U.K. lawmakers on Friday said the Treasury could not explain the effect of the quantitative easing on the whole economy. The panel said some GBP 375 billion has so far been injected into the economy as an 'experiment'.

"The Treasury has not convinced us it understands either the risks it has taken on by indemnifying the Bank of England against losses on Quantitative Easing or the expected economic benefits," the Public Accounts Committee said in an annual report.

Further, lawmakers said, "The Treasury's attempts to stimulate economic growth through new lending have, so far, not been successful." The treasury should be clear what it wants this BoE scheme to achieve and how it intends to monitor it.

"Throughout, the Treasury seems to be embarking on a series of expensive experiments, indemnified with taxpayers' money," the report said.

The panel observed that high staff turnover reduced the Treasury's ability to respond to crises and manage public spending effectively. Although staff turnover declined in 2011-12, it is still "very high."

2013-2-15 11:17