Bank of England criticised by MP over 'staggering' £390,000 expenses bill for two policymakers

BoE spent money on travel for US-based policymakers Anil Kashyap and Donald Kohn over two-and-a-half years

One return flight from Chicago to London for a meeting in February this year cost the BoE £11,084.89 (Reuters)

The Bank of England has paid out “staggering” sums on expenses to two members of its Financial Policy Committee (FPC), an MP on a top Commons committee said on Tuesday.

US-based policymakers Anil Kashyap and Donald Kohn had between them accumulated £390,000 in travel expenses over two-and-a-half years, said Simon Clarke, a Conservative MP on the Treasury Committee. Mr Clarke said this echoed the 2009 MPs' expenses scandal.

Mr Kashyap and Mr Kohn are external members of the FPC, which monitors the stability of Britain’s financial system.

“One of the most important aspects of the culture of any public institution is that it provides value for money to the taxpayer,” Mr Clarke said.

“Mr Kohn and Mr Kashyap have incurred £390,000 in travel expenses, which is a simply staggering sum. Do you think that’s a sensible use of the Bank’s resources,” he asked the new chair of the BoE’s court of directors, Bradley Fried.

“I can certainly say that my constituents would be gobsmacked to hear that Mr Kashyap for example [had] one return flight from Chicago to London for a meeting in February this year [that] cost £11,084.89,” Mr Clarke said.

Mr Fried said the contributions of Kohn and Kashyap to the FPC had been “tremendous”.

“I can’t quite work out a formulaic assessment of value for money against their participation versus the travel expenses, but I hear exactly what you say,” Fried said, adding that the BoE would dwell on this.

BoE records show Mr Kohn, a former vice chairman of the US Federal Reserve, has claimed £274,568 in expenses between December 2015 and February 2018.

Kashyap, a professor of economics and finance at the University of Chicago Booth School of Business, has claimed £116,742 between October 2016 and February 2018.

The pair are external members of the FPC, brought in for their experience outside the BoE.

The expenses of external FPC members who are based in Britain are miniscule by comparison.

The records show business executive Martin Taylor has claimed £733.96 in expenses since December 2015, while investment banker Richard Sharp has yet to claim any expenses over the same period.

Reuters