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MPs grill Bank of England over deputy governor's code of conduct breach - business live MPs grill Bank of England over deputy governor's code of conduct breach - business live
(35 minutes later)
1.28pm GMT
13:28
Labour MP: Charlotte Hogg must resign
Newsflash: John Mann MP has declare that Charlotte Hogg’s position as deputy governor is “now untenable”, following her admission that she didn’t declare that her brother hold a senior role in Barclays’ strategy team.
In a statement just released, Mann MP argues that Hogg has failed to meet the principles of public life, known as the “Nolan principles” (a point he made during today’s hearing).
Mann says:
“It is simply incredible that such a senior person at the Bank of England has behaved in such in this manner. Last week Charlotte Hogg proudly told this committee that she actually wrote the bank’s code of conduct which she has now admitted to repeatedly breaking it.”
“Not only has she compromised her current position and the Bank of England itself but more importantly she has failed under the key principles of the Nolan standards in public life and she has no excuse for doing so.”
“This is simply a question about standards in public life and in this regard she has failed and must resign.”
1.21pm GMT
13:21
You can watch the entire Treasury Committee hearing about Charlotte Hogg’s non-declaration here.
1.20pm GMT
13:20
Andrew Tyrie wraps up the hearing by saying that we are “looking at a mistake, a series of mistakes”.
We need to examine if the response from the bank has been proportionate.
There are three issues to discuss, Tyrie argues:
Tyrie concludes by telling Anthony Habgood and Bradley Fried that this morning’s news about Charlotte Hogg has been a surprise to a number of committee members, including himself, and they must “think very carefully” about it.
1.14pm GMT1.14pm GMT
13:1413:14
Charlotte Hogg has also officially recorded her family links to the Hoare family -- who created Britain’s oldest private bank, Habgood says.Charlotte Hogg has also officially recorded her family links to the Hoare family -- who created Britain’s oldest private bank, Habgood says.
1.09pm GMT1.09pm GMT
13:0913:09
Q: Have any other senior Bank of England staff updated their declarations under the code of conduct since Charlotte Hogg’s omission came to light?Q: Have any other senior Bank of England staff updated their declarations under the code of conduct since Charlotte Hogg’s omission came to light?
Anthony Habgood says that several people have, yes, including one who has added that his daughter is a political journalist.Anthony Habgood says that several people have, yes, including one who has added that his daughter is a political journalist.
1.01pm GMT1.01pm GMT
13:0113:01
BoE deputy chair: Hogg is a “superb public servant”BoE deputy chair: Hogg is a “superb public servant”
Deputy court chairman Bradley Fried now hits back at the suggestion that Charlotte Hogg’s conduct has fallen below acceptable standards.Deputy court chairman Bradley Fried now hits back at the suggestion that Charlotte Hogg’s conduct has fallen below acceptable standards.
Despite this lack of disclosure over her brother, I believe she is a “superb public servant” says Fried.Despite this lack of disclosure over her brother, I believe she is a “superb public servant” says Fried.
His personal view is that Hogg does meet standards of the best of public life laid out in the code.His personal view is that Hogg does meet standards of the best of public life laid out in the code.
We are living with the “disappointment and aggravation” of her non-disclosure right now, Fried adds.We are living with the “disappointment and aggravation” of her non-disclosure right now, Fried adds.
And he suggests this affair will be a “watershed moment” in Hogg’s career, and also in the way that senior Bank executives report any potential conflicts of interest.And he suggests this affair will be a “watershed moment” in Hogg’s career, and also in the way that senior Bank executives report any potential conflicts of interest.
UpdatedUpdated
at 1.04pm GMTat 1.04pm GMT
12.47pm GMT12.47pm GMT
12:4712:47
Scottish Nationalist Party MP George Kerevan reads out the Bank’s code of conduct.Scottish Nationalist Party MP George Kerevan reads out the Bank’s code of conduct.
Q: The code of conduct on interests says that “living within our code is not simply about observing the letter of the policies referred to. We aspire to set an example of the best in public service.”Q: The code of conduct on interests says that “living within our code is not simply about observing the letter of the policies referred to. We aspire to set an example of the best in public service.”
