Bank of England Pay Deal Makes Mark Carney World's Most Expensive Central Banker

The UK Treasury is facing criticism over the pay and benefits package agreed for the incoming Governor of the Bank of England which will make him the world's most expensive central banker.

Current Bank of Canada Governor Mark Carney, who will take over from Mervyn King in July of next year, will be paid just under £1m each year, documents published on the BoE's website revealed, in a deal that includes a £250,000 annual housing allowance.

"Although the next Governor's salary of £480,000 is considerably higher than the salary of the current Governor (£305,000) the cost to the Bank of enrolling him in the now closed Pension Scheme previously available to the Governor and Deputy Governors would approximate to more than 100% of salary," the Bank said in a statement. "This compares with the 30% cash allowance in lieu of pension to which the next Governor will become entitled.

Collectively, the salary and benefits mean Carney, a former Goldman Sachs investment banker, will earn around £874,000 each year of his five year term, which is set to begin on 1 July 2013. The published salary range for his seven year term with the Bank of Canada was between C$365,200 and C$429,600. (£227,000 and £267,000).

The average annual UK salary £26,244, according to the Office for National Statistics. Prime Minister David Cameron earns a salary of £142,000 each year while his Chancellor George Osborne - the man who lobbied hardest to bring in the first non-native Briton to run the bank in its 394 year history - earns £134,565.

"After some spectacular failures at the Bank of England, hard-pressed families are hoping that Carney can help mend our broken financial system," said Matthew Sinclair, chief executive of the TaxPayers' Alliance. "When the government is rightly planning to cap housing benefit, it will certainly stick in the throat of many that Mr Carney is receiving more per year in housing allowance than the average price of a British home."

Glenn Stevens, who runs the Reserve Bank of Australia, was said to be the most expensive of all the world's major central bankers after a pay increase in 2010 took his annual remuneration to A$1.05m (£645,000) each year. The latest RBA report, however, shows his 2012 salary slipped to A$995,142.

Norman Chan, who runs the Hong Kong Monetary Authority, earns around £475,000 each year while Thomas Jordan, head of the Swiss National Bank, is said to be paid around 990,000 Swiss francs (£688,000) each year based on the pay of his predecessor, Philipp Hilderbrand.

The maximum salary at the European Central Bank is €242,988 each year, according to its website.

Ben Bernanke, who runs the US Federal Reserve and has his salary set by lawmakers in Congress, earns $199,700 each year. Financial disclosure forms show the former Princeton Economics professor also made around $150,000 in textbook royalties last year.

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