Budapest Post

Cum Deo pro Patria et Libertate
Budapest, Europe and world news

Bank of England Rebuked Over ‘Missing’ $67 Billion of Cash

Bank of England Rebuked Over ‘Missing’ $67 Billion of Cash

A parliamentary committee found about 50 billion pounds worth of cash in circulation is not being spent, and blasted the bank for a lack of “curiosity” about where it is.
While the economic turmoil wrought by the coronavirus pandemic has left some people in Britain counting every penny, the country’s central bank is apparently having trouble keeping track of billions of pounds.

A parliamentary report released on Friday said that 50 billion pounds (about $67 billion) of paper money is “missing” from the country’s cash supply and that the Bank of England “seems to lack curiosity” about where it’s all gone.

Of the more than £70 billion worth of bills in circulation in Britain, the report found that only about a quarter was being spent in stores and on other purchases. That leaves the majority of those bills - which by design are not traceable - unaccounted for.

The £50 billion in cash may be hidden away in unreported household savings, squirreled away for a rainy day, or is being used for more nefarious purposes, Parliament’s Public Accounts Committee said in the report, calling on the Bank of England to investigate.

“£50 billion of sterling notes - or about three-quarters of this precious and dwindling supply - is stashed somewhere, but the Bank of England doesn’t know where, who by or what for - and doesn’t seem very curious,” said Meg Hillier, the lawmaker for the Hackney South and Shoreditch areas of London and chair of the committee that produced the report.

The Bank of England hit back at the suggestion it was taking a laissez-faire approach to the issue.

“It is the responsibility of the Bank of England to meet public demand for bank notes. The bank has always met that demand and will continue to do so,” a spokeswoman from the central bank said in a statement on Friday.

“Members of the public do not have to explain to the bank why they wish to hold bank notes. This means that bank notes are not missing,” the bank’s statement said.

The pandemic has led to a slump in cash payments, but demand for bills has risen in recent years and the pandemic has accelerated that trend, the report said. The value of paper (and polymer) bills in circulation in Britain hit a record high in July of £76.5 billion.

One reason might be that interest rates, which have been low for years, were cut even further this year to boost the British economy.

“With interest rates so low, it doesn’t really matter whether you keep money in the bank or keep it in cash,” said Andrew Sentance, a senior adviser at Cambridge Econometrics and a former member of the Bank of England’s monetary policy committee. The current base rate of 0.1 percent means “a lot of people will have more cash in their wallet than they usually have.”

Still, the public accounts committee - which scrutinizes the economy and spending - is unconvinced by that explanation and is concerned that a substantial proportion of the £50 billion has been siphoned off and is being used for illegal activity such as money laundering in the shadow economy, whether in Britain or abroad.

“Are more of us putting money under the mattress because of Covid? It would have to be a lot of us doing that,” Ms. Hillier said in an interview on Friday. She added that the gap between notes in circulation and those actually being used “must be linked to crime.”

The parliamentary committee hopes an investigation by the Bank of England may shed some light, if not on where it is being held, then at least on the factors behind the increase in demand for cash.

For its part, the Bank of England said the amount of paper money being used for transactions in Britain - around 20 to 25 percent of all cash in circulation - was broadly in line with other major economies.
AI Disclaimer: An advanced artificial intelligence (AI) system generated the content of this page on its own. This innovative technology conducts extensive research from a variety of reliable sources, performs rigorous fact-checking and verification, cleans up and balances biased or manipulated content, and presents a minimal factual summary that is just enough yet essential for you to function as an informed and educated citizen. Please keep in mind, however, that this system is an evolving technology, and as a result, the article may contain accidental inaccuracies or errors. We urge you to help us improve our site by reporting any inaccuracies you find using the "Contact Us" link at the bottom of this page. Your helpful feedback helps us improve our system and deliver more precise content. When you find an article of interest here, please look for the full and extensive coverage of this topic in traditional news sources, as they are written by professional journalists that we try to support, not replace. We appreciate your understanding and assistance.
Newsletter

