The new chancellor, Rishi Sunak, will use next month’s budget to announce plans to move some of the 1,500 staff working for the Treasury to a base in the north of England, government sources confirmed on Sunday.
The plan, which directly mirrors a pledge in Labour’s 2019 general election manifesto, will be presented as proof of Boris Johnson’s commitment to his “levelling up” agenda – as well as signal that he is serious about imposing structural reform on Whitehall.
“The chancellor wants to put the Treasury at the heart of the levelling-up agenda and wants to rethink how we make decisions that affect the whole of the UK,” a Treasury source said.
“He wants to shift the gravity of economic decision-making away from the capital to our regions and nations – and setting up a new … campus in the north of England will do that.
“It will be key in helping spread opportunity and prosperity to all, and allow the Treasury to access a more diverse range of talent, making it more reflective of the country as a whole.”
Sunak, who was brought up in the south of England but who represents a Yorkshire constituency, Richmond, will confirm the announcement when he presents his budget on 11 March.
The Tees Valley is reportedly a possible site for the new Treasury hub, and the first staff are expected to move in 2021. Government sources have refused to say how many jobs will be transferred.
Sunak is also expected to announce that some Treasury posts could be relocated to Scotland, Wales and Northern Ireland.
In its election manifesto, Labour promised to place a Treasury national transformation fund unit in the north of England and John McDonnell, the shadow chancellor, said that if the Tories were copying his proposal, “they could have the decency of properly attributing the idea to Labour.”
Downing Street has also floated the idea of moving the House of Lords to York as part of Johnson’s plans to make government less London-centric, although given the strong opposition to the proposal amongst peers, and Johnson’s lack of a majority in the upper house, this is not yet being seen as a wholly serious proposition.
News of the plan to move some Treasury staff to the north of England came as David Davis, the former Brexit secretary, criticised Johnson for apparently seeking to implement Whitehall reform by “firing squad”.
Davis was responding to a Sunday Telegraph story quoting unnamed Tory sources claiming that Johnson wants to get rid of three senior permanent secretaries: Sir Tom Scholar, head of the Treasury, Sir Philip Rutnam, head of the Home Office, and Sir Simon McDonald, head of the Foreign Office.
In an interview for the BBC’s Andrew Marr Show, Davis said that although he thought there were “issues to resolve” in the civil service, he thought No 10 was going about it the wrong way.
“You don’t solve a piece of managerial reform with a firing squad, that’s not the way to do it,” Davis said.
“There are ways of making government work better, there are ways of making the permanent secretaries behave better but it doesn’t involve making hitlists.”
Downing Street did not comment on the Sunday Telegraph story. But the Home Office did issue a statement denying a separate story in the Sunday Times claiming that M15 officials are withholding information from Priti Patel, the home secretary, because they do not trust her.
“The home secretary and MI5 have a strong and close working relationship, and baseless claims to the contrary are both wrong and against the public interest,” a government spokesperson said.
“The home secretary receives the same daily intelligence briefings as her predecessors, and no information is being withheld.”