s significant investment in education and outreach activities. The sections on value for money should lead with the Bank’s current initiatives. Members would send more detailed drafting comments direct to the Annual Report team and the full report would be brought for approval in May.
Court approved amendments to the terms on which the Bank’s premises could be used for events to support charities.
21 May 2019
£50 Polymer Project
(Sarah John and Andrew Baker)
Court approved the award of contracts for the supply of polymer substrate and security foil for the next £50 note:
- Award of a Polymer Supply Framework Agreement to both CCL Secure Limited (CCL) and De La Rue International Ltd (DLR)
- Award of the first polymer call-off contract for the £50 to CCL 55% and DLR 45%
- Award of a foil supply contract to Kurz
- Delegated approval for the Deputy Governor for Monetary Policy to sign the contracts, subsequent call-off contracts and related documents
Court noted that the cost of the £50 substrate factored in supplier initiatives to reduce environmental impact, and improve diversity and inclusion, which was consistent with the Bank’s broader strategy in these areas.
4 July 2019
(Rob Thompson and Chloe Iles)
…. and staffing levels 113 below the 4,231 cap. Ms Place commented that the figures did not reflect a number of cost pressures that were building up over time, and Mr Broadbent added that low attrition rates would put pressure on the headcount targets. Ms Thompson commented that it was important not to confuse the BAU run rate with investment spending, part of which would be charged through depreciation costs in the future. The Chair said that there would be a further discussion of the financial position in September.
13 September 2019
IEO Research Update
(Melissa Davey, Andy Haldane, Misa Tanaka, Mhairi Burnett, Andy Moorhouse and Nora Wegner)
Court reviewed the main themes and recommendations emerging from the IEO’s review of research in the Bank. The emerging themes were (1) clarifying the role of research in supporting the Bank’s mission; (2) providing more clarity on career paths for researchers; and (3) ensuring that the right structures and resources (eg technology) were in place to support them. Mr Broadbent commented that research was an investment-type activity - the returns to policy took time to come through – and that, as such, naturally came under pressure when there were a number of competing demands on staff resource - Mr Haldane agreed. Directors welcomed the draft Review but suggested the IEO sharpen the recommendations: how much should the budget be and where should it sit? What were the choices and the costs? The final report would be tabled at Court in October and published once approved.
25 October 2019
(c) The Chair
Ms Thompson said that the Nominations Committee had noted that Mr Fried’s appointment as Chair of Court would extend his period on Court one year beyond the nine years recommended as a limit by the FRC Code. Court agreed that this was justified by the need for experience on Court.
Budget and Costs – Forecast and Framework
Court considered proposals from Ms Kyei on the budget framework for 2020/21. This would allow spending to grow by no more than the rate of inflation; and for the subsequent three years a multi-year budget would be set. A separate ring-fenced budget would be proposed to cover restructuring expenditure. The Governor commented that the Bank’s cost base… …And some prioritisation options would cost money to implement.
Deputy Governors added that the work of the past two years had sharpened the concept of scarcity and the need for prioritisation. It had been hard but worthwhile. Mr Broadbent supported the change and the opportunity to revisit the investment spending envelope: he thought that the level of investment spend may have dipped too far. Mr Woods said that he supported the change in the framework. The Bank had shown restraint over the previous two years, and that had forced a reassessment of priorities. The new approach was wise, as otherwise the Bank would cut further into live operations: he supported the distinction between run and change. Sir Dave Ramsden was also supportive of the changes, but felt that the long established divisional framework could make it harder to work across boundaries.
Diversity and Inclusion
(a) BAME Taskforce Update
(Jonathan Curtiss, Paul Wright, Cat Hines and Ratidzo Starkey)
…Progress would require formal and informal sponsorship, and visible support at all levels. Mr Woods thought it would be useful to engage more directly with middle management on this issue. Directors encouraged the Bank to look hard at performance management data which could reveal unconscious bias; to make fuller use of data (“what gets measured gets done”); and to introduce reverse mentoring (Ms Starkey said the network had introduced such a scheme).
Brexit and Risk Update
(Phil Evans, Laura Wallis, Stephen Brown, Nat Benjamin, Grellan McGrath and Daniel Konopka)
Mr Evans outlined the continuing work of the withdrawal unit. The Bank was prepared for all possible outcomes, including No Deal. Daily liquidity reporting was in place along with supervisory calls to banks and insurers, and the frequency of high level contingency meetings had increased.
2 December 2019
The Governor said that he saw the role – and the preparation for UK-hosted COP26 summit in Glasgow – as an opportunity to make a material difference in integrating climate change into financial decision-making, by banks, insurers and asset managers. For the Bank, alongside the existing climate hub, there was likely to be a small government-funded team to prepare for COP26.
Financial Review October 2019/20 Year To Date and Budget Update 2020/21
(Afua Kyei and Rob Thompson)
Ms Kyei outlined the latest full-year forecast for 2019/20: total spending remained close to £643mn, £3mn over budget; and the flat nominal spend was expected to be £473mn, £1mn over budget: risks to the forecast were low. The Governors had agreed that the allocation for staff performance awards should remain in line with last year at 10%, in recognition of staff contribution over a challenging period. For the following year, it had been decided to set performance awards after the point at which the cost outturn against budget was certain.
Following the discussion in October, a “flat real” budget would be proposed for 2020/21, with a separate provision for investment. That would pave the way for possible multi-year budgeting in the years ahead. The Governors had approved a deprioritisation package and an extension of the current external recruitment pause through May 2020. The final budget for 2020/21 would be presented to Court for approval in February.