Former Bank of England Governor Mark Carney has categorically ruled out any role in a future Labor government.
When asked about the possibility of an official position or whether he had received any offers, Carney laughed and replied: “My time in officialdom in the UK is over.”
Carney, who led the Bank of England from 2013 to 2020, recently sparked speculation about a possible political future in the UK after formally endorsing shadow chancellor Rachel Reeves at the Labor Party conference last fall. In addition, he advises her on establishing a national wealth fund.
Despite these endorsements, Carney, the Canadian financier, has stayed away from front-line politics. In his home country, he has been suggested as a possible successor to Justin Trudeau as leader of the Liberal Party. Instead, since leaving the Bank of England, Carney has focused on coordinating global efforts to finance net zero initiatives.
At an event hosted by Deloitte at the London School of Economics, Carney called for changes to government rules to make the Bank of England and the Financial Conduct Authority (FCA) play a more active role in achieving net zero. “The powers of financial authorities, including the Bank of England and the Financial Conduct Authority (FCA), must be updated to ensure they support in a hierarchical manner the government’s net zero target,” he said.
The comments follow Chancellor Jeremy Hunt's decision last year to reduce the focus on climate change in the Bank of England's targets, a move that shadow chancellor Rachel Reeves has pledged to reverse.
Carney had a notable focus on climate change and green finance during his time at the Bank of England. However, his predecessor, Mervyn King, argued that this focus on net zero distracted the bank from its primary goal of controlling inflation.
In his speech, Carney stressed that global shocks left the UK economy 40% smaller than it would have been if it had continued to grow at the rate before the financial crisis. He noted that the UK and other countries are facing the biggest regime change in geopolitics and economic policy since the fall of the Berlin Wall.
Given these pressures and slow growth, Carney emphasized that private capital will need to lead the transition to net zero. He warned the UK against trying to match the US inflation rate, citing a lack of fiscal capacity. “Budget constraints require a targeted approach and striking the right balance. These are big judgments to make on encouraging domestic activity and lower cost solutions through imports,” he concluded.