By that test, has Ms Hogg failed it?By that test, has Ms Hogg failed it?
BoE Court chairman Anthony Habgood replies thatBoE Court chairman Anthony Habgood replies that
She has omitted something that she should not have omitted, that is important, so she has not lived up to that code.She has omitted something that she should not have omitted, that is important, so she has not lived up to that code.
Q: So do you stand by the code?Q: So do you stand by the code?
Absolutely we stand by the code, Habgood adds.Absolutely we stand by the code, Habgood adds.
Q: What effect will her non-compliance have on the rest of the bank staff, and the way they see the code?Q: What effect will her non-compliance have on the rest of the bank staff, and the way they see the code?
We will push the code harder, Habgood says, but it is hard as it relies on self-assessment. For example, someone’s second son might move from a non-regulated City firm to a regulated one - so they’d need to update their records.We will push the code harder, Habgood says, but it is hard as it relies on self-assessment. For example, someone’s second son might move from a non-regulated City firm to a regulated one - so they’d need to update their records.
We have moved a long way from a few years ago, when the Bank didn’t really have a code of conduct, Habgood adds (somewhat alarmingly!)We have moved a long way from a few years ago, when the Bank didn’t really have a code of conduct, Habgood adds (somewhat alarmingly!)
12.38pm GMT12.38pm GMT
12:3812:38
Tory MP Kit Malthouse is concerned that the Bank of England doesn’t know exactly what Quintin Hogg does at Barclays.Tory MP Kit Malthouse is concerned that the Bank of England doesn’t know exactly what Quintin Hogg does at Barclays.
He could even be targeted with handling Barclay’s strategy towards the Bank of England, Malthouse suggests.He could even be targeted with handling Barclay’s strategy towards the Bank of England, Malthouse suggests.
We could find out, Habgood concedes. But even if that were the case, he thinks it wouldn’t have affected Charlotte Hogg’s suitability to be deputy governor.We could find out, Habgood concedes. But even if that were the case, he thinks it wouldn’t have affected Charlotte Hogg’s suitability to be deputy governor.
12.36pm GMT12.36pm GMT
12:3612:36
Now the committee ask about social ties between the top brass at the Bank of England.Now the committee ask about social ties between the top brass at the Bank of England.
Court chairman Anthony Habgood insists that he’s had no social interaction with Charlotte Hogg -- beyond one trip to “something to do with ballet for youthful people”.Court chairman Anthony Habgood insists that he’s had no social interaction with Charlotte Hogg -- beyond one trip to “something to do with ballet for youthful people”.
I didn’t know her until just before I came to the bank.I didn’t know her until just before I came to the bank.
But Habgood then reveals other ties to the Hogg dynasty.But Habgood then reveals other ties to the Hogg dynasty.
I know her mother better than I know her because she’s been chairman of various things when I’ve been chairman of various things.I know her mother better than I know her because she’s been chairman of various things when I’ve been chairman of various things.
Charlotte Hogg’s mother is Sarah Hogg, the first woman to chair a FTSE 100 company (3i, back in 2002). She’s married to Douglas Martin Hogg, son of the late Lord Hailsham, and a former Tory MP (until his expenses claim for moat-cleaning came to light...)Charlotte Hogg’s mother is Sarah Hogg, the first woman to chair a FTSE 100 company (3i, back in 2002). She’s married to Douglas Martin Hogg, son of the late Lord Hailsham, and a former Tory MP (until his expenses claim for moat-cleaning came to light...)
UpdatedUpdated
at 12.59pm GMTat 12.59pm GMT
12.27pm GMT12.27pm GMT
12:2712:27
Fried adds:Fried adds:
Anthony [Habgood]and I are fans of Charlotte. We think she’s a distinctive professional.Anthony [Habgood]and I are fans of Charlotte. We think she’s a distinctive professional.
12.25pm GMT12.25pm GMT
12:2512:25
Conservative MP Kit Malthouse wants to know what the Court of the Bank of England (the board of the central bank) is going to do about Hogg’s breach of the code.Conservative MP Kit Malthouse wants to know what the Court of the Bank of England (the board of the central bank) is going to do about Hogg’s breach of the code.
