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An economics professor and the head of a regional bank have been announced as inaugural appointments to the Reserve Bank of Australia’s new interest rate-setting board.
Australian National University professor Renee Fry-McKibbin and former Bendigo and Adelaide Bank chief executive Marnie Baker will make up the central bank’s new monetary policy board alongside four continuing RBA board members, Treasurer Jim Chalmers said on Monday.
The RBA’s board was split in two, with its rate-setting powers to be taken over by the monetary policy board, while a separate board would be responsible for running the bank, bringing it in line with international peers.
The RBA’s review comes after an independent review of the central bank’s operations criticized the current board’s decision-making and its ability to hold the governor to account.
Other measures recommended by the review have already been implemented, including regular press conferences by the governor after rate decisions and reducing the number of board meetings a year from 11 to eight.
Professor Fry-McKibbin is part of the three-person review panel and has held leadership positions in the economic and social science community, both in Australia and the UK.
Ms Baker, who was also a former deputy chairman of the Australian Banking Association, brings a deep understanding of Australia’s financial system and an important regional perspective to the role, the treasurer said.
The Coalition has called for the monetary policy board to be made up entirely of members of the current Reserve Bank board to avoid the possibility of the government stacking it with pro-Labour appointments.
After delays in getting RBA reforms through parliament, Labor finally struck a deal with the Greens after agreeing to keep the government’s power to overrule the bank’s interest rate decisions.
Former Business Council of Australia chief executive Jennifer Westacott, former Telstra chief executive David Toddy, business leader Danny Gilbert and banking executive Swati Dave are the new faces to join the board.
All members of the Reserve Bank’s current board will continue to serve on one of the two boards.
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