Reform UK Demands Halt on Bank of England Bond Sales to Save Taxpayers £100 Billion

Reform UK's deputy leader Richard Tice has written to Chancellor John Healey urging him to halt the Bank of England's bond sales, which he claims could save taxpayers close to £100 billion.

The Bank of England purchased £895 billion of UK government bonds during the financial crisis and Covid pandemic to support the economy. It is now actively selling a portion of these bonds back to the market, often at prices lower than it originally paid.

Tice argues that halting bond sales entirely would provide an annual windfall of £20 billion, which he suggests could be used to fund higher defence spending. He points out that the Office for Budget Responsibility expects payments from the Treasury to the Bank to rise to £94 billion by 2030, and halting the programme now would avoid further losses.

The Bank of England has rejected this criticism, warning that changing the terms of interest payments on reserves could undermine its ability to control the price of money. Governor Andrew Bailey has stated that altering these payments would be equivalent to a 'bank tax' that would ultimately be passed on to customers.