Now he’ll get a chance to translate his firm advice into actual policies in a country that long since should have adopted most of them -- the U.K.
The 57-year-old Briton last month accepted an appointment to become the second permanent secretary at Her Majesty’s Treasury, making him the No. 2 civil servant working for Chancellor of the Exchequer Gordon Brown. Stern, who takes up his new post in September, will oversee tax policy, help prepare Brown’s annual budget statement and steer the Treasury’s work on welfare reform, labor markets and pensions.
After spending so long dispensing advice, the chance to wield real power is irresistible. Says Stern, “The challenge to help improve the products and services that government provides, and to do that in a way that brings poor people into the story, is an absolutely fascinating challenge for an economist who, like myself, has been thinking about public policy.”
The job will thrust the Oxford-trained economist into Britain’s debate about the euro, which is expected to be one of the country’s most contentious issues in the year ahead. He will be in charge of implementing Brown’s fiscal policy rules, which oblige the government to balance its budget over an economic cycle but give it the flexibility to run deficits in any given year. Brown considers his rules superior to Europe’s more rigid Stability and Growth Pact, and he’s made reform of the pact a condition of any British agreement to adopt the currency.
Stern seems to understand a key difference between analysis and policymaking -- he demurs when asked about British entry into the euro zone. “My first responsibilities are on the U.K. economy,” he says.
