The PM intends to reduce the department’s stranglehold on the public purse. This involves bringing long-term thinking to economic policy.
Andy Burnham’s far from the 1st prime minister to dream of taming the power of the mighty Treasury.
Boris Johnson all but compelled the resignation of Sajid Javid by handpicking his team; Margaret Thatcher favoured her economic adviser, Alan Walters, over Nigel Lawson. This prompted the latter’s furious resignation. The power struggle between Tony Blair and Gordon Brown has become legendary in Whitehall.
Burnham’s approach harks further back still to Labour prime minister Harold Wilson’s Department of Economic Affairs (DEA). It was a short-lived attempt to bring long-term thinking to British economic policymaking.
The PM made the historical analogy as he gave fresh details this week of his plan to take control of growth policy from the Treasury to hand it over to a new No. 10 department in Manchester.
The DEA was entrusted the responsibility for drawing up a national plan for the economy, which began with the timeless exhortation. He asserted that the UK must pay its way in the world to produce more wealth inside the country.
The baleful influence of the Treasury has been moving with a stranglehold over public finances. This has been long lamented by left-wingers. They accuse it of short-term thinking with ingrained, institutional caution.
Burnham told the Times that the dual job of growth as well as control of public finances sometimes clouds the growth mission. So having No. 10 leading on that growth mission may mean that one benefits by moving with maximum power to unlock the blockages where they exist in the Whitehall system.
Some of the most criticised decisions of Keir Starmer’s tenure were seen by many Labour MPs as resulting from this Treasury brain. From slashing the winter fuel allowance to caving into city lobbying on a bank of a windfall tax were some issues cited.
