@GeofCox one gem in the Guardian article that stand out to me:
"“Five years ago, the Bank of England held nearly 35% of gilts,” says Gabor. “Since 2022, the Bank has been a net seller. It is unique in the way it has done this, selling bonds before they mature rather than waiting for the government to pay its debts on expiry.”
Often, these bonds are worth much less than they were originally bought for.
Meanwhile, an Osborne-era agreement between the Treasury and the Bank means the UK government is liable for losses made by the Bank on bonds.
The US Federal Reserve and the European Central Bank simply record these losses on the central bank’s balance sheet, to be paid down by future profit.
The New Economics Foundation suggests moving to this system could free up to £26bn a year for the Treasury."
Note also that by selling gilts the BoE forces down the market price of gilts and so increases the effective interest rate (gilts don't typically tradel at their coupon rate).
This is not to mention that we pay market interest rates on all money the Banks are shown as holding on deposit with the BOE (money we gifted to them through QE to shore them up after the 2008 crash). No other European government pays interest on all their corresponding deposits.
But, of course, the Bank of England is "independent" (so the Government, ie then Chancellor of the Exchequer Gordon Brown, decided in 1998), hence the government says it cant control the BoE and its functionaries can apply whatever bat-shit logic they like to monetary policy.