Mm02 man to shake up Revenue

DAVID Varney, outgoing chairman of mmO2, is to be the first chairman of the soon-to-be merged Inland Revenue and Customs & Excise, charged with combining two cultures which are at each others' throats and cutting 10,000 jobs.

Chancellor Gordon Brown also announced that the new department will be called Her Majesty's Revenue and Customs.

Varney will take a sizeable pay cut when he moves from the private sector to the public on 1 September. Last year, mmO2 paid him £517,000. His new job is expected to pay no more than £250,000.

Varney, 58, is known for his sympathies to the Labour Government. He heads Business in the Community, one of Prince Charles' favourite business groups. He was also in bookies' lists for the vacant chair at Marks & Spencer.

Varney said: 'This is one of the biggest delivery jobs in Government and I am very excited about the challenge.'

He was one of the three captains of industry consulted by Gus O'Donnell, Permanent Secretary to the Treasury, whose report in March led to the merger of the two departments.

Varney said: 'It is quite clear it will be a tremendous challenge for everyone involved. That includes the staff, who will have to balance the demands of ongoing work with the uncertainty of change.'

Businesses and the CBI have expressed serious concerns over the inevitable disruption to be caused during the merger process. Meanwhile, civil servants in both camps have warned of the clash in cultures between the 'jackboots' approach of Customs & Excise and the more-gentlemanly ethos in the Inland Revenue.