Is the Bank's independence under threat?

Over at his blog, Robert Peston sees the independence of the Bank of England being eroded as the recession progresses. Basically, the worry is that once the Bank embarks on quantitative easing the Treasury will have to steer monetary policy in order to safeguard taxpayers’ cash. Here’s a sizeable excerpt from Peston’s rather more detailed explanation:

“Perhaps the important point is that Mervyn King and the chancellor have both made clear that it won’t be long before the Bank of England starts to use money, rather then Treasury bills, to buy corporate debt and other financial assets. At that point, even the governor would call that monetary policy.

It would be the moment when – for the purists – quantitative easing would begin (you knew I’d break my word not to use this ghastly expression). To reiterate, the Bank of England would start to buy financial assets – low-risk government bonds and higher risk corporate debt – from banks and for money