Protecting the new governor's lifestyle

 
Mark Carney Mark Carney will take up his new post in July.

The Treasury offered Mark Carney a £250,000 annual accommodation allowance, on top of his £624,000 salary and cash in lieu of pension, because it did not see why his lifestyle should suffer from a move to London.

Currently governor of the Bank of Canada, Mr Carney, his English wife and four children live in a large family house a short distance from his office in Ottawa.

Apparently an equivalent home in London would cost around £2600 per week, which is the value of his new allowance after tax and national insurance.

Even so, even in the private sector, it is unusual to receive a housing subsidy on that scale.

And what may stir controversy is that Mr Carney's package protects him from the kind of gyrations in the economy that it will be his role to temper.

What is more, Mr Carney will be the first governor of the Bank of England not only to have the power to set interest rates but also to directly influence the supply of credit through the newly created Financial Policy Committee.

How would it play with people and media if he announces significant restrictions on the availability of mortgages in a housing boom, for example, when he would be wholly insulated from such tough policy announcements?

Little wonder that the non-executives on the court of the Bank of England have taken a couple of weeks to ratify the chunky housing payment which was offered to Mr Carney by the Treasury.

 
Robert Peston, economics editor Article written by Robert Peston Robert Peston Economics editor

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  • rate this
    +1

    Comment number 24.

    So the new Governor of the Bank of England can only afford a tied cottage. This says more about the madness of UK housing policies than anything else.

    I fail to see why anyone's standard of living should suffer......

  • rate this
    0

    Comment number 23.

    Considering we are paying for some bearded chap who hates this country, us and everything we stand for, to live in the comfort of a £450,000 detached house in North London I think any housing costs bequeathed to Mr Carney, who wants to help rebuild our broken economy utilizing his expertise, should, in comparison, be welcomed...It's a wonderful world, even if it does seem a little crazy at times!

  • rate this
    +2

    Comment number 22.

    All this on the same day that Eric Pickles cuts local authority funding, yet again.

    The biggest lie ever told was "we are all in this together".

  • rate this
    +2

    Comment number 21.

    wow all those people born and bred in london who are being forced out of areas where they have grown up and have family ties and yet we have even more rich individuals like the cabinet and the royals and now this man getting grace and favour accommodation will his utilities be paid for more than likely will his children have state funded private schooling more than likely were all in this together

  • rate this
    +2

    Comment number 20.

    Not only will we have to pay for his mistakes...

    we also get to pay for his housing?!?

  • rate this
    -1

    Comment number 19.

    It isn't a very high package for a senior person, and housing allowances are common for those brought from abroad within an organisation, so I cannot see anything very exceptional about this. Frankly, I would probably want a similar allowance to leave rural Hampshire and move to the muticultural cesspit that London has become.

  • rate this
    +1

    Comment number 18.

    If the BoE is hiring Carney all the way from Canada and paying such high price for his skills which, I assume, are unmatched by anyone else in the UK, then the pay should be performance related. He can only justify commanding any ludicrous salary and bonus if he delivers what he is being paid for. But if that is set out, perhaps it will the BoE's turn to justify hiring Carney in the first place.

  • rate this
    +2

    Comment number 17.

    Let us hope that Mark Carney's personal allowances prompt him into an understanding of the diabolically overpriced UK housing market - AND HE DOES SOMETHING ABOUT IT!

    The one thing he can't say is that he is ignorant of it!

    Rates Up, Mark, deflate the debt/housing bubble so capitalism can restart in the UK, or you will have failed before you have started.

    You work for the country NOT THE BANKS!

  • rate this
    0

    Comment number 16.

    While the indigenous population that can afford a mortgage but at the expense of moving further away from their workplace with all of the added costs of transportation or those that can not obtain a mortgage but have to pay rents dearer than a mortgage we get this social security scrounger that tops the lot. Oh I forgot we're not all in this together - sorry.

  • rate this
    0

    Comment number 15.

    Why wasnt this announced at the same time as his salary were they embarrassed ?

    How many others get this allowance ?

    "because it did not see why his lifestyle should suffer " and here i agree with them ,
    however
    it would be nice if they applied that same mantra to their policies which are making the 99% suffer to pay for the excesses of a few !!!!

  • rate this
    -1

    Comment number 14.

    He's by common consensus the best person in the world for by far the most important economic job in the UK. It's a tiny fraction of what he'd make in the private sector (Hector Sants is to get up to £3M pa to be Head of Compliance at Barclays) and perfectly reasonable.

    And it is quite essential that he should be completely impartial in his decisions, so he should not be personally hit by them.

  • rate this
    +2

    Comment number 13.

    Tucked away in all this is a confession to the value of Mervyn Kings pension fund. I discussed it here on Mark Carney's appointment.

    "Applying the same mathematics and methodology to Mervyn King’s pension brings me to a value of £7.68 million! "

    http://www.mindfulmoney.co.uk/wp/shaun-richards/what-will-mark-carney-bring-to-the-bank-of-england/

    All in it together?

  • rate this
    +3

    Comment number 12.

    So the new guv'ner is getting a housing allowance then?
    This sounds somewhat familiar will the next concession be a council tax subsidy followed by payment of utility bills food & a trolley dash once a week through John Lewis perhaps? Well why not that way he can trouser all the pay & bonus. Luvvly Jubbly! Like MP's
    When do the rest of us plebs get the same concessions from our employers though?

  • rate this
    +2

    Comment number 11.

    It is interesting how we have so many 'experts' now on what needs to be done to resolve the banking issues (post the calamitous events that led to the crash). One must ask where these experts were beforehand to review Libor, subprime mortgages etc.. I would hire the people who were raising the issues beforehand to the overwhelming banks silence, not those involved during it.

  • rate this
    +12

    Comment number 10.

    “lifestyle should suffer from a move to London”

    Tell this to all the people born in London that can’t afford to live there anymore due to a property bubble!

  • rate this
    +4

    Comment number 9.

    Does the BofE have even the foggiest idea what financial hardship the other 99.9% of the UK population have to live with. Fuel poverty, negative equity, payday loans, state pensions etc etc... At what point do the general public say enough is enough. Social unrest here we come....

  • rate this
    +1

    Comment number 8.

    Not surprised. Something had to be in there to lure him out of the Bank of Canada, and his "spacious" house.

  • rate this
    +2

    Comment number 7.

    Not 'amooseing' at all, if your a homeless or jobless Brit.

  • rate this
    +3

    Comment number 6.

    In light of the facts and numbers "We're all in it together" is wearing a bit thin....

  • rate this
    +2

    Comment number 5.

    Ah a precedent is set we can all now ask our employers to fund our housing on top of our existing wages. What a brick (I think that's what my gran used to say) and just in time for Christmas. Looks like we are all getting that Prosperous New Year after all.

 

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