Policy Unstuck with Ewan McGowan, former Head of Trade Defence and Economic Crime Reform at HM Treasury. Interviewed, edited and titled by Tom Hashemi.

I’d hazard a guess that the average age is around 30 in the Treasury, with a significant portion of the hard yards of policy work done by junior officials relatively fresh out of university. Treasury officials are among the worst paid in central government, yet they work longer hours and cover remits that are significantly broader and more strategic than their peers elsewhere. That fires up a really high intensity. 

Number 10 has a far smaller pool of people. Outside it, every decision with a financial or economic impact comes through the Treasury, and that’s 90 to 95 per cent of key government decisions, often decided by those junior officials. So the culture is work hard, not necessarily play hard.

The Treasury has vibrant policy debates on the inside, which isn’t always understood outside. Because that debate has happened internally, it knows what it thinks and holds the line in discussions with departments, business and civil society. That’s why it can look hard-set, or even cocky and brash—someone who has worked on agricultural or trade policy for decades gets told the Treasury doesn’t agree by someone who’s been in post for six to eighteen months. 

That intellectual confidence is really valuable. When people talk about ‘Treasury brain’ in the newspapers, it’s a pejorative, and of course there are cases where it hasn’t led to the best outcome. But if I were to be so bold: periods when the Treasury has had less influence have corresponded to worse decision-making. The most obvious example is the Liz Truss premiership.

I’ve seen it in the room: an organisation complains to the Treasury about the direction of policy and frames it with ‘particularly when you consider Brexit, or Covid, or the Russian invasion’. I don’t think that ever works. You’re trying to unpick a specific decision by linking it to a wider political context that simply isn’t going to change. Those external things are fixed.

What does work is to give a clear, specific proposal that ties into the direction of travel the government has communicated. If you’re trying to U-turn policy or shift it 90 degrees, you won’t succeed. The Treasury is a steamroller. It’s a tanker. Think of yourself as a tugboat adjusting its direction of travel, rather than trying to reverse or block it.

The junior level is where access is most available. These are really stretched, high-performing people who are desperate for evidence, information and analysis—because it’s hard for them to get. That does not mean ‘Hey, Treasury official, do this,’ but instead: ‘We’ve done this work. It indicates that if you want to achieve Y, the best way is this, and here’s the evidence.’ If the analysis is robust, it will probably feed into the advice that goes to ministers and senior officials.

There are two cornerstones. The first is sector depth. Government consults, sometimes ad nauseam, because it doesn’t truly understand how a sector works—how could a team of five fully understand a sector that employs half a million people? If you can show how a decision will affect incentives, then when the minister says ‘But X’s CEO told me this wouldn’t work’, the official can say, ‘Actually, Minister, this industry group, this think tank and this academic indicate there’d be efficiencies if we did it this way.’

The second is the numbers. The Treasury is very good at internal economic analysis, but there’s only so much bandwidth in a department of about 2,000 people. That’s where the Institute for Fiscal Studies, the Resolution Foundation, or the Institute for Government come in, with a sheer quantity of analysis, broken down and presented clearly. For hard macro analysis, reputation plays a really important role in whether it will be seen as robust: that kind of work isn’t realistic for most organisations.

For those organisations that cover everything, there’s a risk you won’t be seen as the group that does a specific thing. If I can point to an institution my deputy director and minister know as expert in a specific area, there’s built-in quality assurance. If someone looks at the footnote and has never heard the name in that domain, why would they base an important decision on it? 

If you’re a smaller, lesser-known group, look at other routes in. If you’re the junior official responsible for, say, rail policy in the build-up to a Budget, will you make time for an institution you’ve never heard of? Probably not. Would you be more open if a letter came from an MP citing their evidence? Yes, of course.

A few times as a junior official, I built a strong relationship with someone relatively junior on the outside who knew the subject in detail. Having someone to bounce ideas off and help me understand the practice of the policy was really helpful. Those kinds of engagements often had more influence than an established think tank publishing a 100-page econometric assessment.

Someone who brings Treasury officials a booster pack of hard thinking creates a virtuous cycle. Think of the tugboat nudging the tanker in the right direction. If you can nudge my thinking, you’ll end up with more influence.

→ This is a perfect example of the relative benefits of dissemination-based communications functions, and engagement-based communications functions.

So much effort goes into ‘Treasury handling’ that people end up dancing around the actual issue the Treasury has. Other departments use all sorts of tactics: information overload, last-minute submissions, going via a special adviser or minister to get past the Treasury officials. The same is true of outside organisations.

Treasury teams are small, so you can usually walk five metres down the corridor to talk to the person they are trying to bypass. The Treasury minister will come and say, ‘I’ve just heard from this department’s special adviser that you’re doing this,’ and the official will explain why it’s not that simple. Treasury handling often backfires.

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