The big idea: should we abolish the Treasury?

Stian Westlake – The Guardian

Stian Westlake asks an important question, gives the clearly correct answer, but curiously shys away from facing up to the reasons why the Treasury should indeed be done away with.

He lists a whole set of reasons why the Treasury is detrimental to good government, but rounds off his account of the systematic damage it does by asserting that:

The first step to addressing these problems is to recognise that they are not the result of a failing institution or of lazy or incompetent officials

They are certainly not the result of laziness or of incompetence in a narrow sense. But they are precisely the result of Treasury being a failing institution. That’s clearly not true in the delivery of its daily activities: the work gets done, decisions are made, budgets are delivered, smart people are employed. But in a more important sense – the sense that Stian is quite rightly concerned about – it is.

There is huge talent and energy in the Treasury. But it operates in a culture which results in its doing at least as much harm as good. Of course the functions it performs need to be done in any government, but as Stian demonstrates, they certainly don’t need to be done in their current organisational configuration. And it is precisely because they do need to be done that we can see that it is the organisational configuration which is the problem.

Indeed, Stian goes on to make that very point:

The root cause is the structure of the organisation, and the incentives and culture that it fosters.

That sounds to me pretty much the definition of a failing organisation. But I labour the point not to split hairs, but because I think it strengthens the argument in the article. The reforms suggested would arguably be disproportionate as a solution to mild problems in a benign organisation. But if the problems are severe, creating a threat to the effectiveness of any government, the solutions must be proportionately radical to have any chance of success.

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