Deputy chairman Bradley Fried says the situation will be discussed.Deputy chairman Bradley Fried says the situation will be discussed.
Clearly we have an issue now around optics. We hope that it can be resolved.Clearly we have an issue now around optics. We hope that it can be resolved.
It’s not an issue how we feel individually. We will discuss it in full Court.It’s not an issue how we feel individually. We will discuss it in full Court.
Chairman Anthony Habgood then weighs in, saying they don’t expect to recommend reversing Hogg’s appointment as deputy governor of the BoE.Chairman Anthony Habgood then weighs in, saying they don’t expect to recommend reversing Hogg’s appointment as deputy governor of the BoE.
Why not, asks Tyrie?Why not, asks Tyrie?
Because the process of having Hogg’s line manager (Mark Carney), and the head of HR looking into the issue has been concluded, Habgood explains.Because the process of having Hogg’s line manager (Mark Carney), and the head of HR looking into the issue has been concluded, Habgood explains.
UpdatedUpdated
at 12.26pm GMTat 12.26pm GMT
12.19pm GMT12.19pm GMT
12:1912:19
Earlier in this hearing, deputy court chairman Bradley Fried said Hogg had committed an “unwillful act of omission.”Earlier in this hearing, deputy court chairman Bradley Fried said Hogg had committed an “unwillful act of omission.”
Bloomberg has the details:Bloomberg has the details:
“I definitely don’t believe it’s a hanging offence,” Fried told Parliament Tuesday.“I definitely don’t believe it’s a hanging offence,” Fried told Parliament Tuesday.
“It’s terribly unfortunate. It warrants grumpiness.”“It’s terribly unfortunate. It warrants grumpiness.”
Scandal, british-stylehttps://t.co/VklCR2PVz1 by @fergalob pic.twitter.com/Uh6yIRI9vXScandal, british-stylehttps://t.co/VklCR2PVz1 by @fergalob pic.twitter.com/Uh6yIRI9vX
12.17pm GMT12.17pm GMT
12:1712:17
12.16pm GMT12.16pm GMT
12:1612:16
Anthony Habgood says he has discussed the situation with governor Mark Carney -- apparently it was a “revelation” to Carney that Charlotte Hogg hadn’t declared her brother’s role at Barclays.Anthony Habgood says he has discussed the situation with governor Mark Carney -- apparently it was a “revelation” to Carney that Charlotte Hogg hadn’t declared her brother’s role at Barclays.
12.13pm GMT12.13pm GMT
12:1312:13
Committee chairman Andrew Tyrie wants more answers from BoE chairman Anthony Habgood.Committee chairman Andrew Tyrie wants more answers from BoE chairman Anthony Habgood.
Q: How many breaches of the Bank’s code of conduct are there?Q: How many breaches of the Bank’s code of conduct are there?
Habgood doesn’t know.Habgood doesn’t know.
I think it might be helpful to know, Tyrie points out.I think it might be helpful to know, Tyrie points out.
Q: What are the sanctions for failing to make a voluntary declaration?Q: What are the sanctions for failing to make a voluntary declaration?
It depends on the seriousness of it, Habgood says.It depends on the seriousness of it, Habgood says.
In most cases, he’d expect that the line manager and the HR department would speak to the individual and take a view.In most cases, he’d expect that the line manager and the HR department would speak to the individual and take a view.
Q: So why didn’t Charlotte Hogg declare her brother’s role as a Barclays strategy director when she was hired as chief operating officer in 2013?Q: So why didn’t Charlotte Hogg declare her brother’s role as a Barclays strategy director when she was hired as chief operating officer in 2013?
Habgood insists that it wasn’t a “wilful” decision.Habgood insists that it wasn’t a “wilful” decision.
He suggests that Hogg didn’t feel that her brother was in a position where it mattered - which was a mistake as she she shouldn’t take that decision.He suggests that Hogg didn’t feel that her brother was in a position where it mattered - which was a mistake as she she shouldn’t take that decision.
It was also an issue of priorities but it should have been high up her list of priorities as Charlotte Hogg helped develop the codes, Habgood points out...It was also an issue of priorities but it should have been high up her list of priorities as Charlotte Hogg helped develop the codes, Habgood points out...
