The Globe and Mail reports in its Thursday edition that independent Senator Diane Bellemare of Quebec has introduced in the Senate a bill that would dramatically overhaul the Bank of Canada Act. The Globe's David Parkinson writes that the legislation entered second reading this week. Ms. Bellemare proposes that the power to make interest-rate decisions be taken out of the hands of the bank's Governing Council and entrusted to a new body dominated by independent experts from outside the bank. The bill also seeks to entrench a dual mandate of both inflation control and "full employment" in the legislation. Mr. Parkinson says the bill is an extreme long shot to ever become law. It could, however, provide a starting point for a healthy conversation about the role of monetary policy in guiding the national economy. It is not a terrible idea to ask if there are better ways to do what the BOC has been trying to do. Ms. Bellemare argues that Canada needs "a co-ordination of policy tools" to meet the conflicting economic challenges that we face. She adds, "This is a way to start engineering our fiscal and monetary policy a bit differently, without having the risk of monetary policy being considered politically oriented."
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