The Bank of England's formal independence ended with the passing of the 1946 Bank of England Act which legally acknowledged the importance of monetary affairs to government by taking the Bank into public ownership. 1 Since then, the Bank has been an integral part of the machinery of state and its policies have been those of ‘the authorities’. This is not to claim that the Bank no longer retains some independence as a source of advice to government, nor to deny that Bank governors and government ministers have not always seen eye–to–eye, even on major policy issues 2 , but in most respects Bank officials now have the same status and role in policy–making as public servants in such departments of state as the Treasury. In the last resort, it is government that is responsible for monetary policy.