Source · Select Committees · Treasury Committee
Recommendation 1
1
Acknowledged
Potential benefits of a digital pound for the UK economy remain unclear in extent and necessity.
Conclusion
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. (Paragraph 29) Risks and challenges from a digital
Government Response Summary
The government acknowledges the committee's observation on potential benefits, reiterating that the design process itself will foster knowledge-sharing and collaboration, which are valuable regardless of the final decision to introduce a digital pound.
Government Response
Acknowledged
HM Government
Acknowledged
The Committee’s report highlights the wider indirect benefits for the UK’s competitiveness from this work. The process of developing the design for a digital pound over the coming years will present enduring benefits for the UK’s digital economy, fostering knowledge-sharing and technical collaboration between the public and private sectors. These efforts are valuable, regardless of whether a decision is ultimately taken to introduce a digital pound. The assessment would look at the contribution of the digital pound to the objectives of the Government and the Bank. In particular, ensuring that where appropriate, central bank money remains available and useful in an ever more digital economy, continuing to support UK monetary and financial stability, and providing a public platform for private-sector innovation, promoting further competition, efficiency and choice in payments.