OPINION: Bank of England is not a superpower

Central bankers complain when they are feeling stressed that no one other than a central banker understands their job.

Anthony Hilton
Anthony Hilton

No one else sits at the centre of their financial web. No one else has such unimpeded access to information. No other organisation is held in such awe but with so much expected of it.

The public and political perception is that whatever crisis comes along the Bank of England will sort it out. But in fact its people are only human, prone to the same inefficiencies, oversights, jealousies and misjudgements as anyone else.

The central bank, therefore, has a huge job in expectation management because the public perception of its abilities runs way ahead of what it can deliver. Hence the disappointment when problems such as Northern Rock are fumbled.

Its challenge is to explain that while it may have more knowledge than anyone else, it is still imperfect; while it may have more power than anyone else it still may not be enough; while it may have more moral authority, it is nevertheless open to legal challenge. At the same time it has to bear in mind the danger of being too open - the danger, as someone once said in the context of the royal family, of shedding light on magic.

It doesn't want to destroy all of the mystique because that remains a major source of its power and authority.

It follows that it cannot really pick up the phone and behave like a ministerial press aide. Although the Bank of England has a PR team, run by a former Sunday Times business journalist, the need for discretion inhibits its ability to be proactive.

Interestingly, the best PR the Bank has had recently came in the form of the now retired Alastair Clark, who was unofficially known as the Governor's eyes and ears. The point about Clark was that he was at all the lunches, receptions and lectures - you always bumped into him. It was like seeing a policeman on the beat. He might never catch a criminal, but his very presence persuaded the City that the Governor was in touch, knew what was happening and was on top of the job.

It is sad but not surprising that Clark's departure has coincided with an unprecedented level of anti-Bank criticism.

Anthony Hilton is City commentator on London's Evening Standard

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