Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what recent discussions he has had with the Bank of England on steps to help tackle rising inflation rates.

The Chancellor and Governor of the Bank of England regularly meet to discuss a wide range issues affecting the economy. However, it is the responsibility of the Bank of England’s Monetary Policy Committee (MPC) to maintain price stability through its use of monetary policy. The MPC has been successful in doing so, with inflation averaging close to target since the Bank’s independence. The separation of fiscal and monetary policy is a key feature of the UK’s economic framework, and essential for the effective delivery of the MPC’s objectives, so the Government does not comment on the conduct of monetary policy.

Although inflation is a shared global problem that is not unique to the UK, the Government is taking action to ease cost of living pressures where it can. As part of the Autumn Budget and Spending Review the Chancellor announced a package of measures to help with cost of living pressures, including reducing the taper rate in Universal Credit from 63% to 55%, and increasing the National Living Wage by 6.6% to £9.50 an hour in April 2022. Alongside the Budget and Spending Review the Chancellor also wrote to the Governor of the Bank of England to reaffirm their remit to achieve low and stable inflation, confirming the Government’s commitment to price stability was absolute.