12.00pm GMT12.00pm GMT
12:0012:00
Labour MP John Mann is now laying into the Bank of England’s top brass -- comparing Charlotte Hogg’s conduct to MPs who were jailed in the expenses scandal.Labour MP John Mann is now laying into the Bank of England’s top brass -- comparing Charlotte Hogg’s conduct to MPs who were jailed in the expenses scandal.
The standards of public life are about ethics and public responsibility, Mann insists.The standards of public life are about ethics and public responsibility, Mann insists.
He demands to know who is going to “sanction” Hogg for not declaring her brother’s role at Barclays back in 2013.He demands to know who is going to “sanction” Hogg for not declaring her brother’s role at Barclays back in 2013.
Mann tells BoE Court chairman Anthony Habgood that:Mann tells BoE Court chairman Anthony Habgood that:
She’s broken the standards in public life....and you’ve done nothing about it....She’s broken the standards in public life....and you’ve done nothing about it....
You must see that the independence of the Court is being brought into question.You must see that the independence of the Court is being brought into question.
Habgood says any sanction is the responsibility of her line manager, governor Mark Carney.Habgood says any sanction is the responsibility of her line manager, governor Mark Carney.
And he points out that Hogg did declare her brother’s role to the committee in her written submission last month (it’s online here). The problem, though, is that she didn’t declare it back in 2013 when she joined the Bank.And he points out that Hogg did declare her brother’s role to the committee in her written submission last month (it’s online here). The problem, though, is that she didn’t declare it back in 2013 when she joined the Bank.
Habgood says:Habgood says:
The standard is broken, that is correct.The standard is broken, that is correct.
But he argues that this isn’t a ‘black and white’ issue -- the Court must consider a range of factors (Hogg is highly regarded at the BoE). And there is definitely no personal gain here, Habgood insists.But he argues that this isn’t a ‘black and white’ issue -- the Court must consider a range of factors (Hogg is highly regarded at the BoE). And there is definitely no personal gain here, Habgood insists.
11.49am GMT11.49am GMT
11:4911:49
The Treasury Committee are laying into the Bank of England’s top brass over Charlotte Hogg’s failure to declare that her brother works for Barclays.The Treasury Committee are laying into the Bank of England’s top brass over Charlotte Hogg’s failure to declare that her brother works for Barclays.
Jacob Rees-Mogg (who knows a thing or two about high society), is challenging the idea that there hasn’t been a conflict of interest, actual or potential.Jacob Rees-Mogg (who knows a thing or two about high society), is challenging the idea that there hasn’t been a conflict of interest, actual or potential.
There aren’t a lot of people in the City called Quintin Hogg, points out Rees-Mogg.There aren’t a lot of people in the City called Quintin Hogg, points out Rees-Mogg.
He adds:He adds:
What’s worrying me is that the bank and the Court is pretty complacent about this.What’s worrying me is that the bank and the Court is pretty complacent about this.
It can’t have been wrong because we wouldn’t have behaved like that.It can’t have been wrong because we wouldn’t have behaved like that.
We won’t investigate it - we’ll just say there’s no conflict because the brother’s probably like us, he’s another good chap.We won’t investigate it - we’ll just say there’s no conflict because the brother’s probably like us, he’s another good chap.
Rees-Mogg is also unimpressed that Anthony Habgood doesn’t seem to actually know what Hogg. Q does at Barclays.Rees-Mogg is also unimpressed that Anthony Habgood doesn’t seem to actually know what Hogg. Q does at Barclays.
Deputy chairman Bradley Fried hits back at the suggestion that the Bank is a cushy institution where family background counts for a lot. We’re a “deeply forensic, fact-based institution” he insists.Deputy chairman Bradley Fried hits back at the suggestion that the Bank is a cushy institution where family background counts for a lot. We’re a “deeply forensic, fact-based institution” he insists.
11.28am GMT11.28am GMT
11:2811:28
Oh brother.... BoE deputy governor apologises for breaching Bank codeOh brother.... BoE deputy governor apologises for breaching Bank code
Now this is awkward....Now this is awkward....
