City doyen takes Revenue hot seat

Daily Telegraph: City doyen takes Revenue hot seat

City doyen takes Revenue hot seat
By Tessa Thorniley (Filed: 14/05/2004)

David Varney sits on many government task forces

The Government yesterday appointed City heavyweight David Varney as the first executive chairman of the newly merged Customs & Excise and Inland Revenue.

Gordon Brown described the outgoing chairman of mobile telephone operator mmO2 as an “outstanding business leader with a first-rate, proven record across the private sector”.

Since he announced plans to quit mmO2 in December, the 58-year-old’s name has been linked with top jobs at Shell, where he worked until 1996, ITV, Channel 4 and earlier this week, Marks & Spencer.

As executive chairman of HM Revenue and Customs, Mr Varney will oversee one of the biggest mergers in British history. He steps up in September.

For about a third of his £500,000 plus pay package at mmO2 , Mr Varney will have the task of managing 100,000 staff (after shedding 10,500), integrating a raft of new IT systems, and collecting over £325billion in annual revenues – while saving £200m a year from his annual budget.

A Treasury spokesman said: “He will earn around £150,000 basic salary with a modest performance related bonus – in the low five-figure range.” Mr Varney was parachuted in as chairman of MmO2 three years ago to help demerge the group from British Telecom.

He was appointed because of his experience as chief executive of British Gas, where he oversaw the utility’s break-up in October 2000. Until 1996, he worked his way through the ranks at Shell, eventually becoming director of Shell International Petroleum.

Since 1998, Mr Varney has been a favourite in Whitehall, sitting on a host of Government task forces. He is currently chairman on Business in the Community, a member of the president’s council of the CBI and president of the Institute of Employment Studies.

Chas Roy-Chowdhury, head of taxation at the Association of Chartered Certified Accountants, said: “If Mr Varney is given the opportunity to take the department forward and to focus on the needs of businesses and taxpayers, that’s exactly what is needed. My concern is that he will be hampered by layers of bureaucracy.”

Paul Gray, second permanent secretary in charge of pensions and disability at the Department for Work and Pensions, will be deputy chairman.

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