Jon Thompson is permanent secretary and CEO of HMRC.
He’s held the position since April 2016, when the organisation was starting work on one of its biggest projects in years: Making Tax Digital.
Thompson has made a career out of shaking up the public sector. Before HMRC, he was director general of finance and then permanent secretary at the Ministry of Defence (MoD), where he oversaw one of the largest organisational changes in Europe, a restructuring that reduced costs by 20%. Before that, he was the first finance director of Ofsted, which led to him becoming director general of corporate services for the Department for Education.
All of Thompson’s prominent central government roles came later in his career: his children were grown up by the time Thompson moved to London and soared up the ladder. “It was a complete really, that I joined the civil service,” he explains. “After Gordon Brown, in the 2004 Budget, said he was going to recruit some finance people to professionalise the civil service, I got a phone call: ‘Do you fancy coming in and having a conversation?’”
Thompson’s story is testament to how far hard work and determination can take you. Here, he takes us through the milestones of his career, and the lessons he’s learned.
On specialising in the public sector
I did CIPFA after I completed the AAT qualifications. After a while, you develop an affinity with the public sector. There’s something special about wrestling with some of the really significant issues of state or the economy, which you get to do in the public sector.
I did work in the private sector. I spent two years working for Eagle Star, which is a defunct insurance company, and then I went to EY for five years, which was a fantastic experience, doing advisory, external order and all sorts.
One of my biggest clients – a local authority – tempted me back to the public sector. They needed a director of corporate services, so I applied. After five years of advising people how to do things, I wanted to see if I could do it myself.
On his MoD time
I was director general of corporate services at the Department for Education when I got the chance to work for the MoD. It was the last government organisation to get its own director general of finance. I had no background in defence, so it was a bit of a culture shock.
For one thing, it’s a very, very large organisation; we had a ten-year budget of around £360bn. The balance sheet is strong enough to enter the FTSE at number three.
It was an incredibly steep learning curve; in addition to being extremely complicated financially (it genuinely does involve rocket science), defence has this incredible internal language that is hard to understand if you don’t have a defence background. ‘Buckshee’, for example, means spare equipment.
One of the key challenges that every finance person faces is: how can you communicate complicated financial ideas in a language that non-finance people understand?
The biggest challenge at the MoD was the culture change needed as part of the work we were doing. Undertaking one of the largest organisational change programmes in Europe requires a big shift. You can simplify processes, get control of the money and put in accountability systems, but how will you behave as a person in this new system? Are you going to change it enough so that, for example, you take responsibility for finance as a business leader? That takes longer than changing systems and processes.
It’s generally the last thing that changes in an organisation. The key to making it work is listening and learning. It taught me a lot about being a leader. I remember when Philip Hammond, who was defence secretary at the time, stood up in Parliament and announced that the MoD had got control of its budget at a time when public debt was out of control. That was probably the highlight of my time there.
Do as many different things as you can. Diversity is great. It gives you depth of experience
On his early days with AAT
I left school at 18. I didn’t go to university. We were a very working-class family: go to the comprehensive, leave with a bunch of A Levels – that sort of thing. I became an apprentice at the local council and they said: “We want to do some structured learning.” So I did a couple years of a BTECH National in business and finance.
That then enabled me to go on to do the AAT qualifications in 1986. It was fabulous, because I could relate the work I was doing with the structured learning that I was getting at the college. My son is currently finishing his AAT qualifications. He’s following in the old man’s footsteps because AAT gives him a great platform. It doesn’t necessarily mean he’ll become an accountant – AAT opens up doors.
I can also think of a friend of mine in their mid-40s who has been doing bookkeeping and finance for a while, and is now doing AAT on the basis that it might open up something else for the rest of their career.
AAT offers an age-blind qualification that enables you to access other opportunities. Then it’s down to you to use the platform however you want to – whatever suits your life.
On transforming HMRC’s vision
When I first started at HMRC, I assumed that there was a vision for where it would go, but there wasn’t, and we needed to deliver some serious digital change.
After three months of discussion with colleagues we decided this: we wanted to be a world-class organisation in our field. PwC recently said that
we were second in the world.
We think of ourselves as the largest customer-service organisation in Europe. In the past couple of years, we’ve significantly improved from the lows of 2015. If you want to ring us now, it takes us on average under five minutes to pick up the phone, whereas before it was more than 30 minutes.
We actually break customers into six different groups. One of those groups, believe it or not, is organised criminals. We treat them as a discrete set of customers. It’s about getting the balance correct between helping the vast majority who want to get things right and cracking down on the actual criminals.
We’re also one of the biggest digital businesses in Europe. By the spring of 2016, 18 million customers had a digital tax account with us. That means we must span a number of disciplines, not just tax.
Making Tax Digital is a way for us to strip out some of the complications and make it easier for people to do business. I did my self-assessment online in under ten minutes. We’ll soon be able to link our computer system with yours, so the information just transfers digitally out of your system into ours, when you’re ready. It could completely remove the need to fill out forms. We think there’s a lot of potential in that.
On the need for balance in your career
Your decisions in life need to be a blend of the career-focused and personal. You have to think about where you want to live and how your choices affect the important people in your life. Do you want to maximise your earnings or not?
You have to sit down and make those decisions with your loved ones. I didn’t start working in London until later on in my career. We moved when I was 48, as my children had started to leave home. There was a point when my children’s education was the priority – that meant that, if I wanted another job, I was limited to 50 miles from where we were living, to give them that stability.
When the youngest one went off to university, we thought: “Do we have to stay here or not?” My final piece of advice would be: do as many different things as you can. Diversity is great. It gives you depth of experience. I think this is my 22nd job and my eighth employer. It may or may not turn out to be my last.
This article appeared in our summer 2018 issue of 20 magazine.
Mark Rowland is the Editor of Accounting Technician and 20 magazine.