He presided over the biggest financial crisis in post-war British history and the austerity – now condemned as excessive by most economists – that followed.
But as Sir Nick Macpherson announces he is retiring from the Treasury in April, he is garlanded with rose petals. Maybe he deserves the bouquets. He has survived at the top for 10 years, at a time when permanent secretaries tend to last for shorter periods. Who knows whether Macpherson’s private advice to Gordon Brown or George Osborne has been sage? In public he defends austerity.
What we do know, however, is that the Treasury still doesn’t really know what its job is, beyond controlling total spend of the civil service. In a remarkable letter (pdf), Macpherson told Margaret Hodge, then chair of the public accounts committee, thatthe Treasury is definitely not the “corporate centre” of Whitehall. He wasn’t exactly enthusiastic about the Cabinet Office’s appointment of former BP executive John Manzoni as the first-ever chief executive of the civil service. The crisis of accountability in funding for schools and the NHS certainly indicates that Macpherson hasn’t provided the strategic financial leadership across the system called for by public accountants.
Maybe laid-back Etonians don’t do “system” – that’s also true of David Cameron. Macpherson has recently been taking seminars at King’s College London; they are mainly anecdotal and rarely address the questions raised over the years by the Commons public administration committee under both Tony Wright and Bernard Jenkin about the Bermuda Triangle between Treasury, Cabinet Office and No 10 and the absence of strategic capacity in Whitehall. You don’t readily associate Macpherson and the Treasury with the “transformation” promised by digitising government services. Cabinet Office enthusiasm can be breathless and naive, but at least there are elements of a vision for the state in 2020.
The Cabinet Office in the person of cabinet secretary and head of the civil serviceSir Jeremy Heywood now has oversight of the appointment of Macpherson’s successor, which could, in theory, mean a chance for more joining up across Whitehall.
While it could also mean an overtly ideological selection, with Cameron and Osborne insisting on “one of us” or even importing a corporate type from outside, that is improbable, because the forces of Treasury autarky are strong and favour an internal move. John Kingman or Tom Scholar could shuffle across from their second permanent secretary commands.
It’s a sign of Whitehall’s shrinkage and the Treasury’s retreat into its shell that there are no former Treasury senior staff running other Whitehall departments who might be recalled to take its top job. Minouche Shafik, now at the Bank of England, and the former permanent secretary at the Department for International Development before she went to the International Monetary Fund, comes closest to this model.
It won’t happen, but I’d like to see the position opened to a job share. How about that remarkable partnership of Robert Chote, at the Office of Budget Responsibility, and Sharon White, who moved last year from the top of the Treasury to Ofcom?
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