We are now faced with criticism of the present system from all sections of the Staff and certain constituencies have made it abundantly clear that they would not be prepared to return a candidate to represent them on Council in any future election unless an investigation takes place.
Among other things, it has been said that –
1 The present system is too ponderous and secretive. There appears to be a lack of true negotiation.
2 The present system must be held largely responsible for the loss that has occurred in the Staff’s comparative standard of living.
3 To undertake representative duties is detrimental to an individual’s career.
The third charge was especially serious; but the following spring a detailed report by a Council sub-committee found that, in practice, ‘service on the Council is not damaging to a person’s career’ – and that indeed ‘we are convinced that in the long term no one would suffer if he or she decided to stand for the Council’. Where ultimately, however, did the whip hand lie? ‘The other day you invited our comments on the special pension offer,’ noted an August 1970 memo entitled ‘Some Views of the Council Representatives’ and sent probably to Davies. ‘We left that meeting with the feeling that it had been the first attempt by the Bank at “Management by Consultation”; it appeared to be the first occasion on which our opinions had been deliberately sought before a firm proposal had been put to us.’ And after citing two recent significant episodes in which ‘we have been faced with a virtual “fait accompli”’ and in which ‘it was clear that the Bank would not move far from their proposals’, the memo expressed the hope that ‘this first glimmer of joint consultation heralds the dawn of a new era of Staff relations’.16
Of course, the other side of stick (and limited consultation) was paternalistic carrot. Shortly before, one of the SCNI’s Labour MPs, Russell Kerr, had quizzed O’Brien:
From your remarks it would appear that, despite lack of assistance from the NUBE, a relatively happy set of industrial relations have existed over the years. To what extent would you think that has been due to what I would guess to be a fairly generous wages and salary policy as a result of the Bank having a lot of money lying around? – I do not accept the last phrase.
In the literal sense, I am sure you do not? – It is true that the Bank pay well … It has been the basis of which we have maintained the higher standards of efficiency and performance in the Bank than one would be likely to see in most other financial institutions in the City. I say this without any disrespect.
The governor also acknowledged that, in the context of the Labour government’s incomes policy, ‘the Bank staff at the present time do not feel that that differential is being anything like maintained’; but essentially, in relation to the previous quarter of a century as a whole, he was correct, albeit with a fluctuating differential in comparison to the clearing banks. In addition, pension arrangements were reasonably well safeguarded from the ravages of inflation, especially after the decision in 1966 to compensate for three-quarters, as opposed to the previous two-thirds, of the rise in the cost of living since retirement. But it was in fringe benefits that the Bank really scored. These included the Housing Loans Scheme, introduced in 1945 and limited by 1969 to three increases per person during a Bank career (in order to encourage ‘careful thought before purchasing a property’); the Educational Loans Scheme, inaugurated in 1957 and disbursing loans over the next fifteen years of nearly £700,000, enabling some 800 children of Bank employees to be privately educated; the handsomely equipped and maintained Sports Club at Roehampton; and active support for a range of officially encouraged extra-curricular activities.17
‘Ladies of Threadneedle Street Are Right on Their Toes’ reported the Evening News in February 1956:
When work is over at the Bank of England on Wednesday evenings a group of 20 young girls meet at the Bank Club in Tokenhouse Yard. They go by lift to the third floor and into an improvised dressing-room to change. When they emerge they have all the radiance of a ballet chorus. This is their dancing night. The Bank provides professional tuition for them.
They appear at Bank concerts and are rehearsing for a revue which is to be presented in April. Senior girl of the troupe is 24-year-old Paddy Salter of Harrow. ‘I would have taken up dancing seriously but for the war,’ she said. ‘I joined the Bank instead and now I derive all the enjoyment from dancing as well as having a good job.’
Just around the corner from Tokenhouse Yard, in King’s Arms Yard, there was from 1962 a wholly new, purpose-built staff club, which included the now modernised Tokenhouse Yard premises and on any one day could provide over 2,200 subsidised lunches as well as other facilities. ‘Each day,’ recalled Willie Osborn in 2000, ‘there was a ritual in the Chief Cashier’s Office’:
I refer to the distribution of Tea Tickets which took place around eleven o’clock. One of the ‘girls’ from Counter, which also served as Staff Post, would come round the office with the largest-size bulldog clip bursting with blue Tea Tickets. ‘How many would you like?’ she would ask. The innocent would whimper that one would suffice, but the cognoscenti would bid for six or more; and a handful – not necessarily counted out – would be duly handed over.
