Question to the HM Treasury:

To ask Her Majesty’s Government whether they have ruled out cancelling the gilt-edged securities bought by the Bank of England under the quantitative easing policy.

The independent Monetary Policy Committee (MPC) of the Bank of England has operational independence for monetary policy. The MPC makes decisions on its policy tools, including quantitative easing (QE), in order to meet the 2% inflation target in the medium term.

The separation of fiscal and monetary policy is a key feature of the UK’s economic policy framework. To use monetary policy tools to meet fiscal objectives, such as financing government borrowing, could conflict with the MPC’s objective of price stability and undermine confidence in the monetary policy framework. Additionally, Government borrowing from the central bank is illegal under Article 123 of the Treaty on the Functioning of the European Union.