Guest blog: What has the Treasury ever done for us?

Certainly anyone who has worked in a spending department will be sympathetic to the sentiment underlying this question. There is an active debate in Whitehall right now about the extent to which departmental finance teams will fall in underneath the new group finance function created in the Treasury. There has already been a lot of foot-dragging on this issue and Labour is even said to be considering a move in the opposite direction, a break-up of the Treasury, changing its central role in government and giving some of its functions to the Department for Business, Innovation and Skills. I used to be the Director of Strategy in BIS and might have welcomed such a move when I was there. On the whole though, I think the Treasury stands up well against the criticisms made of it and weakening it would be a big mistake. Here is why: 1. Searing criticism delivered from a height is a good thing to have in a government system. Too often the Civil Service lacks both deep subject matter expertise and top drawer professional skills. Most civil servants, even the best ones, have neither. Just to be clear, I have neither too and I was two over-promotions away from running an entire department when I left on a career break last September. Yes, it's terrifying. People move around too often, not least because promotion typically is gained by moving rather than becoming expert in the same role. And the cult of the amateur, with marginal exceptions, still reigns. In this context, a muscular spending control function that starts by being sceptical about everything is essential. The toughest examinations I ever had of my policy advice as a civil servant came from Treasury officials not from people on my own side. Once through these examinations, the most committed and authoritative support came from them too. If we want higher-quality government then the Treasury helps. 2. Spending departments are short-termist. Ministers don't stick around for long. Neither do senior officials. If we think British industry is bedevilled by short-termism, then we should despair that the average tenure of a permanent secretary is significantly shorter than a FTSE100 chief executive. While Treasury-led spending reviews only cover three years at best and their outcomes are adjusted at fiscal events, they’re still the best in class. Incidentally, the present First Permanent Secretary at the Treasury, Nick Macpherson, has been there longer than any of his peers in spending departments. If we think the Civil Service should do something to speak for the long term public interest then we need the Treasury to lead it. 3. Culture matters. Most spending departments are cut and recut in a dozen different ways during an average civil service career. Each change brings a different definition of the mission of the department and the skills and values at the heart of it. The Treasury by comparison has been remarkably stable as an institutional form. If we think wisdom lives in places then a strong Treasury is where to nurture it. 4. Government needs more integration not less. One of the major complaints about the Treasury is more a criticism of fiscal events where lots of different policy issues are crunched through at the same time rather than one by one. Frankly, we need more moments like this in government. 23 spending departments, over a hundred ministers, thousands of bodies that publish separate accounts - it would be terrifying if we worked through them one by one. Spending commitments would stack up. There would be no trading off of spending plans and objectives. If we want government to prioritise then we need the Treasury to run the Budget process every year (and realistically one fiscal event per year isn't enough in a complex economy and welfare state, so we need the Autumn Statement too). None of this is to say that the Treasury never makes mistakes. Of course it does. And its mistakes are highly public. All the better. Plus sometimes it does behave like a spending department, inventing policy commitments without adequate evidence and providing insufficiently impartial advice to Ministers but when it does so it merely displays the same pathology as the rest of the system. It would be best if we let the Treasury be the Treasury. Weakening its role in what is already a highly federated and inexpert system would be a mistake.