risk on the largest payments flows – the ones most likely to threaten financial stability by bringing down the system if they failed. but that is not the only innovation that rtgs has delivered over the years. as the financial system has evolved, rtgs has been regularly updated, introducing a raft of new functions and risk mitigants to respond to changing demands. today, we are announcing that the bank has completed, or agreed steps that will complete, all the actions in response to the deloitte report 4 published in march last year following the rtgs outage in october 2014. looking forward, as we celebrate rtgs ’ twentieth birthday during 2016, it is again time to ask fundamental questions about the shape of the bank ’ s settlement operations. the way payments are made has changed dramatically in recent years, reflecting changes in the needs of households and companies, changes in technology, and an evolving regulatory landscape. the range of payment providers is growing rapidly. given the implications of these changes for the bank ’ s mission and for users, businesses and regulators, it is important that the bank consider how rtgs will need to evolve to meet and shape payments trends in the coming decades. that is why we are today announcing our plan to design a blueprint for a new heart that can support the future demands placed on the uk ’ s high - value sterling settlement system. in my remaining remarks tonight i want to do three things. first, set out some of the key drivers of change. second, explain some of the strategic questions we want to ask on the future role of rtgs. and, third, set out how we will go about developing a blueprint for a new high value payments system. either directly in the case of high - value payments made via chaps, or indirectly after netting in the case of retail payments made via the various private sector schemes. the deloitte report on the october 2014 rtgs outage can be found here : http : / / www. bankofengland. co. uk / publications / documents / news / 2015 / rtgsdeloitte. pdf. an update on the completion of the recommendations of the deloitte report can be found here : http : / / www. bankofengland. co. uk / markets / documents / paymentsystems / deliotteactions. pdf. bis central bankers ’ speeches evolution in the payments landscape much has changed in the uk payments landscape in the past twenty years. in particular, i want

mr george talks about monetary policy in the united kingdom : the economic prospect text of the chancellor ’ s lecture delivered by the governor of the bank of england, mr e a j george, at hertfordshire university on 18 / 02 / 99. as you would expect of a central banker i will talk about monetary policy – under the title of “ the economic prospect ”. i will begin by explaining what it is that we are trying to do through monetary policy ; then i ’ ll describe how we ’ ve been doing, where we are now, and where we might be headed. what we are trying to do so let me begin with what it is that we are trying to do. in one sense that ’ s very easy to explain these days. the previous conservative government had already in 1992 defined the objective of monetary policy in terms of a target rate for retail price inflation. the new labour government, immediately on assuming office, similarly defined the objective in terms of an inflation target, but went an important step further. as soon as gordon brown became chancellor of the exchequer, in may 1997, he announced that he would no longer exercise his powers to set short - term interest rates, which is the heart of monetary policy, but instead he would set the inflation target, and delegate the achievement of that target to a new monetary policy committee to be established in the bank of england. this position was subsequently formalised in the new bank of england act which came into effect in june of last year. that act now defines the bank ’ s objective as “ the maintenance of price stability, and, subject to that, to support the government ’ s economic policy, including its objectives for growth and employment ”. under the act the chancellor tells the bank what precisely we are to understand by “ price stability ” and he has done this by setting a target of 2½ % for a particular measure of retail price inflation ( rpix – which is the rpi excluding mortgage interest payments ) ; and although the act provides for the chancellor to set the target each year, the expectation is that it is in practice set for the medium to longer term. that is the political decision. the task of achieving that target – the technical implementation of monetary policy – is then delegated, transparently and accountably, to the mpc. the government no longer has the power – as it had under the 1946 bank of england act – to issue directions to the bank in the field of monetary policy, except, in the terms of the new