Pill asked on remuneration of reserves. Says that anything that interferes with that is something that the BOE can't accept. Pill says that we need an operational framework that includes remunerating reserves at Bank Rate that allows that to take place. Anything that interferes with that is something the BOE can't accept. There is a fundamentally fiscal question. If you think the Bank Bank is established and transmits at the marginal decision then maybe you only need to remunerate at the margin and intra-marginally you could do other things. But crucially that is a fiscal issue. Not really something for the Bank to have a view on. If the govt wants to tax banks, they should do that transparently, not intransparently through the BOE balance sheet otherwise it starts to blur the lines between fiscal and monpol.
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