A Tea Ticket was a sort of luncheon voucher that entitled the bearer to a variety of goodies available during the tea break over in the Bank of England Club. Appropriately the goodies included Jacobs Club biscuits, Penguins, more boring specimens like digestive and rich tea biscuits and – the ultimate gourmet experience – poached egg on toast. The value of a Tea Ticket must have changed over the years but I seem to remember it as about 1s 6d. Up to two Tea Tickets could be exchanged in any one transaction but, as there were three floors serving teas in the Club in those days, the bold would visit all three floors and cash in six a day. Why go to Sainsburys to stock up the biscuit tin when you could do it at the Club?
Paternalism took many forms, including ‘Sunny Offs’, introduced by O’Brien as governor towards the end of a long, cold summer. ‘He decided that provided the sun shone, and only then, staff who could be spared should be given an afternoon off, in turns,’ remembered Dorothy Binns. ‘This was presumably to build up our strength for the coming winter.’ Accordingly, ‘around 12 o’clock, the principal would personally decide whether or not the sun was shining, and word would go round as to whether the selected few would get their Offs or not’. And unsurprisingly, ‘one had been glancing out of the window occasionally with more than casual interest from 11.30 am onwards’.
Intrinsic to paternalism was the fundamental fact that only a tiny proportion of the staff – say two dozen out of a total banking staff of well over 4,000 – had a major decision-making role to play. This meant that the day-to-day work for the overwhelming majority was essentially routine, largely repetitive and often boring. ‘Desperately dull’ was how de Moubray in the early 1950s found work in the Drawing Office, with it being no more enthralling (‘deadly dull, processing exchange control applications’) when he moved on to the Securities Control Office.18 Yet, if much of the work was tedious, not only did the deliberately powerful element of benevolent if strict paternalism help to ensure a generally strong sense of esprit de corps, but there still existed many old-style Bank ‘characters’ to help enliven the atmosphere – arguably the last generation of such characters, before computers replaced clerical grind and the management consultants and the ‘study group’ arrived in numbers.
A trio of reminiscences gives us a final glimpse of the pre-1970 Bank, not so unfamiliar to the pen-pushers of a century or even two centuries before. Michael Pickering, joining the Bank in 1947, was settled by the early 1950s in the Consols Office – that part of it called the Balance Section, where the changes in stockholders’ details were recorded on ‘balance slips’:
Winstanley [a principal] subsisted mainly on gin and chocolate buns, both of which he consumed in the office. He had a habit – which caused at least one nervous breakdown on the passing section – of stan
ding over people and snorting as they worked; indeed, it wasn’t until I encountered him that I realised that people actually did say ‘Pshaw!’ Sometimes he would bellow a comment, and shouted ‘That witness won’t do!’ and jabbed an indignant forefinger at the transfer under scrutiny. He was once holding a chocolate bun in his hand and the wretched passer had to spend 35 minutes scraping the transfer clean before it could be returned whence it came for the error to be corrected.
There were two first-class clerks called Doak and Pendleton; both were very tall and thin, both had lugubrious countenances, both were susceptible to draughts, and both hated each other. One afternoon they had a furious row about the positioning of a draught screen and Winstanley looked up from his desk to observe them engaged in a frenzied tug-of-war. He leapt into action. ‘All right, Pendleton,’ he yelled. ‘If you want the draught screen, you have it!’ Whereupon he seized the screen, which was of the flexible sort, wrapped it round Pendleton and secured it with tape, thus obliging his subordinate to stand rigidly to attention for the rest of the afternoon like a bemused umbrella stand.
