Key economic adviser, known for helping keep UK out of euro, replaces Charlotte Hogg and will have seat on MPC
Philip Hammond has filled the vacancy on the Bank of England’s interest rate setting committee left by the departure of Charlotte Hogg, following the appointment of Sir David Ramsden as the central bank’s new deputy governor.
The chancellor said Sir David, who is the Treasury’s chief economic adviser, would take up the role as deputy governor of markets and banking, making him Threadneedle Street’s eyes and ears on the banking sector while also giving him a position on the nine-strong monetary policy committee (MPC).
City analysts said they expected Sir David, who advised Hammond and former chancellor George Osborne on the government’s austerity programme, to vote with the bank’s governor Mark Carney and the majority of the MPC to hold interest rates when he takes up his post on 4 September.
With the appointment, Hammond has filled the last MPC vacancy after Hogg quit and external member Kristin Forbes left following a three-year term, although he has failed in his mission to improve the committee’s gender balance.
The former London School of Economics professor Silvana Tenreyro will be the only woman on the MPC when it votes next week.
Known for his role in keeping the UK out of the euro, Sir David is a life-long civil servant who has risen through the ranks of the Treasury to be its most senior economist and head of the government’s economic service, which effectively puts him in charge of economic advisers across Whitehall.
In the late 1990s, Labour chancellor Gordon Brown put Sir David in charge of evaluating Britain’s readiness to join the euro. Eighteen reports later, he and his team condensed their efforts into one assessment of five tests that Brown said needed to be met before the UK could join.
Sir David persuaded Tony Blair in 2003 that joining the euro would prove disastrous.
Carney is expected to appreciate Sir David’s reputation for loyalty. A keen cyclist, he is known to value a range of opinions and has spoken in favour of a more pluralist approach to the way universities teach economics.
However, it was his department that produced the economic forecasts that paved the way for Osborne’s austerity programme which critics argue has left the economy in a weaker situation almost a decade after the 2008 financial crash.
Carney said: “As an outstanding public servant, he will bring a wealth of experience and economic expertise to the Bank’s policy committees.”
Sir David replaces Hogg, the scion of the Hogg political dynasty and BoE official who resigned earlier this year after she failed to disclose that her brother was a senior executive at Barclays – a bank she would have regulated.
Hogg was also chief operating officer. That job has gone to Joanna Place, who was previously the central bank’s human resources director.
Sir David has a long list of responsibilities in his new role, the Treasury said, including managing the government’s foreign exchange reserves and the gathering of market intelligence relevant to policy decisions.
Sir Dave, as he is known, will also be a member of the financial policy committee, the prudential regulation committee and the court of the Bank of England.