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| Email mistake reveals Bank of England's EU exit project | Email mistake reveals Bank of England's EU exit project |
| (about 7 hours later) | |
| The Bank of England has confirmed it is researching the financial risks of the UK leaving the EU after it "inadvertently" sent details of its work to a national newspaper. | The Bank of England has confirmed it is researching the financial risks of the UK leaving the EU after it "inadvertently" sent details of its work to a national newspaper. |
| A senior official sent an email about its confidential project on the issue to an editor at the Guardian newspaper. | A senior official sent an email about its confidential project on the issue to an editor at the Guardian newspaper. |
| A spokesman for the bank described the error as "unfortunate". | A spokesman for the bank described the error as "unfortunate". |
| Prime Minister David Cameron has promised an in/out referendum on the UK's EU membership by the end of 2017. | Prime Minister David Cameron has promised an in/out referendum on the UK's EU membership by the end of 2017. |
| Labour's shadow chancellor Chris Leslie called for "a full and informed debate, not clandestine processes shrouded from public view". | |
| The email indicates a small group of senior staff are to examine the economic effects of the UK leaving the EU under the authority of Sir Jon Cunliffe, who is the deputy director for financial stability, the Guardian says. | |
| The email also spells out that should anyone ask about the project - codenamed Project Bookend - the taskforce should say it concerns "a broad range of European economic issues", and not make any reference to the forthcoming referendum. | The email also spells out that should anyone ask about the project - codenamed Project Bookend - the taskforce should say it concerns "a broad range of European economic issues", and not make any reference to the forthcoming referendum. |
| Analysis | |
| By BBC business correspondent Joe Lynam | |
| Imagine the outrage if - the morning after Britain had voted to quit the EU - the Bank of England put out a statement saying: "We start work today on how 'Brexit' might affect the markets and UK firms." | |
| First of all we'd ask why do we pay these people to react rather than pre-empt massive outcomes. | |
| Secondly it might have already been too late. | |
| There might have been a huge sell-off in sterling. Government bonds - known as gilts - might have plunged in value, meaning the cost of borrowing for the Treasury might have soared overnight. | |
| Britain's major listed companies might have seen billions wiped off their value in early trading. | |
| Of course none of that might happen. | |
| Markets might have been very sanguine about quitting the EU. But we don't know and the only way the Bank of England would know was if it did some quiet preparatory work - outside the glare of publicity. | |
| That latter hope is now forlorn. | |
| The email, from Sir Jon Cunliffe's private secretary to four senior executives, was written on 21 May, the Guardian reported. | The email, from Sir Jon Cunliffe's private secretary to four senior executives, was written on 21 May, the Guardian reported. |
| James Talbot, the head of the monetary assessment and strategy division, was also involved in Project Bookend, the paper said. | James Talbot, the head of the monetary assessment and strategy division, was also involved in Project Bookend, the paper said. |
| The email is quoted as saying: "Jon's proposal, which he has asked me to highlight to you, is that no email is sent to James's team or more broadly around the Bank about the project. | The email is quoted as saying: "Jon's proposal, which he has asked me to highlight to you, is that no email is sent to James's team or more broadly around the Bank about the project. |
| "James can tell his team that he is working on a short-term project on European economics in International [division] which will last a couple of months. This will be in-depth work on a broad range of European economic issues. Ideally he would then say no more." | "James can tell his team that he is working on a short-term project on European economics in International [division] which will last a couple of months. This will be in-depth work on a broad range of European economic issues. Ideally he would then say no more." |
| The memo goes on to propose that questions from "other parties" about "whether this was a project to look at the referendum", should be given the answer, "that there is a lot going on in Europe in the next couple of months - pointing to some of the specific European economic issues (eg: Greece) that would be of concern to the Bank". | The memo goes on to propose that questions from "other parties" about "whether this was a project to look at the referendum", should be given the answer, "that there is a lot going on in Europe in the next couple of months - pointing to some of the specific European economic issues (eg: Greece) that would be of concern to the Bank". |
| 'Not sensible' | 'Not sensible' |
| A statement from the bank said: "Today, information related to planned confidential Bank work on the potential implications of a renegotiation and national referendum on the UK's membership of the European Union made its way into the public domain, due to an internal email sent inadvertently to an external party. | A statement from the bank said: "Today, information related to planned confidential Bank work on the potential implications of a renegotiation and national referendum on the UK's membership of the European Union made its way into the public domain, due to an internal email sent inadvertently to an external party. |
| "There are a range of economic and financial issues that arise in the context of the renegotiation and national referendum. It is one of the Bank's responsibilities to assess those that relate to its objectives. | "There are a range of economic and financial issues that arise in the context of the renegotiation and national referendum. It is one of the Bank's responsibilities to assess those that relate to its objectives. |
| "It is not sensible to talk about this work publicly, in advance. But as with work done prior to the Scottish referendum, we will disclose the details of such work at the appropriate time. | "It is not sensible to talk about this work publicly, in advance. But as with work done prior to the Scottish referendum, we will disclose the details of such work at the appropriate time. |
| "While it is unfortunate that this information has entered the public domain in this way, the Bank will maintain this approach." | "While it is unfortunate that this information has entered the public domain in this way, the Bank will maintain this approach." |
| 'No wall of love' | |
| Mr Leslie, who was appointed shadow chancellor after Ed Balls' election defeat, told the BBC the email raised questions about whether the report would be published, if so when, and whether businesses, the Treasury or the Office for Budget Responsibility (OBR) would be consulted and whether the chancellor knew about the assessment. | |
| BBC business correspondent Joe Lynam said the Bank of England would have kept the project secret to avoid becoming a political "actor" in the referendum. | |
| The bank had appeared to be "slightly dragged into" the debate ahead of the referendum on Scottish independence, he said. | |
| He added that there was no evidence that talk on Twitter of it being a deliberate leak was accurate. | |
| On Friday Mr Cameron met European counterparts for the first time since his general election victory, and admitted he was "not met with a wall of love" as he began diplomatic negotiations aimed at securing changes to the UK's relationship with Brussels. | On Friday Mr Cameron met European counterparts for the first time since his general election victory, and admitted he was "not met with a wall of love" as he began diplomatic negotiations aimed at securing changes to the UK's relationship with Brussels. |
| At a summit in the Latvian capital Riga he conceded that securing a deal would take "patience and tenacity" and refused to ruled out campaigning for Britain to leave the EU if his renegotiation efforts failed. | At a summit in the Latvian capital Riga he conceded that securing a deal would take "patience and tenacity" and refused to ruled out campaigning for Britain to leave the EU if his renegotiation efforts failed. |
| EU referendum in focus | EU referendum in focus |
| David Cameron is ready to start renegotiating the terms of Britain's EU membership ahead of a referendum. Here is some further reading on what it all means: | David Cameron is ready to start renegotiating the terms of Britain's EU membership ahead of a referendum. Here is some further reading on what it all means: |
| The UK and the EU: Better off in or out? | The UK and the EU: Better off in or out? |
| What Britain wants from Europe | What Britain wants from Europe |
| Q&A: The UK's planned EU referendum | Q&A: The UK's planned EU referendum |
| Timeline: EU referendum debate | Timeline: EU referendum debate |
| Why Germany is David Cameron's new best friend | Why Germany is David Cameron's new best friend |