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<p>The Treasury has statutory powers to issue directions to the Bank of England, which
can only be used under specific conditions or circumstances. None of the powers outlined
below have ever been used.</p><p> </p><ul><li>Under section 4 of the Bank of England
Act 1946, the Treasury may direct the Bank, after consultation with the Governor,
to action that is deemed to be necessary in the public interest. This power of direction
applies to all of the Bank’s activities, with the exception of monetary policy and
the exercise of the Bank’s functions as the Prudential Regulation Authority (PRA).</li></ul><p>
</p><ul><li>Under section 19 of the Bank of England Act 1998, the Treasury may by
order, after consultation with the Governor, direct the Bank with respect to monetary
policy if it is deemed to be in the public interest and required by extreme economic
circumstances.</li></ul><p> </p><ul><li>Under section 410 of the Financial Services
and Markets Act 2000, the Treasury may direct the PRA and the Bank to not take an
action that would be incompatible with the UK’s international obligations.</li></ul><p>
</p><ul><li>Under Section 61 of the Financial Services Act 2012, the Treasury may
direct the Bank on specific measures relating to the assistance to or stabilisation
of financial institutions.</li></ul><p> </p><p> </p><p>The Bank of England also has
powers to direct the Prudential Regulation Authority (PRA), Financial Conduct Authority
(FCA) and Payment Systems Regulator (PSR).</p><p> </p><ul><li>Under section 9H of
the Bank of England Act 1998, the Bank of England’s Financial Policy Committee (FPC)
has powers of direction over the PRA and FCA (limited to the use of specific macroprudential
tools). To date, the FPC has only ever used this power to implement the Leverage Ratio.</li></ul><p>
</p><ul><li>Under sections 9Y and 9Z of the Bank of England Act 1998, the Bank may
direct the FCA to provide documents or information that the Bank reasonably requires
for its financial stability functions. This power has never been used.</li></ul><p>
</p><ul><li>Under section 100 of the Financial Services (Banking Reform) Act 2013,
the Bank has the power to direct the PSR not to exercise its powers, under specific
circumstances. This power has never been used.</li></ul><p> </p>
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