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Chancellor Rachel Reeves is ramping up a policy commitment to economic growth by hiring one of the City of London’s top investment bankers, filling a hole in the Treasury that has been empty since 2022.
Jim O’Neil, a senior investment banker at Bank of America, was on Wednesday be named as second permanent secretary at the Treasury focused on growth.
O’Neil’s appointment comes as ministers finalise an industrial strategy, the centrepiece of the Labour government’s growth strategy, due to be published next month.
“It should have been done sooner,” said one government adviser.
One person close to the appointment said senior Labour figures had been talking to O’Neil since before last July’s election, but there had been much “faffing”.
O’Neil is the first senior City of London figure to hold the second permanent secretary growth role since Sir Charles Roxburgh, now chair of the Lloyd’s of London insurance market, left the Treasury in 2022.
The move marks a return to the public sector for O’Neil, who won plaudits for running UK Financial Investments, the body set up after the financial crisis to manage the government’s stakes in bailed-out banks.
The 58-year-old investment banker, who has run Bank of America’s corporate and investment banking operation in Europe, the Middle East and Africa for the past eight years, is due to start at the Treasury in July.
“His extensive knowledge of the private sector will be vital in helping us deliver our number-one mission to grow the economy,” said Reeves.
The Treasury launched a formal recruitment process for the second permanent secretary role in December 2024, offering a salary of up to £200,000.
O’Neil will replace Cat Little, who was second permanent secretary but had different responsibilities focused on public spending and international finance, with a remit to work with business to unblock barriers to growth.
The New York-born banker, who is a naturalised Briton and in 2014 received an OBE for services to British banking, has agreed a plan with the Treasury for him to sell his unvested shares in BofA as soon as he receives them.
The job advertisement said the successful candidate would be “tasked with engaging the business community to continue to understand how government and business can work together to deliver enhanced growth and the government’s wider priorities”.
It also said the Treasury was looking for someone with “deep financial, business, commercial and analytical experience” and that private sector and corporate finance experience was “essential”.
O’Neil, not to be confused with former Treasury minister and economist Lord Jim O’Neill, has previously held a key public service role.
He was charged with selling the government’s stakes in Royal Bank of Scotland and Lloyds Banking Group as head of UK Financial Investments, a job he quit in 2013 to rejoin Bank of America Merrill Lynch.
“We are living through a time of great change globally, making the need for an economy of stability, resilience and growth all the more important,” O’Neil said on Wednesday.
