By George, Another Five Years for Eddie

Article excerpt

Bank of England Governor Mr Eddie George could be offered a new five year deal that will keep him in the hot seat at Threadneedle Street beyond the next election.

Weekend speculation had suggested he would only get a two year extension, but insiders have insisted stability is now viewed as vital.

The five-year deal Chancellor Mr Gordon Brown intends to offer Mr George would take him to 2003 - a point at which the decision over Britain's participation in the single currency is likely to have been made.

To appoint a new Governor in the middle of preparations for the British decision would risk rocking the boat.

Though the Chancellor has yet to discuss the matter with Mr George formally, provided he wants to stay, the job of Governor remains his.

Mr Brown's decision ends a period of speculation in which it has been suggested the Chancellor has been casting around for an alternative to Mr George.

But, according to informed sources, Mr Brown now believes stability is the critical factor and the best option is to renew 59year-old Mr George's contract.

Just days after handing Mr George and a Bank of England Monetary Policy Committee operational independence to set interest rates, the Governor was stung by Mr Brown's decision to strip the Bank of supervisory powers over the rest of the banking system. …