Stephen Carter: Gordon's gatekeeper

Stephen Carter was planning a quiet Christmas with his family after being abroad on business when a man he hardly knew came on the telephone to offer him a job that offered appalling, severe disruption to every aspect of his life, and only a fraction of the salary he was used to earning. Gordon Brown was asking him to come to Downing Street to run his private office.

Appropriately, Carter had just begun the book he had chosen as his holiday reading – The Alastair Campbell Diaries – which should have served as sufficient warning that no one sane would go and work in the Downing Street hothouse even if, like Campbell, they had the advantage of a strong personal relationship with the Prime Minister going back several years.

Carter barely knew Gordon Brown. Their link was through Alan Parker, founder of Brunswick, one of the world's biggest PR firms, where Carter was chief executive. Insofar as Carter had a party allegiance it was assumed to be to the Liberal Democrats, who thought of him as a possible candidate in the London mayoral election.

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Carter has a reticent, self-effacing manner, and looks like an academic. He is a dedicated family man, without a hint of scandal in his life. It is a mystery how he spent the large fortune he accumulated from his years in the advertising industry, because he is not known to have any extravagant habits or hobbies.

"He is the most boring man I ever met," one person who has dealt with him professionally remarked, unkindly. And yet, when Carter was head of Ofcom, the media regulator, the same witness observed: "Television executives swarmed around him as if he were some TV celebrity although he was the greyest character imaginable. No one would want to hang out with a dullard like that, if it wasn't clear even then that he had influence."

Others who know him say that "boring" is the wrong word to describe him, but he has the brisk manner of an efficient executive who does not have time to waste. His career path certainly suggests a man who gets what he wants. Born in Scotland in 1964, he graduated with a law degree from Aberdeen University, but decided that he could not afford to study for the bar exams, and so went straight to work for J Walter Thompson, one of the best known advertising agencies in the world. He rose at an extraordinary speed, becoming managing director of its UK arm at the age of only 30, and chief executive two years later. One account he handled was Kellogg's Corn Flakes – a useful early experience in marketing a product that has been around so long that it is almost a byword for dullness.

In October 2000, Carter left to become chief operating officer of the cable operator NTL. It was a risky move, because NTL was in imminent danger of sinking under the weight of debts accumulated by buying every cable business and regional franchise it could get its hands on. He had not been at NTL long when rumours about the company's troubles caused an ominous dip in the share price. This was when Carter stepped into the limelight as the smooth-talking public face of NTL, which blamed "excessive pessimism" for NTL's troubles on the stock market. The share price recovered.

That quick success nearly brought long-term disaster when the "excessive pessimism" which he had decried turned out to be grimly accurate. In April 2002, NTL filed for Chapter 11 bankruptcy protection, with debts of about £8bn. The previous year, Carter's pay had come to more then £330,000, including a £130,000 bonus. He left late in 2002, with a pay-off of £1.7m.

No one has suggested that he was responsible for the state of NTL's finances, but aggrieved investors filed a law suit in New York, accusing him of having "issued false statements" to hype up NTL's share price. One damning allegation in the documents they filed was that during a telephone conference in 2001, Carter had been asked by NTL customer marketing director how he could persuade investors that "NTL is going to be OK, when you know it isn't". Carter's reported response was: "What I tell them is nine-tenths bullshit and one-tenth selected facts."

Whether he really said it or not, it is a quote that will stick with Carter now for as long as he is at Mr Brown's side.

Meanwhile, he had taken on another high-profile and risky job, as the first chief executive of Ofcom, the single agency created by merging five media regulators. It was a role in which he could easily have failed badly. As one admirer put it: "There is no industry more cynical, more ruthless or more brutal than the media, and yet there is almost unanimous recognition of Stephen's effectiveness."

The job also gave him his first regular contact with politicians. The Labour politicians who have since been his biggest champions were the Culture Secretaries Tessa Jowell and James Purnell, both loyal allies of Tony Blair. He is not known to have had any ties with the tight circle that has surrounded Mr Brown for years – which makes the Prime Minister's approach all the more surprising.

