In profile: David Varney, chief executive designate of HM Revenue & Customs

by Rachel Fielding

19 May 2004

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The party has not yet started for Varney, who officially steps into the role as executive chairman of Her Majesty's Revenue and Customs (the new name for the combined department) on 1 September 2004. But already the sheer scale of the role that awaits him has left some pondering whether even he is up to the job.

But to many, the chemistry graduate's appointment will come as no great surprise. In fact, Varney was one of a few senior executives involved in a review, instigated by permanent secretary to the Treasury Gus O'Donnell, looking at the possibility of merging the two departments.

The Treasury signalled back in March that it wanted a 'captain of industry' for the job, which even Varney described as one of the biggest delivery jobs in government. Varney, a self-confessed opera fan, must have hit the right note.

The task that stands before him is Herculean. The government, conscious of the challenge ahead, made public the need for strong leaders to supervise the planned merger and ensure it does not descend into chaos.

As if managing an organisation employing 90,000 and with an annual budget of £4.2bn wasn't enough in itself, the Treasury has already stated that reducing the tax gap, currently estimated at £26bn, or 8% of the total tax take, will be one of the main areas of concentration for the board of the new tax gathering body.

The Treasury claims that huge improvements in information sharing between the departments will help claw back some of that shortfall, alongside the benefits accrued from its clampdown on tax avoidance.

Ever one for a challenge, the role will add to Varney's impressive list of tenures at private sector giants and memberships of countless institutions.

Varney spent almost 30 years at embattled oil giant Shell before moving in 1997 to become chief executive of FTSE100 energy company BG Group.

No stranger to massive change management projects, Varney joined mm02 in 2001 to oversee its demerger from BT, and the experience should stand him in good stead for the upcoming merger.

His other roles include chairman of Business in the Community since January 2002 and council member of the Confederation of British Industry, to name but a few.

Varney faces a daunting task in reconciling disparate information technology systems at the Revenue and Customs, shedding 10,000 jobs and saving £200m a year from budgets. The search continues for one of Varney's key allies - the chief information officer of the combined body - a role described as crucial to the merger.

Listing Formula 1 motor racing among his interests, one can only hope the transition to the public sector pace (not to mention paypackets) won't come as too much of a shock.

And that the 'coming together' of two departments will take on more positive connotations under Varney's leadership that the oft-used phrase by racing commentator Murray Walker.

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