The next Prime Minister needs a Chancellor who will defy the Treasury factory of Remain

The next Prime Minister needs a Chancellor who will defy the Treasury factory of Remain

Brexiteers see it as a factory of Remain – spewing anti-Brexit bile from the midst of Government – and in dire need of change. Like a Bram Stoker villain but with less dynamism, the Chancellor Philip Hammond has drawn strength from his department in his plot to weaken and frustrate Brexit – his apparatchiks, the most Remain-inclined of all the Civil Service, have been tasked with taking the wind out of Britain’s biggest democratic vote as they fire out reports trashing the benefits of leaving.

It’s hard to know whether Brexit-backing economists are more united over their desire to leave the EU or their visceral dislike of HM Treasury. One former Boris Johnson aide is known to hate it so much, they want a complete overhaul of the department. So when the new Prime Minister sweeps into Downing Street, (let’s assume for argument’s sake that it’s Boris) his most crucial choice is who will be tasked with holding the purse-strings of the state.

The Times reckons Sajid Javid was offered the role of Chancellor by Mr. Johnson if he had just pulled out and endorsed the frontrunner. The economics student and son of Pakistani parents entered politics after a glittering financial career and a job as a managing director at Deutsche Bank. However his two ministerial jobs before entering the Cabinet – in George Osborne’s Treasury – could be seen to taint his eurosceptic credentials, especially as he backed Remain.

But could ‘The Saj’ maintain friendly terms with his old leadership rival? If Tony Blair taught us anything, it’s how important the relationship is between Nos. 10 and 11 Downing Street. Jacob Rees-Mogg, who supported Boris’s campaign long before his ERG colleagues did, seems to work well with the future PM. Could the Jeeves and Wooster duo replicate the close relationship enjoyed by Cameron and Osborne? Rees-Mogg has a track record of euroscepticism and a keen interest in finance –  when he was 12-years-old he famously voted at the General Electric Company AGM against what he saw as a pathetically small dividend from his shares. The old Etonian then set up his own investment company, Somerset Capital Management, and today he pulls no punches in his view of the Government department he calls “the beating heart of Remain”.

Bet perhaps Boris needs an insider to rid the system of its declinism. The darling of the Thatcherites Liz Truss pumps out libertarian memes on social media and is by far Instagram’s best known Chief Secretary to the Treasury. In March she said she “[didn’t] believe the plague of locusts stuff” about leaving on WTO terms, and called on Theresa May to leave without a deal rather than extending Article 50. But as the deputy of a department she would be tasked with reforming, she could easily be tainted by her relationship with the old regime. In the referendum Truss voted Remain and stayed put in Government when Boris and David Davis resigned over Brexit.

It’s possible the new PM could be really radical and appoint somebody like Steve Baker to the role. Commentators have tipped the ERG organiser and Brexit ‘Spartan’ as a possible Brexit Secretary to send a clear message that Britain is serious about leaving the EU. But since the Treasury wields so much power over all of government, making Mr. Baker the Chancellor would be a clearer sign of a break from the anti-Brexit Eeyore years. A member of the Treasury Select Committee, Baker would also be a reforming Chancellor for a Britain after Brexit is delivered. From working as a software engineer in the heart of several investment banks and regulators, the ERG vice chair claims many within the financial sector don’t understand their own business. He’s utterly scathing about the current system of global finance and what he sees as the problems of Keynesian easy money. For a strong political signal towards Brexit with a Chancellor keen to reshape the global financial order, Steve Baker would be a good pick.

But whoever is chosen, the new appointee must be resolute in reforming an institution staffed with mandarins resistant to change. In 1981 Norman Straus’s Number 10 Policy Unit paper concluded that within the top echelons of the civil service:

“qualities of obedience, caution, don’t make trouble, observe precedent… are the definitive disqualifications for being able to reform the systems and handle a period of turbulent national change.”

This has been widely observed. If whoever is Chancellor can’t get a grasp on the most critical department, a general election might be necessary with the Brexit Party calling the shots. Brexit Party MEP John Longworth, the former head of the British Chambers of Commerce, once told me in a podcast that the top few tiers of officials in the Civil Service should be replaced with political appointees to prevent an institutional bias towards Remain. If the Tories don’t take the Treasury seriously, Mr. Longworth might be in a position to get his wish.