The Report of the Committee on the Working of the Monetary System (commonly known as The Radcliffe Report) is a report published in 1959 about monetary policy and the workings of the

Bank of England The Bank of England is the central bank of the United Kingdom and the model on which most modern central banks have been based. Established in 1694 to act as the English Government's banker, and still one of the bankers for the Government of ...

. It is named after its

chairman The chairperson, also chairman, chairwoman or chair, is the presiding officer of an organized group such as a board, committee, or deliberative assembly. The person holding the office, who is typically elected or appointed by members of the grou ...

Cyril Radcliffe, 1st Viscount Radcliffe Cyril John Radcliffe, 1st Viscount Radcliffe, (30 March 1899 – 1 April 1977) was a British lawyer and Law Lord best known for his role in the Partition of India. He served as the first chancellor of the University of Warwick from its foundatio ...

. The report started collecting evidence in 1957 and was the result of dissatisfaction with the workings of

monetary policy Monetary policy is the policy adopted by the monetary authority of a nation to control either the interest rate payable for very short-term borrowing (borrowing by banks from each other to meet their short-term needs) or the money supply, often a ...

in the 1950s. It still today remains an important reference document on the

Context of creation

Monetary theory made progress after the interwar years but was disrupted by the war. After the

second world war World War II or the Second World War, often abbreviated as WWII or WW2, was a world war that lasted from 1939 to 1945. It involved the vast majority of the world's countries—including all of the great powers—forming two opposin ...

, the context was adequate to start rethinking how to run

and this is when the Radcliffe Committee was set up. The committee was composed of Lord Radcliffe, Professor Cairncross, Sir Oliver Franks, Viscount Harcourt, W. E. Jones, Professor Sayers, Sir Reginald Verdon Smith, George Woodcock and Sir John Woods.

The 339-pages report reviews British

since 1931 to give recommendations. The report downplays the importance of keeping

money supply In macroeconomics, the money supply (or money stock) refers to the total volume of currency held by the public at a particular point in time. There are several ways to define "money", but standard measures usually include Circulation (curren ...

within strict limits as well the importance of

. The report generally was a way to get more control over the Bank of England, suggesting for example to let the

Chancellor of the Exchequer The chancellor of the Exchequer, often abbreviated to chancellor, is a senior minister of the Crown within the Government of the United Kingdom, and head of His Majesty's Treasury. As one of the four Great Offices of State, the Chancellor is ...

to announce changes in Bank rate instead of the

Aftermath and impact

The clear impact of the report on

is debated and its actual influence on policy is limited. Economist

Anna Schwartz Anna Jacobson Schwartz (pronounced ; November 11, 1915 – June 21, 2012) was an American economist who worked at the National Bureau of Economic Research in New York City and a writer for ''The New York Times''. Paul Krugman has said that Schwar ...

, 10 years after the publication of the report, wrote that research in the following years gave "no support to the views expressed in the Radcliffe Report". One of the main recommendations was that if the commercial banks nor

Trustee Savings Bank A bank is a financial institution that accepts deposits from the public and creates a demand deposit while simultaneously making loans. Lending activities can be directly performed by the bank or indirectly through capital markets. Becaus ...

introduced a Giro system for mass banking, the

General Post Office The General Post Office (GPO) was the state postal system and telecommunications carrier of the United Kingdom until 1969. Before the Acts of Union 1707, it was the postal system of the Kingdom of England, established by Charles II in 1660. ...

should investigate introducing it. In 1965 when the new Labour Government published a

white paper A white paper is a report or guide that informs readers concisely about a complex issue and presents the issuing body's philosophy on the matter. It is meant to help readers understand an issue, solve a problem, or make a decision. A white paper ...

"A Post Office Giro", outlining such a system with a computerised central system for processing transactions. Subsequently National Girobank was created in 1968.

References

{{reflist Monetary economics

Context of creation

Contents

Aftermath and impact

References