Treasury official drafted in to sort out the Dept of Transport
SIR ALAN BAILEY, who has died aged 91, was a Treasury man who, having risen to Second Permanent Secretary, was – in his own words – imposed on the Department of Transport in 1986 to exert control over it.
His five years there rounded off a career including periods as private secretary to Edward Heath’s Chancellor Anthony Barber, and on the Central Policy Review Staff (CPRS). But, crucially, he headed the DOT as ministers let the private sector build and operate the £120 million Queen Elizabeth II bridge at Dartford.
Government capital projects had been governed by the “Ryrie rules”, that “any privately financed solution must be shown to be more cost-effective than a publicly financed alternative”. Ministers felt this unduly restrictive, and Bailey’s mastery of costbenefit analysis was crucial in devising a watertight alternative.
In 1988 the Transport Secretary Paul Channon transferred the Dartford-thurrock tunnels from Kent and Essex county councils to Dartford River Crossing Ltd. The company took on the bridge, then under construction, and the risk of not recovering its costs.
Bailey later certified that the economic gain from removing a bottleneck on the M25 had justified bypassing the Ryrie Rules. Public Finance Initiative projects would be in vogue for two decades under Tory and Labour governments – later ones imposing a heavy burden on the NHS.
Bailey treasured the “wartime tradition of trust and co-operation between ministers and senior officials” that persisted in Whitehall. Deep into his retirement, he was outraged by reports that Boris Johnson’s special advisers were briefing against civil servants’ handling of the Covid crisis.
He wrote in The Guardian: “What a picture emerges of our current government: a head of the civil service [Sir Mark Sedwill] without much experience of Whitehall, trying to co-ordinate the work of departments headed by permanent secretaries appointed to make huge cuts and struggling to win the trust of small-state politicians surrounded by clamorous special advisers and instinctively suspicious of departmental advice.”
Alan Marshall Bailey was born at Rushden, Northants, on June 26 1931, the son of John and Muriel Bailey. From Bedford School he won an exhibition to St John’s College, Oxford; he was elected an honorary Fellow in 1991. Graduating, he stayed in Oxford to do an Mphil at Merton.
He looked set for a career at the Bar, but joined the Treasury and became private secretary to the Economic Secretary, Edward Boyle. Soon after Boyle left politics in 1963 and became chairman of the Harkness Fellowship selection board, Bailey sent in an application to study how the US government employed its economists. He spent a year at Harvard, on his return being put into the Treasury’s pay division “for the good of his soul”.
From 1971 he headed Barber’s private office during two years of rapid growth that aroused alarm among the monetarist element on the Tory benches. Bailey spent eight years in senior Treasury posts, then in 1981 joined the CPRS. Successive governments valued its long-term policy advice, but Margaret Thatcher felt it too technocratic for a government with a “firm philosophical direction”.
After the 1983 election she absorbed the CPRS into the No 10 policy unit, and Bailey returned to the Treasury as Second Permanent Secretary. Peter Middleton was beginning an eight-year stint as permanent secretary, so for a final promotion he moved to the DOT.
Retiring in 1991, he joined the board of London Transport until 2000, for a time chairing London Buses. He was appointed CB in 1982, and KCB in 1986.
Alan Bailey married Stella Scott in 1958. In 1981 they divorced and he married, secondly, Shirley Barrett. She survives him with three sons from his first marriage.
Alan Bailey, born June 26 1931, died April 22 2023