The Treasury is, has been, and probably always will be dominant in Whitehall, and Philip Hammond has inherited its leadership at a crucial moment for the UK economy and public finances. A sober public image has led to the new chancellor frequently being mistakenly for being an ‘accountant’, but his background is actually in entrepreneurial business, where Hammond was not shy of taking risks.
A post-Brexit ‘reset’ of UK fiscal policy will have a massive impact on the UK economy and public services, especially higher education. Hammond has hinted that austerity and his predecessor’s fiscal targets may be tweaked or abandoned, and his upcoming Autumn Statement is hotly anticipated by the sector. After guaranteeing EU funding for science and research up to 2020, pressure will come from the sector to look beyond, as well as underwrite structural funding and other sources of universities’ EU income.
However, a post-Brexit recession may require further spending cuts which could fall on HE. That said, Hammond is thought to be arguing for a Brexit settlement that maintains as much of the single market as is possible, which should make him a key ally for the HE sector’s broader interests.