Top Treasury Mandarin is SACKED by Chancellor Kwasi Kwarteng as new Truss government acts against ‘orthodox’ economic figures as it prepares to try to ease damage of coast-of-living crisis

  • Sir Tom Scholar was removed by Chancellor Kwasi Kwarteng last week 
  • New PM Liz Truss has previously railed against ‘Treasury orthodoxy’ 
  • Lord Butler, who served under Margaret Thatcher, said move was ‘very unusual’ 

The top civil servant at the Treasury has been sacked by the new Liz Truss government. 

Sir Tom Scholar was removed by Chancellor Kwasi Kwarteng in one of his first acts on taking office last week.

Ms Truss has previously railed against ‘Treasury orthodoxy’ and the decision to get rid of Sir Tom, on the first day of her new Government, was seen as a signal of her determination to change the direction of economic policy. 

But the decision, coming as ministers grapple with how to see off a winter of discontent amid soaring inflation and bills, has been criticised.  

Lord Butler, who served as cabinet secretary under Margaret Thatcher, Sir John Major and Sir Tony Blair, warned the actions of the new administration could ‘corrupt’ the system of government.

The peer strongly condemned the sacking saying it was ‘very unusual and very regrettable’.

‘If there was ever a time we needed experience and continuity, which is what the Civil Service provides, it is now,’ he told BBC Radio 4’s The World This Weekend.

‘We have a new sovereign, we have a new Prime Minister and we really need the cement that can hold this system together.

Sir Tom Scholar was removed by Chancellor Kwasi Kwarteng in one of his first acts on taking office last week.

Ms Truss has previously railed against ‘Treasury orthodoxy’ and the decision by the Chancellor  to get rid of Sir Tom, on the first day of her new Government, was seen as a signal of her determination to change the direction of economic policy.

Lord Butler, who served as cabinet secretary under Margaret Thatcher, Sir John Major and Sir Tony Blair, warned the actions of the new administration could ‘corrupt’ the system of government.

‘I think the politicians are beginning to forget the constitution. The Civil Service is Her Majesty’s Civil Service. A government wouldn’t come in and on the first day sack the head of Her Majesty’s defence forces, the chief of the defence staff.

‘I think they are behaving improperly towards the Civil Service. It will weaken them but it will also corrupt our system because one of those great advantages of having an independent, loyal Civil Service will be compromised.

Sir Tom Scholar, who has worked in the Civil Service for three decades, said he would be cheering the department on ‘from the sidelines’ following his departure as permanent secretary.

In the meantime, Beth Russell, director general of tax and welfare, and Cat Little, director general of public spending, will lead the department as acting permanent secretaries.

Mr Kwarteng said Sir Tom had helped steer the Treasury and Government through ‘many economic challenges’ – from the financial crisis to the Covid-19 pandemic, and he leaves the Civil Service with ‘the highest distinction’.

Lord Butler’s  comments were echoed by his successor as cabinet secretary, Lord O’Donnell, who told Times Radio: ‘She needs to respect the Civil Service and public servants everywhere and treat them with respect.

‘And to be honest, the start, with the sacking of Tom Scholar, hasn’t been as respectful as one would like.

‘If you’re going to succeed as a Prime Minister, you have to have the Civil Service with you. They are keen to serve the democratically elected politicians of the country. But the respect should go both ways.

‘She needs to understand that sacking someone with no notice for no apparent reason, someone held in high regard by chancellors of all political parties, is is no way to earn the respect of the Treasury and the Civil Service, I’m afraid.’

However, Lord Butler argued that Mrs Thatcher had entered No 10 similarly bent on change but had not felt the need to get rid of the senior officials involved.

‘The permanent secretary of the Treasury stayed on and provided continuity. That didn’t stop the Thatcher government changing the direction of economic policy.’

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