After the personal grief that he inevitably brought upon his head by entering the snake pit of Downing Street, he also condemned himself to the sort of salary he put behind him in his 20s. Most people might think that his current pay packet of £185,000 a year is riches, but at Brunswick PR, Carter's annual salary was nearer £500,000. However, no one expects him to stay in politics for the long term. If Labour snatches another general election victory, he will be able to return to his old profession with the added cachet of being a political insider. And if Labour loses, he will not be on the breadline.

From a position of strength, Carter drove a hard bargain during the series of intense meetings he had over Christmas with the Prime Minister, whose self-confidence had been shaken over a disastrous autumn. He extracted a deal that gave him complete control of the political side of operations in Downing Street, including the decisions on whom to hire or fire, and over the Prime Minister's speeches and statements made in his name. For good measure, he insisted on bringing his secretary with him from Brunswick.

Carter was shocked by the chaos he encountered when he arrived in Downing Street, but his reaction was as nothing compared with the shock he administered to some long-serving staff already there. Worst hit was Spencer Livermore, director of political strategy, who had been a political adviser to Mr Brown for 10 years, and who left unhappily, after being ejected from his office so that Carter's secretary could move in. Tom Scolar, Mr Brown's chief of staff, was packed off back to the Treasury.

Carter hired three fellow professionals from advertising marketing – Nick Stace from Which? magazine, David Muir from the WPP advertising agency, and Jennifer Moses, who is famous as the Goldman Sachs executive who did not notice when more than £1m had been embezzled from her account by her assistant.

These are very different people from the civil servants and think-tank alumni who had thrived in free and easy chaos around the Prime Minister, roaming about at will. Suddenly, a strict regime was applied to the Prime Minister's time, and no one could reach him without passing the office which Carter shares with Jeremy Heywood, whom Mr Brown brought back from the private sector to be his main contact with the civil service.

This has produced almost open conflict between "old" and the "new" contingents inside Downing Street. The "old" find a ready ear for their complaints in the House of Commons and among some ministers, including members of the Cabinet, who do not care for Carter and his managerial ways, particularly the occasion when he made them divide into groups of six or seven and set them problems to solve, in the sort of bonding exercise beloved of management consultants. The "new", with fewer allies in Parliament or Government, turned instead to the pages of PR Week, a magazine read by everyone in the world of public relations.

One issue included a complete diagram of the chain of command inside Downing Street, to illustrate how all Mr Brown's other advisers were subordinate to Carter – all except his veteran "gatekeeper" Sue Nye, who has served the Labour Party since it was led by James Callaghan. Another issue of PR Week, scandalously, implied that the new boys did not think much of Mr Brown's prowess as a public speaker, and accurately reported that speech writers who had worked for Tony Blair were being asked to return.

It is not quite the open warfare once conducted between the armies of Blair and Brown, but clearly it cannot go on. One comical side effect is that when PR Week comes off the press now, there is a queue of government messengers on motorbikes waiting to rush copies to Westminster, where people need to know the latest about what's happening in 10 Downing Street.

With the knives out for Carter, some people in Westminster are gleefully predicting that his time in Downing Street will be short. If the opinion polls do not improve, relations with a nervous Prime Minister could become steadily more difficult.

Other say he is not to be underestimated. "In any process of change you get one or two malcontents," a friend said. "But the great mistake is ever to believe that the malcontents represent the majority. I can tell you that Stephen is absolutely horrified by the leaks and briefings coming out of Downing Street and we will stop hearing them.

"After that, there will be more strategy, more traction in management across the departments. Stephen Carter is probably among the top 20 most able people of his generation. He is determined. He is ruthless where necessary, but he is a very decent person."

A Life in Brief

Born 1964, Scotland.

Education Currie High School, Edinburgh; University of Aberdeen, where he was student president 1985-86; London Business School.

Career Worked for J Walter Thompson advertising agency 1985-2000, rising to UK managing director, 1995, and UK chief executive 1997-2000. Director, NTL cable company, 2000-2002. In January 2003, appointed chief executive of the newly-created media regulator Ofcom. Stepped down in October 2006, when he was widely tipped to become head of ITV. Instead, he became chief executive of the Brunswick Group in January 2007. Since January 2008, he has been chief of strategy and principal adviser at 10 Downing Street.

He says "What I tell them is nine-tenths bullshit and one-tenth selected facts."

They Say "He is a very hard worker and works people hard. If there is any fault, it is that he drives himself too hard."- Lord Currie of Marylebone, chairman of Ofcom.