Bailey was wrong in meddling in wage policy, says top economist

One of the UK’s leading economists has criticized the Governor of the Bank of England for his handling of the cost of living crisis.

Lord O’Neill believes Andrew Bailey should never have gotten into the wage debate as it is a decision between employers and their employees.

O’Neill told the Daily Mail: ‘Andrew made a mistake. He shouldn’t have been so specific about having a view on individual pay increases, that’s the role of the employer and their employees or their union to fight that out.’

Critic: Lord O’Brien (pictured) took a close look at Bank of England’s booing Andrew Bailey for his handling of the cost of living crisis

Bailey has repeatedly urged employees to “think and think” before asking for raises.

In May, he told the Treasury’s selection committee, “I think people, especially those with higher incomes, should think and think about asking for high pay raises.”

O’Neill made his name at Goldman Sachs, where he was best known for creating BRICs, the acronym for Brazil, Russia, India and China.

He became a Conservative minister in 2015 under then Prime Minister David Cameron, a post he held until his resignation in 2016 when Theresa May came to power.

He also said the Bank should have raised interest rates more quickly to address rising inflation, and should have ended quantitative easing earlier.

He added: ‘They made mistakes. We should have let rates rise earlier and the past few years of quantitative easing should never have happened.

If it had happened, some of the sensitivity wouldn’t have been so strong.’ He continued: “It is important that inflation expectations do not become entrenched and that we end up back in this mess of the 1960s.”

Inflation reached a 40-year high of 9.1 percent in May and the Bank of England expects it to rise further, to above 11 percent in October.

As a result, the Bank raised interest rates five times in succession to 1.25 percent. Earlier this week, Bailey pledged to bring inflation back to the Bank’s target of 2 percent, adding that the central bank could raise interest rates more than before in response to rising price increases.

O’Neill expressed some sympathy for the governor: “I feel sorry for him. This is a huge problem that the Bank of England is in the middle of.”

He also described the withdrawal of the Bank’s independence as “crazy” after hopeful Tory leaders – including Tom Tugendhat – targeted the Old Lady.

#fiveDealsWidget .dealItemTitle#mobile {display:none} #fiveDealsWidget {display:block; hover:left; clean up both; max-width:636px; margin:0; padding:0; line height:120%; font-size:12px} #fiveDealsWidget div, #fiveDealsWidget a { margin:0; padding:0; line height:120%; text decoration: none; font-family:Arial, Helvetica ,sans-serif} #fiveDealsWidget .widgetTitleBox { display:block; hover:left; width: 100%; background color:#af1e1e; } #fiveDealsWidget .widgetTitle {color:#fff; text transformation: capital letters; font size:18px; font weight:bold; margin: 6px 10px 4px 10px; } #fiveDealsWidget a.dealItem { float:left; display:block; width:124px; margin-right:4px; margin-top:5px; background color: #e3e3e3; min-height:200px;} #fiveDealsWidget a.dealItem#last {margin-right:0} #fiveDealsWidget .dealItemTitle {display:block; margin: 10px 5px; color:#000; font-weight:bold} #fiveDealsWidget .dealItemImage, #fiveDealsWidget .dealItemImage img { float:left; display:block; margin:0; padding:0} #fiveDealsWidget .dealItemImage {border:1px solid #ccc} #fiveDealsWidget .dealItemImage img {width:100%; height:auto} #fiveDealsWidget .dealItemdesc {float:left; display:block; color:#004db3; font weight:bold; margin:5px; } #fiveDealsWidget .dealItemRate { float:left; display:block; color:#000; margin:5px} #fiveDealsWidget .dealFooter { display:block; hover:left; width: 100%; margin-top:5px; background-color:#e3e3e3 } #fiveDealsWidget .footerText {font-size:10px; margin:10px 10px 10px 10px; } @media (max-width: 635px) { #fiveDealsWidget a.dealItem { width:19%; margin-right:1%} #fiveDealsWidget a.dealItem#last {width:20%} } @media (max-width: 560px) { #fiveDealsWidget #desktop {display:none;} #fiveDealsWidget #mobile {display:block! important} #fiveDealsWidget a.dealItem { backgroundcolor: #fff; height:car; min-height:auto} #fiveDealsWidget a.dealItem { border-bottom:1px solid #ececec; margin bottom:5px; padding-bottom:10px} #fiveDealsWidget a.dealItem#last { border-bottom:0px solid #ececec; margin bottom:5px; padding-bottom:0px} #fiveDealsWidget a.dealItem, #fiveDealsWidget a.dealItem#last {width:100%} #fiveDealsWidget .dealItemContent, #fiveDealsWidget .dealItemImage {float:left; display:inline-block} #fiveDealsWidget .dealItemImage { width:35%; margin-right:1%} #fiveDealsWidget .dealItemContent {width:63%} #fiveDealsWidget .dealItemTitle { margin: 0px 5px 5px; font-size:16px} #fiveDealsWidget .dealItemContent .dealItemdesc, #fiveDealsWidget .dealItemContent .dealItemRate {clear:both} }