Reform UK tells Reeves to grab 20bn lifeline From Bank of England and scrap tax hikes

"Reform UK has urged Chancellor Rachel Reeves to seize a £20bn "lifeline" from the Bank of England by overhauling its money-printing programme, in a move the party says could plug much of Britain's looming budget black hole. Richard Tice, Reform's deputy leader, revealed he had pressed the case directly with Bank of England governor Andrew Bailey during a meeting this week, describing the encounter as "very civil, polite and courteous". Party leader Nigel Farage also attended."

"Reform argues that halting bond sales and paying less interest on the money created through QE would save the Treasury around £20bn each year. Tice said the Bank's approach was "pushing up borrowing costs" and unfairly leaving taxpayers to shoulder the burden. "If politicians gave the Bank a different steer, they could do it tomorrow," Tice claimed."

Reform UK proposes that changing the Bank of England's quantitative easing implementation could free up about £20bn a year for the Treasury by halting bond sales and reducing interest paid on money created during QE. The Bank previously created £895bn in QE and returned £125bn in profits, but rising interest rates and falling bond values have produced large losses since 2022. Reform representatives met the Bank governor to press the case. Economists and think tanks have warned that the existing arrangements linking Treasury exposure to Bank losses complicate fiscal policy and increase pressure on the upcoming Budget.

Read at Business Matters