It’s not because they don’t like the place. It’s not because they think they’re over worked. And Sir Howard asserts that it’s not because the work isn’t interesting – who wouldn’t want to come down hard on City institutions who couldn’t care less about money laundering?
No, Sir Howard’s problem is that his staff just keep being drawn away by recruiters from the private sector. He has even complained bitterly to MPs about this phenomenon to the point where he warned companies and recruitment agencies to lay off.
Indeed, Sir Howard revealed he had taken the extraordinary step of writing to financial services companies ‘to say they should be thinking carefully about recruiting regulators’.
Of course he didn’t get to the ‘or what’ bit, but clearly dealing with the problems brought on by a high turnover in experienced employees rankles the chief City regulator.
But there are numerous reasons for wanting to leave behind the worthy world of the public sector and get your feet under the table at a dynamic company or firm.
One, is career progression.
A former Customs man, now a partner at a Big Four firm, says it was the monotony of remaining at the same grade for a decade at a time that was the real driver for abandoning the civil service.
‘For most people it’s the lack of career possibilities in the civil service.
The trouble is that you stay in the same grade for 10 or 12 years, whereas in the private sector promotion is all on merit and you can move along much more quickly.’
Of course, career prospects go hand in hand with reward and the potential rewards in the private sector are much higher. It is not uncommon for senior managers to leave behind their jobs at the Inland Revenue and Customs & Excise to double their income by becoming partners at big accountancy firms.
So why turn to the public sector instead of developing talent in-house?
Well, the cynical truth is officers of organisation like the Revenue, Customs and the FSA have inside knowledge the private sector wants.
For the FSA, the demand for its staff may be an indication of the demands put on firms by regulation. Equally, accountancy firms want experts in VAT and tax to provide essential information to clients.
But there are other reasons. Changes in tax law can result in a need for skills that are difficult to develop quickly through in-house training.
The only option is to turn to the policemen and watchdogs and poach their staff.
‘In the 1980s there were many changes in VAT and the only place we could get people quickly was at Customs,’ said one partner.
That should come as some comfort to Sir Howard. The FSA is only ending its first year with full powers – when the regulation settles down so should the efforts to pinch his staff.
For more, see www.fsa.gov.uk.
Mark McMullen joins the private client services team from Smith & Williamson
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