On 22 January 2024, there was published on legislation.gov.uk a draft of the Bank of England Levy (Amount of Levy Payable) Regulations 2024.

Schedule 2ZA to the Bank of England Act 1998 makes provision for the Bank of England (BoE) to impose a charge, known as the BoE levy (levy) on eligible institutions to fund its policy functions in relation to a levy year.

The draft statutory instrument (SI) makes provision for which eligible institutions will be liable to pay the levy in respect of a levy year, and the proportion of the levy that each institution will pay be reference to their average eligible liability base. The draft SI also provides the calculation that the BoE must use when determining the amount of the levy that an eligible institution is required to pay for a levy year, and how the total levy will be shared between institutions who are required to pay. The draft SI also makes provision for discretions the BoE can use and for the information and liabilities that will be relevant.

Eligible institutions with eligible liabilities up to and including £600 million will not be required to pay the levy. Eligible institutions with eligible liabilities greater than £600 million will be required to contribute to the levy in proportion to the size of their eligible liabilities. This replaces the requirement to make deposits under the Cash Ration Deposits Scheme for such institutions.   

The Government will continue to monitor the effectiveness of the funding model used for meeting the BoE’s policy costs. Once the draft SI is finalised the Government will conduct a formal review that will be published before the end of the five-year period beginning on 1 March 2024. The BoE will remain subject to National Audit Objectives, and a statutory review clause is included in the draft statutory instrument.