Bank of England changes expenses policy after anger at ‘staggering’ costs
The Bank of England is to reduce the amount its top officials can claim on expenses after two bigwigs came under fire for running up a near £400,000 bill for travel and flights.
Donald Kohn and Anil Kashyap, members of the Bank’s Financial Policy Committee, came in for sharp criticism from MPs earlier this year when it emerged that they spent £390,000 on travel expenses, including more than £11,000 on one flight.
On Friday, the Bank said it is placing a cap on the costs for hotels in certain locations and reducing the daily meal allowance from £50 to £40.
The changes, part of an updated expenses policy, mean that the number of senior workers who must release expenses is to increase and will include executive directors and non-executive Court members.
Publishing the policy for the first time, the Bank said it will seek to ensure “value for money” and take into account the environmental impact of travel decisions.
In addition, the level of detail of expenses will increase.
Nicky Morgan MP, chairwoman of the Treasury Committee, said: “Given the staggeringly high level of expenses claimed by some members of the Bank of England’s policy committees, the review of its expenses policy is welcome.
“The Bank must now ensure that the new rules are followed in both letter and spirit by all staff across the organisation.
“The Treasury Committee will examine the Bank’s expenses, as well as the review itself, in detail when we take evidence from the Court of the Bank of England in the New Year.”
Last month, figures released by the Bank showed that Mr Kohn, who is based in the US, spent nearly £31,000 on travel including three return flights from Washington to London in the quarter.
They also show that Governor Mark Carney racked up more than £50,000 in expenses between March and May, resulting from £49,876 on foreign business travel and a further £781 on car hire and taxis.
The Canadian has defended the Bank’s spending, claiming in June the foreign travel expenses were justified.
He said at the time the Bank is the “world’s leading international financial centre and the most complex in the world”.
Mr Carney said the Bank was at the “top table” of key global meetings and added “we can’t have all of them meet in London”.