Rishi Sunak has urged Rachel Reeves to go further and faster on deregulation to revive growth, as eight former UK energy ministers call on the government to rethink its stance on North Sea oil and gas.
The former prime minister wrote in a Sunday Times column that Reeves deserved credit for delivering a Spring Statement free from the “orgy of speculation” that preceded her earlier fiscal events.
By restoring fiscal headroom, she has steadied markets and avoided weeks of destabilising tax leak chatter. However, he warned that caution alone will not be enough.
With Labour backbench resistance limiting the scope for spending restraint or tax reform, Sunak argued that deregulation is the “most obvious” lever left to pull.
Reeves has already told regulators to prioritise growth, but he cautioned against pretending reform is simply about cutting red tape.
“Regulation is a trade-off between pro-growth market efficiency and protecting things that the market alone would not,” he wrote.
“We need to be honest and state clearly that proper deregulation will require some difficult choices.”
Sunak singled out environmental rules and planning constraints, saying that the balance has tilted too far towards caution, weighing on housebuilding and infrastructure delivery at a time when economic momentum remains fragile.
Former energy ministers urge oil and gas rethink
Sunak’s intervention coincides with mounting pressure on the government’s energy policy.
A cross-party group of eight former energy ministers, including former Conservative energy secretary Amber Rudd and former Labour business and energy secretary Lord John Hutton, has written to Keir Starmer warning that current restrictions on North Sea production are worsening energy security.
They argue that the decline in domestic oil and gas output is driven more by policy than geology, and have urged ministers to end the energy profits levy sooner and lift the ban on new exploration licences.
The group also wants approval granted to the Rosebank and Jackdaw oil and gasfields, developments previously supported by the Conservatives but later blocked following legal challenges over climate impact assessments.
Former Tory energy minister Charles Hendry told the Financial Times that restricting new drilling would “only increase our energy imports”, despite the UK still relying on oil and gas for around 75 per cent of its total energy needs.
Labour ministers maintain that the North Sea is in long-term decline and that future security lies in accelerating renewables and carbon capture.
Ed Miliband has said expanding drilling would not materially reduce household bills because prices are set on global markets.
However, tighter licensing rules and extended windfall taxes risk deterring investment, increasing import dependence and undermining jobs in energy-producing regions.
