Ex-mandarin with ‘no economic experience’ lined up for Bank of England role

·3 min read
The Bank of England - Maja Smiejkowska/Reuters
The Bank of England - Maja Smiejkowska/Reuters

A former mandarin with “no economic experience” is on course to be appointed to the Bank of England’s board after civil servants told the Chancellor she would “make a strong contribution to improving diversity and inclusion”.

Dame Clare Moriarty, a former permanent secretary of the environment department, has been selected by Nadhim Zahawi, having been lined up by the Treasury during Rishi Sunak’s time as chancellor.

But a government source criticised the decision to put her forward for the role amid the growing cost of living crisis and pressure over the Bank’s handling of inflation.

On Friday, Kwasi Kwarteng, the Business Secretary, warned that “something has gone wrong” at Threadneedle Street and, writing for The Telegraph, Liz Truss said the spike in inflation was “exacerbated by monetary policy”.

The government source said: “Appointing a woke ex-mandarin with no economic experience and whose first priority is diversity and inclusion to a pivotal post at the Bank of England would be reckless in the best of times.

“Any Conservative chancellor who believes this appointment would strengthen the Bank’s response to rampant inflation is asking for their own P45.”

The Telegraph understands Mr Zahawi’s formal recommendation of Dame Clare, now the chief executive of Citizens Advice, states that the recruitment panel “thought she would make a strong contribution to improving diversity and inclusion at the Bank, given her insightful answers on how she would drive this forward”.

The recruitment panel was chaired by Sir Tom Scholar, the Treasury’s permanent secretary, and also comprised Charles Roxburgh, his deputy, together with Baroness Harding, a Tory peer and existing non-executive director at the Bank, and Terry Miller, a senior figure at Goldman Sachs.

Mr Sunak has been accused of being “captured” by the advice of officials, including Sir Tom, during his time at the Treasury.

Mr Zahawi’s formal recommendation has been submitted by the Treasury to Number 10. A source said it had not yet been formally put to Boris Johnson.

The document, which states that vetting of Dame Clare was carried out by officials and former Treasury special advisers, adds: “It was questioned whether she had sufficient previous experience in non-executive roles, having mostly been posted as an executive.

“However, overall, the panel thought she was a strong candidate due to her excellent interpersonal skills, ability to engender trust in staff, peers and stakeholders, and her passion for operational change.”

A source close to Mr Sunak denied that any of his special advisers carried out due diligence checks on Dame Clare.

Dame Clare is said to have carried out a review of the Bank’s “central services”, including its human resources and technology divisions, last year, when she “demonstrated her ability to work effectively” with senior figures.

She describes herself in her Twitter profile as “agitating for diversity, inclusion and change.” She worked in the Civil Service from her graduation from Oxford University in 1985 until last year.

A Treasury source said: “We fully expect anyone appointed to be focusing on the things that really matter given the current national economic emergency.” The source insisted the appointment had not been finalised.