Profile – Leading a tax revolution.

Nick Montagu, chairman of the Inland Revenue board, says he is not the ‘hard man of the Revenue’.

He certainly has a big job to do at the department. It has embarked on unprecedented changes that see it taking on the role of a benefits agency, undergoing wholesale reorganisation of its management structures, and shifting emphasis to become not an enforcer but an ‘enabler’ for taxpayers so they find it much easier to comply.

Some would describe the changes as groundbreaking, others radical, but when Montagu is asked by staff if change can be swapped for a little bit of ‘consolidation’, the man in charge has to remain firm.

‘At times I visit very hard-pressed local offices and they say “there’s been nothing but change, change for five years. Can’t we have a period of rest and consolidation?”, not rest and recreation.

‘And I say to them no, we’re in the business of implementing a huge and exciting programme of change and of breaking new ground and I know it imposes strains. But the consolation for us is that we are in a department that matters, and they understand that,’ he says.

Listening to Montagu in his enormous Somerset House office it’s difficult not to buy into what he says. When he speaks he is convincing. Not only that but he talks the talk with genuine passion, a rare feat for a manager so long in the job. But he’s also something else. He’s sincere. It’s clear he believes in what he’s saying, and its apparent that he wants to succeed.

Labour, and its Modernising Government White Paper, has given him work that the most senior man in the Revenue is clearly engaged with and keen to push ahead.

Montagu is well known as the philosopher turned civil servant. From Reading University, where he taught, he moved to the Department of Health and Social Security in 1974 and then on to the Cabinet Office before a spell with the social security side of the DHSS.

Successful years followed and he became head of personnel for the whole department. In 1990 he was promoted to deputy secretary in charge of social security at the DSS. But in 1992 came his most high profile ‘policy job’ undertaking the privatisation of British Rail. In 1997 he made a move to the Cabinet Secretariat to become head of the Economic and Domestic secretariat and just a few months later, following Labour’s election victory, he was appointed to the Revenue board.

He has, in the three years that have followed, generated huge respect for his work. Labour obviously sees him as the man succeeding at implementing the measures it wants, and experts in tax believe he is a man they can do business with. He is said to be furiously intelligent while also managing to be genial company.

It’s not hard to see why. He makes a point of getting to meet staff in even the smallest offices to find out what’s going on.

‘My style is a very informal one. I get out to offices, I leave my jacket in the manager’s office and I pass around from pillar to post talking informally in small groups, with first name terms all round. It’s about wanting to hear as it really is from their point of view,’ he says.

And these visits are about communication and he says, standing up to be counted for his staff. Listen to Montagu speak anywhere and you’ll hear him pepper conversation and statements with praise for his staff.

Whether it be select committee, press conferences or interviews, he makes sure his staff get credit whatever the occasion.

‘I think this is the reason why I am not seen as the hard man of the Revenue,’ he says and goes to detail how he makes sure the 67,000 Revenue get as much praise as he can possibly bestow upon them ‘in what I write, in my public speeches, but also defending them against unfair criticism’.

The press, he says, ‘holds no terror’ for him.

And it’s not that pleasant being on the receiving end of a remonstration. Two weeks ago in a select committee hearing MP Michael Spicer suggested there was a blockage at the Revenue holding up closer working with Customs & Excise. Montagu jumped on the statement and brought questioning to a halt while he made it clear the Revenue could not be blamed. But he pointed out the Revenue has to ‘ruthlessly prioritise’.

With the advent of tax credits the department’s role is being transformed, and the transformation – one in which the tax collector becomes benefits agent – is a radical one requiring a new skills set and a culture change.

These are issues Montagu is grappling with and which are all bound up with his drive to take the Revenue through a shift which will see it become more attuned to the needs of its customers.

He wants the Revenue to become an agency that helps people understand regulation so they can comply – rather than just being focused on forcing people to pay up.

With uncommon idealism for a civil servant he is mulling over a proposal to ministers for taxpayers, personal and corporate, to be provided, along with their tax demands, with information showing just where their money is being spent.

‘If we could show on a pie chart the heads of government expenditure the previous year, so there’s a link between the demand you receive, for however many pounds it may be, and health expenditure, a link between what the Revenue takes from you and a perceived public good,’ Montagu says he thinks public perception of the Revenue might change.

He is impressed with corporate bodies in the US boasting how much tax they have paid, not how much they avoided, and Dutch taxpayers who have begun talking about what they ‘contribute’ instead of what has been ‘screwed’ out of them.

Montagu knows it will be tough. Just as changing the Revenue from within will be tough.

But is Montagu happy with his task?

‘Yes I am. It’s a huge challenge. It’s an incredibly exciting time to be at the Revenue because all these challenges mean that we really are a front ranking department.’

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