Related Articles

0:00
0:00
Close
OpenAI Sued After ChatGPT Allegedly Discouraged Emergency Care Before Near-Fatal Embolism
Miliband Sets Climate and International Law at Centre of UK Diplomacy
Czech Central Bank Governor Rejects Early Euro Entry and Rate-Cut Pressure
Trump Readies New Tariffs as Temporary Global Levy Nears Expiry
Vivienne Westwood Casts Cicciolina, 74, in Its New Autumn Campaign
Dejavu: Germany’s Military Expansion Reshapes Europe’s Strategic Balance With France
Morgan Stanley Builds a Wall Street Lead in AI Infrastructure Finance
High Prices Push Coffee Drinkers Toward Whole Beans and Home Brewing
Trump Draws Boos and Podium Scrutiny at Spain’s World Cup Triumph
Brilliant move: Péter Magyar Moves to Nominate Chess Grandmaster Judit Polgár as Hungary’s President
Spain Defeats Argentina in Extra Time to Win Second World Cup
Current AI Seeks to Build an Open Global AI Infrastructure Outside Big Tech Control
Germany’s Economic Malaise Reopens the Sunday Shopping Debate
Proposed U.S.-Saudi Nuclear Pact Could Permit Limited Uranium Enrichment Under International Safeguards
Netherlands Declares Water Shortage Emergency After Drought Pushes Rivers to Historic Lows
Why Kentucky Fried Chicken Became KFC—and Why the False Explanations Persist
Ukrainian Drones Strike Wildberries Warehouses Deep Inside Russia
Reported CIA Mission Helped Clear the UAE’s Path to Advanced US AI Chips
Artificial Intelligence Capital Fuels Markets While Governments and Regulators Face Mounting Strategic Tests
China’s Moonshot’s Kimi K3 Narrows the Gap With Anthropic Through Scale, Openness and Lower Cost
The Ledger Will Not Trust on Faith
Trump Administration Pressures Banks to Restrict Financial Access for Undocumented Immigrants
Passenger Bound for Germany Refused to Sit Beside a Woman on a Plane — Then Slapped a Flight Attendant
Ukraine’s Leadership Rift Spills Into the Streets as Protesters Target Army Chief
Ukrainian Drone Barrage Kills Eight and Strikes Russian Logistics Network
The Ten World Cup Finals That Defined Football History
Smartphones Are Getting More Expensive, Sales Are Collapsing, and Even Apple Admits: "Prices Will Rise"
The Monaco Bombing Has Become a Test of Ukraine’s Intelligence Accountability
Leadership Change and Strategic Rivalry Redraw the Political Map
The AI Race Enters Its Infrastructure Era
Britain Nationalises British Steel to Protect Scunthorpe Production and Strategic Supply
French National Assembly Overrides Senate to Pass Historic Assisted-Dying Legislation
Spanish Prime Minister's Wife Ordered to Stand Trial as Corruption Probes Encircle Governing Party
Zelensky Faces Kyiv Protests Over Ousting of Dynamic Ukrainian Defense Minister
Thomas Tuchel Faces Fierce Backlash After Tactical Retreat Costs England World Cup Final Berth
A Quiet Bastille Day: France Grapples with World Cup Heartbreak and Leftover Fireworks
Spain in Ecstasy: "We Feel Unbeatable, We Taught the Whole World a Lesson"
Spain and UK Dismantle Gibraltar Border Following Landmark Schengen Integration Treaty
Hungary's "Puppet" President to Be Ousted, Orbán Fumes: "Democracy Is Dead"
Forget Tinder: The Surprising Platform Where People Find Love
Harvard Astrophysicist to Lead U.S. Scientific Advisory on Unidentified Aerial Phenomena
Emergency Sirens Activated Across Bahrain as Interior Ministry Issues Shelter Directives
World Cup Visitors Turn American Big-Box Stores Into Souvenir Stops
Netflix Weighs Always-On Channels, Bundles and Short-Form Video
Passenger Is Pulled Partly Outside Ryanair Jet After Window Fails Mid-Flight
The AI Invoice Shock: Layoffs Didn't Save Managers Money — They Cost Them More
Concern: Sexually Transmitted Bacterium Among Men Develops Antibiotic Resistance
Passenger Partially Pulled Out of Ryanair Jet After Cabin Window Fails Mid-Flight
Severe Heatwave Drives Dangerous Ground-Level Ozone Pollution Across Two Thirds of European Union
The Physical and Electronic Barriers Disrupting Domestic Wireless Networks
×