Liz Truss’s shake-up of Whitehall continues. Her Chancellor Kwasi Kwarteng has sacked Tom Scholar as permanent secretary to the Treasury – with the Cabinet Secretary to begin the recruitment process to find his successor. Announcing the news in a government press release, Scholar made clear the decision was made by Kwarteng: ‘The Chancellor decided it was time for new leadership at the Treasury, and so I will be leaving with immediate effect’.
What message does it send to the markets? There’s a risk that it suggests turbulence
The new Chancellor did at least offer some parting words of praise – describing Scholar as ‘a dedicated and exceptional civil servant’ who had provided a great service to the government and the country for the past 30 years. So, what’s behind the move? Ultimately, this fits into a wider push by Kwarteng and Truss to rally against what they view to be a Treasury orthodoxy that has been holding the government back. Scholar has come under criticism previously by inhabitants of No. 10 – he was top of a ‘sh-t list’ drawn up by former No. 10 aide Dominic Cummings of permanent secretaries viewed as problematic to the aims of Boris Johnson’s government. That Truss has done what Johnson did not shows that she is willing to put her money where her mouth is when it comes to challenging the status quo. As I write in this week’s magazine, this extends to Truss’s shake-up of No. 10 which includes a new economic unit.
Yet it is not a move without risk. First, Scholar had a lot of experience of dealing with economic crises. He played a leading role in dealing with the banking crisis of 2007 to 2009. That experience could well have proved useful when it comes to the scale of the economic challenge ahead. Second, what message does it send to the markets? There’s a risk that it suggests turbulence at a time when the government plans to borrow large sums. It follows that attention will turn to Scholar’s successor. Two names that have been doing the rounds are Antonia Romeo, currently Permanent Secretary of the Ministry of Justice, and James Bowler, Permanent Secretary of the Department for International Trade.
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