Why is the Treasury not always treasured?
“All Treasuries, if they are to do good service by the masters, are generally hated”: James I / VI.
Iain Duncan Smith’s broadside against the Treasury last week sounded all too familiar.
Take his statement that “I think it has to be broken up; I have reached that conclusion. The worst thing we have in Britain is the Treasury.”
Breaking up the Treasury is a common call from those who fall foul of the department’s control. Indeed this was also tried when Harold Wilson introduced the Department of Economic Affairs alongside it.
The experiment was short lived and the Treasury is still one of the few joint economic and finance ministries, certainly in Europe. Yet this is also one of its strengths, given the connection between micro and macro policies and the speed with which decisions and actions need to be taken – the financial crisis showed that.
IDS also criticised the dominance of the department, saying that “The culture of the Treasury is almost unique in the western world; that a country’s government is so dominated by one organisation.”
The culture point is true – it is certainly unique – and it does dominate the decision making process. But is this necessarily a bad thing? With his or her Finance ministry hat on, much of a Treasury official’s job is to say no. Often if the policy is logical and evidence-based, the money will get released.
Most people who don’t like the Treasury are the ones who have had it say no to them. It is, after all, the job of the department to look after the country’s money and ensure its economic safety. It’s a big job to be done by only 1000 people, which makes it one of the smallest departments in Whitehall. Its size means it has to be flexible while doing a crucial job – teams often get put together at short notice to deal with an arising crisis or newly announced policy.
Which is why, often, the people who work there love it. The flexibility, allied to the responsibility, often given at a young age – IDS correctly noted how young its officials are – does make for a unique culture. Yes, there is a certain element of power that comes with it but it is a sink or swim environment, signified by one of its mantras: “challenge and be challenged”.
The Treasury is used to not being loved and it’s also used to having brickbats thrown at it. Some such criticisms are valid – current economic growth, or perhaps lack of any, being one, though it is doubtful whether a smaller/fragmented Treasury or another department could do much about that either. And perhaps some of the policies it introduces itself could be more obviously evidence based. But it’s survived for over 400 years for a reason; it has an important job to do, which it does very well, and its culture is an important part of its achievements.
Image courtesy of A View on Cities