Obituary: Dame Lesley Strathie, former head of HM Revenue & Customs

WHEN Dame Lesley Strathie took charge of the HM Revenue and Customs (HMRC) in 2008 the service was at a low ebb and morale had been hit by the loss of computer disks that contained the records of 25 million Child Benefit cases. Then head, Paul Gray, resigned and Strathie assumed control with instructions from her political masters to reduce staff and sort out a major muddle.

In her first three years, she initiated savage cuts in staff and closed several tax offices. The criticism was widespread not only from staff but also from within Whitehall. The powerful Public Accounts Committee stated that her actions resulted in a worse service to taxpayers and caused many errors in tax assessments. Worse her second Permanent Secretary, Dave Hartnett, recently faced widespread criticism for so-called “sweetheart” deals to reduce the tax liability of such international companies as Goldman Sachs and Vodafone.

But it was Strathie’s foresight that modernised the Revenue’s methods and upgraded its technology. She was given firm directions to make HMRC more approachable and cut its operating costs. The fact that she was blamed for years of earlier mismanagement was unfortunate.

As Strathie told a House of Commons committee when interrogated about the pensions issue: “We feel deeply, deeply sorry for the distress that we have caused to many customers in bringing personal tax records up to date, and particularly vulnerable customers. I think one of the big groups in each of those years has been pensioners. We have been working through each of these years with ministers and seeking counsel on how we can ameliorate the impact of all of that.”

Lesley Ann Cooke attended Stranraer Academy and left at 16 to join the DHSS as a clerical officer. Transferring to the Department of Employment, she moved to London in 1984. Her commanding grasp of the detail of tax affairs ensured that she was spotted by the hierarchy and was rapidly promoted. In 2000 she joined the senior ranks of the civil service and was made London Field Director at the Department for Work and Pensions the following year. Part of her responsibilities were to control JobCentre Plus – which she had helped to create.

In all these posts Strathie was given the unenviable task to make the DHSS, and her branch of the civil service, cost effective, which invariably meant reducing the staff. She tried to make the cuts wisely and sensitively but admitted: “Our staff are our greatest asset, and we need to be open and honest and really listen to their views on how we can succeed. Staff management is the most challenging task facing the civil service at present.”

On her appointment as permanent secretary and chief executive of HMRC in 2008, she had to answer when the tax fiasco over pension benefits was uncovered. This involved many testing inquisitions both by the media and in parliament. In September last year Strathie was questioned by MPs and she remained fervently loyal to her staff, insisting “no mistakes” had been made by HMRC. She considered it “unfair” to compare the performance of HMRC with top businesses “because business have the privilege of choosing which customers they want.” She concluded her evidence: ‘We serve everybody. We don’t have a choice about who we serve.”

In June 2010 the BBC’s Watchdog programme heavily criticised the workings of HMRC. Strathie, significantly, did not appear in person, providing a statement giving a ringing endorsement of their work. “HMRC wants to deliver a first class tax service. We are acutely aware that we sometimes fall short of our ambition. We handle around 1.2 million telephone calls a week and receive some 74 million letters a year.”

Strathie was in a delicate situation. As Principal Accounting Officer she was answerable to parliament for the department’s expenditure and performance. She had to press through the Spending Review and restructure the top management. This put her in a vulnerable position regarding the media especially when she had to introduce in 2010 a new IT system for PAYE that failed when it went live.

Strathie’s undoubted qualities were her detailed grasp of a brief and her coolness under fire. In March last year she and colleagues were facing a severe grilling by the Treasury Select Committee about the use of phone numbers and the length of time HMRC took to reply. The questions from the MPs came fast and furious but Strathie remained calm and restrained. She answered all the questions in her pronounced Scottish accent with courtesy and convincingly.

Throughout this period Strathie’s own personal health became a major problem. She was diagnosed with cancer in July 2011 and was given immediate sick leave. She resigned last November to concentrate on her treatment but died just two months after leaving HMRC.

Many tributes from colleagues in Whitehall were paid to Strathie when her death was announced. The former Cabinet Secretary, Sir Gus O’Donnell, said her departure from the service had come “at a time when HMRC was achieving very real improvements in its performance”, and hailed her as a “wonderful role model”.

Strathie, who was made a DBE in 2010, developed many outside interests in the arts and sport – principally the plays of Shakespeare and Arsenal FC. She married, in 1974, David Strathie, with whom she had a daughter and a son who predeceased her. They divorced in 1996. At the time of her death she was finalising plans to marry Kevin White, a human resources director at the Home Office. ALASDAIR STEVEN