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 Article written by Robert Peston Robert Peston Economics editor

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  • rate this

    Comment number 84.

    Yet again MP's just make the rest of us look stupid............stupid because we're not a part of this cosy club.

  • rate this

    Comment number 83.

    prudeboy @ 77:

    I can see, like me, you're an engineer.

    So you should be used to basing judgement on facts - not opinions.

  • rate this

    Comment number 82.

    79. Trans-atlantic rather than transparent?

    Does anyone actually know who Carney's employer will be - after all the talk about the 'BOE' - His 'contract' will be sorted out in Whitehall and under HM Treasury letterhead correspondence (or a mega expensive head-hunter)?
    So Carney will be a 'free-lancer' as sorting out his own tax as a Canadian ex-pat?
    Nice 'tax dodge' for starters

  • Comment number 81.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • rate this

    Comment number 80.

    So how does one get into this club of crooks that are paid silly salaries by governments?

    Oh, I forgot. You have to go and work for Goldman Sachs first, and swear your allegiance to their interests. And we all know what those are.

  • rate this

    Comment number 79.

    At least it’s open and transparent unlike MP’s expenses claimed for a London home. Can’t really see what the problem is.

  • rate this

    Comment number 78.

    It is a lot of money - but Labour govt would probably have paid someone more & who is a poor fraction as well qualified as Carney but will make no difference if Carney does not shake things up & get beyond the London-centric/foreignising focus that has held back the UK for 50 + years.
    Carney also looks good vfm compared to seniors at other banks & quangos like the BBC - so - 'let him have a go' ?

  • rate this

    Comment number 77.

    #71. WhyMe44

    "As with SRB please avoid ranting and spitting out meaningless
    unsubstantiated statements."

    Do it all day. It's my job see. I have to make things that work. In the real world. Not just try to persuade folk that this is the way of the world.
    Document them. With instruments calibrated to NPL traceability standards.

    I know exactly, exactly, when somebody is taking the

  • rate this

    Comment number 76.

    CEOs of big businesses (and which is bigger?) who are not also founders tend not to make any important decisions: they are figureheads and spokespersons. If a particular person is wanted, it is because they are of immense political benefit. So, in what way is Carney well aligned with the aims of the Conservative Party? That is the only relevant question.

  • rate this

    Comment number 75.

    This is about as controversial as boiled potatoes.

  • rate this

    Comment number 74.

    I am sure he could earn more in the private sector, he should get used to the british national hobby of moaning.

  • rate this

    Comment number 73.

    "cash in lieu of pension"

    Is he that pessimistic about the long-term financial fortunes of the UK? And he's not even started the job yet....

  • rate this

    Comment number 72.

    #27 truley dreadful that no one fromthe UK can or is fit enough for the job.

    another overpriced banker

    along with overpriced footballers and other celebs

    maybe some realignment is required

  • rate this

    Comment number 71.

    prudeboy @ 67:

    As with SRB please avoid ranting and spitting out meaningless unsubstantiated statements.

  • rate this

    Comment number 70.

    For an even bigger raise, he could run a British sports club....

  • rate this

    Comment number 69.

    I don,t know whether he'll be better or worse than any other choice but it was the govt. wanted him. Why would he take a drop in money etc for a job he wan't so keen on?

    Anybody on this forum going to take a tougher job for less money?

  • rate this

    Comment number 68.

    @64 WhyMe44

    Taken seriously by whom?

    Your words are very kind, but your approval is not, as far as I understand it, a condition of using this blog.

  • rate this

    Comment number 67.

    How will Peston or some other hapless underpaid hack manage to keep his face straight when he gets to interview this fellow?

    Sitting down opposite him he will be truly in awe.
    Just think: Sitting down with an emperor and knowing he hasn't got any clothes on. What a hoot.

    So remember Robert: No coughing, smirking or halted conversation.

    Treat him as you would any other public employee.


  • rate this

    Comment number 66.

    I think you and some bloggers miss the point.

    Just as with a major UK bank, what is the value to the taxpayer of an effective chief executive compared to a less effective one? So if we chose a 'cheaper', home bred governor could it end up costing us more? This is the man who amongst other things will regulate the banks. I don't mind paying somebody to that effectively.

  • rate this

    Comment number 65.

    so while the rest of us are being raked over the coals with austerity, inflation and quantitative easing, to prop up banks and people like this, this Mark Carney is being given almost a million pounds, "because it did not see why his lifestyle should suffer from a move to London."

    No words to describe how I feel about this. except hate. pure hate.


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