Osborne ready to overhaul Bank of England governance

The Chancellor has indicated that he is ready to overhaul governance of the Bank of England ahead of it gaining more powers over financial regulation.

Answering questions in Parliament, George Osborne said the Treasury was considering seriously recommendations made by the Treasury Select Committee on how to update the bank's "antiquated" processes.

The committee has called for the Bank's governing court to include more external members and to act more like a board of directors in holding the Governor, Sir Mervyn King, to account. It said the Bank should release more information to Parliament to open decisions to more public scrutiny.

Asked if the Bank's court was "fit for purpose", Mr Osborne said the Treasury Committee had "posed a very good question" about whether the court should be beefed up with a greater oversight role. He added that he was also considering the committee's request for more powers to scrutinise the Bank. Mr Osborne told a joint Parliamentary committee on the draft Financial Services Bill that he planned to publish his response to the Independent Commission on Banking's proposals for financial reform by mid-December.