Select committee: Treasury Committee
Conclusion 1
First Report - The digital pound: still a solution in search of a problem?
Published 2 Dec 2023
Paragraph 29
Addressed to HM Treasury
Treasury Committee The crypto-asset industry All items in this report Report on parliament.uk ↗ Inquiry on parliament.uk ↗
Conclusion (the committee's words)
There are some potential benefits to the UK economy from a digital pound. A digital pound could help support innovation in domestic payments, while guarding against some of the risks posed by new forms of private digital money by maintaining public access to a form of central bank money. Innovation brought about by a digital pound could also support the UK’s international competitiveness in payments (and related) technologies, particularly if it is amongst the first major central banks to issue a retail CBDC. The extent of these benefits is unclear, however. Nor is it yet clear that a digital pound is the only (or best) means of achieving them.
From: Treasury Committee, First Report - The digital pound: still a solution in search of a problem? (HC 215), paragraph 29, 2 December 2023
Government response
The government responded to the whole report on 31 January 2024 (deadline 1 February 2024).
Summary written by Accountability Index from the government's response. It is not the government's own words.HM Treasury and the Bank of England say that no decision has been taken on whether to introduce a digital pound, and that the design phase will inform a decision "later this decade".
- On privacy, they "agree that strong privacy safeguards would be vital" and say the Government "has committed to guaranteeing users' privacy in primary legislation if a digital pound were launched".
- On interest, they do not commit to further analysis or to keeping the option open: a digital pound "would be unremunerated at launch", and any later change would be "preceded by a review with full consultation".
- On costs, the Bank "acknowledges" the request for a separate line item and says it "will consider the appropriate reporting mechanism going forward".
- On holding limits, they are "minded to proceed at this stage" with a £10,000 to £20,000 limit, "at least during the introductory period", while remaining "open to revisiting the bounds of this range if new information came to light".