The superintendent of the passing section was Cruickshank. He had white hair and a petulant face and didn’t like people. He reserved an especial venom for a perfectly harmless first-class clerk called Budgin and persisted in telling him he smelt; the fact that none of the rest of us noticed anything made no difference to Cruickshank, who, if he was in a more than usually foul mood, would make Budgin sit outside on the window-sill dangling his legs over Finsbury Circus …
Christopher Bell towards the end of the 1950s was likewise on the Balance Section, by now located in New Change. There, he encountered ‘many men talented in directions far removed from central banking’:
One such, a very dapper old Harrovian, was heavily involved with racing, and I particularly recall a quiet and scholarly man whose daily task was of a mind-numbing routine nature, but who devoted his time – and part of his working day – attempting to prove that Bacon wrote Shakespeare … Some, of course, merely took solace in more down-to-earth pursuits such as worshipping at the shrine of Bacchus. One man on an adjacent Section would arise from his desk at 11.30 every morning and announce, in stentorian tones, ‘Off to the Halls of Mirth!’ It was some time before I discovered that ‘The Halls of Mirth’ were synonymous with ‘Ye Olde Watney’, a famous hostelry just a hundred yards or so from the office door and the venue for his morning ‘coffee’ break.
Also to be found on the Balance Section at that time was an aged First Class Clerk who was inclined to fall asleep at his desk after lunch. His spectacles would invariably slip from his nose and remain dangling from one ear. A little later, the Superintendent would return from his lunch and be confronted by this sight. The balance slips were stored in metal boxes, each about the length of two shoe boxes, with heavy metal lids. It was the sleeper’s misfortune to have his desk situated close to some of those boxes. And so, inevitably, the Superintendent, on his return, would lift the lid of the nearest box and drop it forcefully. The effect on the sleeper was, of course, dramatic, and the same routine was played out regularly. All very entertaining to the young and impressionable onlookers …
As for Threadneedle Street itself, the recollections come from Paul Tempest, a member by 1962 of the Overseas Department, comprising about a dozen groups of four to eight men (each with an adviser and an assistant) and situated in a ‘long, low side-lit room on the Third Floor overlooking Bartholomew Lane’:
The office was supervised by an elderly superintendent who sat in a glassed-off ‘case’, gazing gloomily down the long strip of carpet, looking for any sign of disorder. He was flanked by one or two girls plucked regularly for their promise or aspiration from the filing room upstairs or the typing pool downstairs … Women were, however, in short enough supply for the call ‘Murphy’s (or Mitchell’s) balance’ to be still in widespread use throughout the office. This century-old Bank traditional signal – more subtle than the paper dart – attracting general attention to a likely pair of legs or other part of a passing anatomy without giving offence had its own particular variant in Overseas where Group One would call out ‘Zwei millionen’, to be agreed less coarsely by a francophone ‘Trente-huit, vingt-deux …’, the Kremlin would chirrup ‘Niet, niet, niet’ to the alert of the Arabs or the Hispanics, as the visitor passed by them down the full length of the carpet …
Humour in Overseas was, in that large open room, more often than not, pure Theatre. For the captive audience, the action unrolled constantly before them down that long central strip of carpet. Initiation horse-play took several forms. A favourite was, once everyone had been alerted, to ring up the newcomer on his first morning from several desks’ distance. The voice was made to sound immensely old, senior and Governor-like. ‘Is that you, Jones? Welcome to Overseas. Would you care to come in, please?’ The speaker’s receiver would be put down sharply, with a crisp clip. At the other end, Jones would generally spring to his feet before realising that he had not the slightest idea where to go or who had spoken to him …19
Probably the sternest internal critic in the late 1960s of the Bank’s organisation was James Selwyn, justifiably disappointed in 1965 not to become head of the newly created Economic Intelligence Department and by now an adviser to the governors. ‘Labour in the Bank’ was the title of his January 1968 memo for O’Brien, arguing that in four main ways the Bank was ‘inefficient’ in its use of human resources:
(i) Small volume of output resulting chiefly from frequent breaks (coffee, lunch and tea) and a leisurely attitude when on the job.
(ii) Work being done by people of higher calibre than necessary.
(iii) Work which serves little useful purpose; i.e. contributes little to the fulfilment of the Bank’s operations.
(iv) Increased work and/or hindrance to the smooth flow of work because of unsuitable organisation (e.g. inadequate decentralisation of authority).
