Earning a reputation at the ECB

Date: 16/07/1998

Entre Nous may have discovered the true reason for European Central Bank President Wim Duisenberg's reluctance to reveal the size of his pay packet.

It transpires that Alan Greenspan, chairman of the US Federal Reserve for the past 11 years, earns only 130,000 ecu per year.

This may sound a lot until you compare it with the other central bank presidents whose salaries have been published: Bank of England governor Eddie George is paid a cool 345,000 ecu annually while Don Brash, who heads the Reserve Bank of New Zealand, gets 165,000 ecu.

Duisenberg is undoubtedly aware that revealing his salary would almost certainly enrage Greenspan and might lead him to demand higher wages. This in turn would provoke pay inflation in the US, push up American interest rates, boost the dollar and import inflation into the euro-11.

An alternative explanation for Duisenberg's reticence to let us into the secret of his salary - and the version being officially touted by the ECB - is that the six members of the executive board of the bank are 'contractual employees' and are therefore not public servants in the literal meaning of the term.

The bank is toying with the idea of publishing the 'global figure' for the six directors and then letting us guess who gets what.