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Friday, 4 January, 2002, 11:53 GMT
Profile of Gus O'Donnell
Treasury logo
The mandarin behind the Treasury door
Gus O'Donnell, the official who is in charge of the assessment of whether the UK should join the euro, is a veteran Treasury mandarin who served as John Major's press secretary both when he was chancellor and as prime minister.

Last year, Mr Blair reportedly tried to lure him back to No 10 to become his senior economics adviser, but he decided to stay at the Treasury

Frankfurt bakery
Will the UK adopt the euro?
Mr O'Donnell, who chose to return to the Treasury from Downing Street in 1994, became deputy director of the Treasury and then served as the UK's representative on the IMF and the World Bank while working at the UK Embassy in Washington.

That left him conveniently out of the UK during the General Election of 1997.

Labour choice

When Labour came to power, Mr O'Donnell was persuaded to return to Whitehall, sharing power with Ed Balls, Gordon Brown's long-standing political advisor who became chief economic adviser in 1999.

In November 1997, Mr O'Donnell was made managing director, Macroeconomic Policy and International Finance, and head of the Government Economics Service, in charge of long-range forecasting with a team of more than 500 economists.

Nigel Lawson
Mr O'Donnell served under three Chancellors, starting with Nigel Lawson
His responsibilities also include planning the Budget, debt repayment, and relations with the Bank of England, as well as worrying about the value of sterling.

He serves as the Treasury's representative on the Bank of England's Monetary Policy Committee, giving them details of the government's spending plans and participating as a non-voting member of that group.

As one of the chief architects of the monetary and fiscal policy framework created by Labour, it is not surprising that he believes these to be superior to the rather more haphazard arrangements in the eurozone.

And Mr O'Donnell, like many others in the economic establishment, was scarred by Britain's experience of being forced out of the Exchange Rate Mechanism - during the period when he was Mr Major's press secretary.

South London boy

Mr O'Donnell grew up in Vauxhall, across the river from the Houses of Parliament, before studying economics at Warwick and then Oxford. He briefly lectured at Glasgow University before joining the Treasury in l979.

In his high-flying Treasury career, he was seconded to Washington in the early l980s before working for Nigel Lawson when he became chancellor.

Mr O'Donnell, who is 49, is believed to be in line for the top job at the Treasury.

His people skills are legendary, and he is widely liked for his down-to-earth, non-stuffy style of management.

His skill at reading the political runes is also not in doubt, as someone who has not only survived but prospered during the political earthquake that shook Whitehall when Labour came to power.

He played a key role in ensuring a smooth transition to power and implementing the new fiscal and monetary policies.

It was Mr Balls, not Mr O'Donnell, who largely devised the five economic tests for UK membership of the euro.

But it will take all of Mr O'Donnell's skills to satisfy all sides in the highly contentious area of the euro.

See also:

04 Jan 02 | UK Politics
Treasury disputes euro comments
03 Jan 02 | UK Politics
Early euro vote 'unlikely' says Major
05 Jul 01 | Business
Treasury doubts on the euro
01 Jan 02 | UK Confidential
Treasury's 1970 'euro' warning
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