Treasurer Jim Chalmers has announced a review of the Reserve Bank of Australia (RBA).
The inquiry would consider areas such as structure, experience and composition of the board, RBA culture, operations and governance and accountability arrangements.
This was the first time the central bank had been reviewed since the 1990s.
Announcing the review, Chalmers said: “I’d like to build confidence in the RBA, that’s my task.
“This is not about revolutionising monetary policy in Australia. It’s about reviewing it, and then refining it and reforming it. That’s my objective.
“And I go into this review with an open mind, a genuinely open mind, about the best combination of institutional arrangements for the Reserve Bank so that we have the world’s best central bank, relying and adapting and adopting world’s best practice, learning from the past but focused on the future.”
“I don’t want it to be an exercise in potshots or second guessing. I don’t want to be it to be exclusively focused on a backward looking, blame-shifting exercise. I want it to genuinely be about ‘how do we have the world’s best central bank into the future?’”
It would be led by Professor Carolyn Wilkins, Professor Renee Fry-McKibbin and Dr Gordon de Brouwer.
Professor Wilkins was an external member of the Financial Policy Committee of the Bank of England, Professor Fry McKibbin was interim director at the Crawford School of Public Policy at the Australian National University (ANU) and De Brouwer was secretary for public sector reform.
A report was expected to be completed by March 2023.
Chalmers also announced part-time member Mark Barnaba had had his term on the RBA board extended by another year in order for him to be present during the RBA review. He had been due to depart this August after a five-year term.
Speaking at the Australian Strategic Business Forum in Melbourne, RBA Governor, Phillip Lowe, welcomed the Government’s review.
“The terms of reference are appropriate and the Government has appointed a first-class panel. The review is also welcomed by the Reserve Bank Board and the Bank’s staff,” Lowe said.
“It is an opportunity to take stock of our monetary policy arrangements and make sure that they are fit for purpose for the challenges ahead. We look forward to participating in this process and listening to and learning from others.”
