Andy Haldane (Opinion, January 12) is right to call for reform of the UK Treasury. Institutional change — across both Treasury and the Bank of England — is long overdue and would be a necessary change for improving the UK’s long-term growth. I have argued for this for some time.
Treasury reluctance in 2012, and more recently in the pandemic, to embrace locking-in borrowing at very low long-term rates to finance infrastructure is just one of many recent examples of its inability to prioritise growth.
These issues are not new. In the 1930s, John Maynard Keynes criticised the “Treasury view” that opposed public investment. In 1964, Harold Wilson argued that the Treasury was too powerful, creating the Department of Economic Affairs. However, under Gordon Brown and Tony Blair, the Treasury’s remit expanded, creating a ministry even more powerful.
While there is a vital need to ensure the nation’s budget arithmetic adds up, a new approach is required given the UK’s disappointing growth record, the need to reduce inequality, and achieve net zero.
The BoE, meanwhile, where change is equally necessary, lacks diversity of thought, has a class issue, and its court and policy committees should have greater regional representation.
There is a strong argument in favour of a revamp across Whitehall with respect to economic policy.
Gerard Lyons
Crockham Hill, Kent, UK
