HM Treasury News Release
129/97                                       28 October 1997
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       "PROMOTING LONG TERM STABILITY" - ALISTAIR DARLING
                                
                 Bank of England Bill Published


The Bank of England Bill establishes a new framework which
will promote economic stability and give a long-term focus to
monetary policy the Chief Secretary, Alistair Darling said
today on publication of the Bill.

The main provisions of the Bill are the establishment of the
Monetary Policy Committee and the transfer of banking
supervision to the Financial Services Authority (FSA).

On the monetary policy provisions, Mr Darling said:

     "The Bill introduces important changes to the Bank to
     ensure that it can act effectively and efficiently in its
     new role, and to promote a stronger financial system. Its
     publication marks another milestone in our determination
     to modernise Britain's economy and create a modern Bank
     that can meet the new challenges of the 21st century.

     "The new framework will promote economic stability and
     will give a long-term focus to monetary policy in support
     of the Government's objectives for growth and employment.

     "Low inflation means greater certainty for investors and
     savers, reduced costs and improved competitiveness.

     "In the long run, price stability is the main
     contribution monetary policy can make to achieving
     sustained high growth and employment."

Mr Darling also said transparency and accountability were
important features of the new framework. He said:

     "The new framework maximises openness and transparency
     and ensures that the Bank is fully accountable and that
     its conduct of monetary policy meets the economic needs
     of the nation.

     "The Bank will conduct policy in an open and transparent
     manner and will be accountable to Parliament especially
     through enhanced scrutiny by the Treasury Select
     Committee."

On the transfer of banking supervision, the Chief Secretary
said:

     "This is the first stage of a complete overhaul and
     modernisation of the supervision and regulation of the
     financial services sector. It will mean more effective
     and efficient regulation of financial services.

     "The changing market of the 1990s and beyond makes it
     essential to bring regulation of banking, securities and
     insurance under one roof. This move will modernise our
     regulatory structure - creating a new regulator that will
     command the respect of markets here and throughout the
     world."

NOTES TO EDITORS

1.   Further information on the Bank of England Bill is
available in Treasury News Release 128/97.

2.   A note on the main provisions of the Bill is available
from the Treasury on 0171 270 5185 (media copies) and 0171 270
4860/4870 (non-media copies).

3.   If you have access to the Internet you can find this news
release at http://www.hm-treasury.gov.uk.  Material on other 
Treasury issues can also be found at this site.