Australia’s government announced former Bank of England official Andrew Hauser will be the new deputy governor of the Reserve Bank, in the latest installment of a major shake-up at the institution.
Hauser, who was appointed to a five-year term as the RBA’s No. 2 official, will start his new role as soon as possible, according to a statement from Treasurer Jim Chalmers on Monday.
The move is another step by Chalmers to overhaul the RBA by installing an outsider at the central bank, which historically has promoted internally and has been criticized for being overly insular and falling into group think.
“Mr Hauser brings international expertise in macroeconomics, markets and central banking operations from his distinguished career spanning over 30 years at the Bank of England,” Chalmers said. “His appointment strikes the right balance between providing deep central banking experience and offering a fresh, global perspective.”
Hauser will be tasked with supporting Governor Michele Bullock as she takes up the challenge of implementing the 51 recommendations of an independent review of the central bank. This includes setting up a new monetary policy committee, fewer interest-rate meetings and press conferences after each decision, among other changes.
The RBA has already announced it will switch to eight meetings, down from 11 a year, beginning in February 2024.
Bullock congratulated Hauser shortly after he was announced as her new deputy governor, saying she looked forward to working with him. “He has great experience and will bring a welcome external perspective to the bank and the Reserve Bank board,” the governor said in a statement.
The RBA has delivered significant policy tightening in the past 18 months, having raised the cash rate to 4.35% from just above zero. The aggressive moves to tackle inflation have drawn criticism from some lawmakers and commentators for putting too much pressure on Australia’s highly-leveraged households.
Hauser’s appointment comes after Bullock took over as governor from Philip Lowe in mid-September. A number of senior officials have exited over the past year, in a potential doubled-edged sword for efforts to overhaul the institution.
The most recent high-profile departure is former Assistant Governor Luci Ellis who shifted to the private sector after 32 years at the RBA. The bank is yet to announce her replacement.
Others include former Head of Domestic Markets Jonathan Kearns in March after 28 years of service and ex-Deputy Governor Guy Debelle in early 2022 after 25 years.
While the departures free up positions for new people and fresh ideas, it also represents a dramatic loss of experience at a time of rapid change.
Hauser was also quoted in the RBA statement, saying he was deeply honored to have been chosen.
“I look forward to working closely with Michele Bullock, her senior team and the talented staff of the RBA to serve the Australian people, and to help make a reality of the recommendations of the RBA Review.”
(Adds RBA statement, background.)