Charlotte Hogg, the newly appointed deputy governor of the Bank of England, has admitted that she failed to disclose that her brother works for Barclays Bank.Charlotte Hogg, the newly appointed deputy governor of the Bank of England, has admitted that she failed to disclose that her brother works for Barclays Bank.
It’s a clear, and highly embarrassing, breach of the BoE’s code of conduct.It’s a clear, and highly embarrassing, breach of the BoE’s code of conduct.
Last month, Hogg told MPs Treasury Committee that she had reported her brother’s role as a strategy director at Barclays to the Bank, when she joined as its chief operating officer in 2013.Last month, Hogg told MPs Treasury Committee that she had reported her brother’s role as a strategy director at Barclays to the Bank, when she joined as its chief operating officer in 2013.
But now, in a letter to the Treasury Committee released this morning, Hogg admits that she didn’t.But now, in a letter to the Treasury Committee released this morning, Hogg admits that she didn’t.
Here’s the key section:Here’s the key section:
During my appointment hearing on 28 February 2017,1 was asked by you and other members of the Committee about my brother’s role as Director, Group Strategy at Barclays Bank pic.During my appointment hearing on 28 February 2017,1 was asked by you and other members of the Committee about my brother’s role as Director, Group Strategy at Barclays Bank pic.
Following my hearing, I checked the Bank’s records of the interests and relationships that I had declared prior to joining the Bank in July 2013 and subsequently. I had not formally declared my brother’s role at Barclays Bank pic to the Bank. The first time that I formally outlined my brother’s role was when I noted it in the questionnaire which I submitted to the Committee in advance of my recent hearing.Following my hearing, I checked the Bank’s records of the interests and relationships that I had declared prior to joining the Bank in July 2013 and subsequently. I had not formally declared my brother’s role at Barclays Bank pic to the Bank. The first time that I formally outlined my brother’s role was when I noted it in the questionnaire which I submitted to the Committee in advance of my recent hearing.
As Barclays Bank pic is regulated by the PRA, under the Bank’s internal code of conduct and personal relationships policy, I should have formally declared my brother’s role when I first joined the Bank. I did not do so and I take full responsibility for this oversight. I have now added a full record of my brother’s role in the Bank’s HR systems.As Barclays Bank pic is regulated by the PRA, under the Bank’s internal code of conduct and personal relationships policy, I should have formally declared my brother’s role when I first joined the Bank. I did not do so and I take full responsibility for this oversight. I have now added a full record of my brother’s role in the Bank’s HR systems.
Regrettably, my oversight means that my oral evidence to the Committee in this respect was not accurate. I write now to correct that evidence at the earliest opportunity and to place on record my sincere apologies to the Committee.Regrettably, my oversight means that my oral evidence to the Committee in this respect was not accurate. I write now to correct that evidence at the earliest opportunity and to place on record my sincere apologies to the Committee.
Hogg adds that the Secretary of the Bank and the Chaiman of the Bank’s Court of Directors, Anthony Habgood, agree that there has not been any actual or potential conflict of interest.Hogg adds that the Secretary of the Bank and the Chaiman of the Bank’s Court of Directors, Anthony Habgood, agree that there has not been any actual or potential conflict of interest.
But Andrew Tyrie, the chair of the Treasury committee, isn’t impressed at all.But Andrew Tyrie, the chair of the Treasury committee, isn’t impressed at all.
He’s quizzing Habgood about the issue now in parliament.He’s quizzing Habgood about the issue now in parliament.
Tyrie argues that this relationship becomes a “much more serious issue” now that Hogg has been promoted to deputy governor.Tyrie argues that this relationship becomes a “much more serious issue” now that Hogg has been promoted to deputy governor.
And doesn’t this breach show how seriously the Bank does (or doesn’t) take its approach to compliance?And doesn’t this breach show how seriously the Bank does (or doesn’t) take its approach to compliance?
Habgood agrees that this is “a very serious breach” of the Bank’s compliance code....Habgood agrees that this is “a very serious breach” of the Bank’s compliance code....
UpdatedUpdated
at 11.46am GMTat 11.46am GMT