The upshot, influenced partly also by the desire for cover against potential criticism from the SCNI, was the appointment later in 1968 of the American management consultants McKinsey & Co. The serious investigative work began in February 1969. ‘I think it would be right to offer them some limited lunching facilities on the 4th Floor,’ Fforde informed a colleague earlier that month about the two members of the six-man team who were partners in the firm. ‘I will therefore tell them we would be pleased to see them at lunch from time to time and will add, tactfully, that we would not expect them to lunch with us every day they are working in the Bank.’
In the event, although the key recommendation by McKinsey – involving much enhanced executive responsibilities for the so-called executive directors, thereby reducing the power of the chief cashier and departmental heads – was blocked by O’Brien at an early stage, some other recommendations fared better. These led early in the new decade to various changes, of which probably the most important were the creation of a Management Services Department charged with providing computer and general managerial services; the appointment of a financial controller to ensure budgetary control; the start of a separate research division, the Economic Section, in the EID; and the initiation of a Management Development Division with a view to enhancing performance appraisal, career planning and management training. In the round, though, it was far from a revolution. ‘McKinsey’s general conclusion is that the quality of the Bank’s work and the calibre of the Staff is high,’ reflected the Bank itself in January 1970, while soon afterwards a press comment was that McKinsey’s had ‘discovered some rusty or obsolescent machinery, but no actual corpses buried in the courtyard’.20 Even so, management-speak had now arrived at the Bank, and there could be no going back.
Undeniably, the Bank during the 1970s as a whole became a significantly more modern institution. The lengthy postal strike of early 1971 may have temporarily led to stockholders or their agents once again personally collecting the dividend warrants, but the general direction of travel was emphatically towards the future, not the past. Tha
t same year saw not only the end of the Governor’s Charge but the opening of the handsome Reference Library three floors below ground level, and in 1973 the time-honoured Bank Picquet was finally put at ease. Graduate recruitment doubled between the early and mid-1970s; increasingly, in the not altogether gruntled words of John Hill, the Bank looked ‘to recruit staff who had been taught the new maths and/or computer studies’, meaning that ‘the place would never be the same again’; and across much of the Bank, what were known as Clerical Work Measurement (CWM) systems were installed, with those carrying clipboards and stopwatches nicknamed only quasi-affectionately as ‘Gerry and the Pacemakers’. That pace of change, though, can be exaggerated. Management as a whole was still relatively unsophisticated, with Eddie George, in the context of his 1975 review of the EID, referring to ‘matrix management’ as ‘apparently quite common’ in the outside world; Anne Skinner, from 1974 a junior manager in the Accountant’s Department, would recall resistance among men to working for a woman (‘trying to cut you out, not telling you what the job involved’); through the decade, a battle for control of staff continued to be waged between Establishments and the other departments; and in 1977 the recruitment at an unusually senior level of David Walker from the Treasury involved the governor eventually overcoming stiff, outspoken resistance from the chief cashier and some of the chiefs of departments, with John Page insistent to the end that ‘the Bank is not that sort of place’.21
The Bank’s own finances entered a new era in the 1970s. Published annual accounts, the Treasury scrutinising the Bank’s efficiency, profits largely going to the Treasury – all these flowed directly from the SCNI’s 1970 report, while from McKinsey’s came much tighter budgetary control. A by-product of the new arrangements were moments of distinct Bank/Treasury tetchiness, including at one point some seven or eight months when Richardson as governor simply ignored a formal request from Wass at the Treasury to be informed of the exact details and extent of the Bank’s operations in relation to the Lifeboat and other support initiatives, prompting Christopher Dow to reflect that ‘no doubt the central bank has to be left a large discretion’, but ‘it would have cost us nothing to have made a show of telling the Treasury the essentials’. A further source of potential tension were those quite frequent phases during which the Bank, being in the public sector, was expected by government to moderate pay settlements, even as the Bank sought to ensure that its pay levels were kept competitive with those of the clearing banks. ‘We had always paid, and would continue to pay, full regard to official policy but the fundamental position was that we had authority under the Bank Act to run our own affairs,’ recorded the note of O’Brien’s ‘very plain’ speaking to a Treasury mandarin in March 1971. ‘It seemed that civil servants concerned with incomes policy felt that they could dictate the entire detail of our negotiations with the staff. The Governor was not prepared to accept this for a moment.’22
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