Prime Minister Sir Keir Starmer, along with the chancellor and business secretary, has reached out to the UK’s primary regulatory bodies, urging them to propose reforms aimed at boosting economic growth. In letters sent to key regulators such as Ofgem (energy) and Ofwat (water) before Christmas, the government requested actionable ideas by mid-January.
This initiative follows recent data showing that the UK economy stagnated between July and September, fueling concerns over growth prospects.
Shadow Business Secretary Andrew Griffith criticized the move, claiming it reveals a lack of direction within Starmer’s government. He argued that the prime minister is “begging his own administration” to deliver growth after what he described as a damaging Labour Budget.
The letter, also sent to the Environment Agency, the Financial Conduct Authority (FCA), and healthcare regulators, was first reported by Sky News. Signed by Chancellor Rachel Reeves and Business Secretary Jonathan Reynolds, it emphasized the importance of collaboration between the government and regulators to create a “pro-growth and pro-investment” regulatory environment while maintaining their independence.
The FCA confirmed it would respond in the new year, highlighting measures it has already implemented, including reforms to retail investor information and proposals to enhance value for workplace pensions.
The government’s letter stressed that regulatory improvements are critical to its mission to stimulate economic growth and encourage investment.
Economic growth has been a central theme of Labour’s policy initiatives, with reforms ranging from planning system changes to increase housebuilding to encouraging financial services firms to take “sensible risks.”
The letter underscores Starmer’s determination to use every available tool to align regulators and government departments with Labour’s ambition of achieving the highest sustained economic growth among G7 nations. It also reflects concerns that regulators may unintentionally hinder growth by creating barriers to business activity—a stance often associated with Conservative rhetoric but now central to Starmer’s strategy.
In a recent speech, Starmer criticized “regulators, blockers, and bureaucrats” as part of an “alliance of naysayers” that obstructs progress. At an investor summit in October, he pledged to eliminate unnecessary regulations that deter investment.
However, critics argue that many regulations viewed as obstacles are, in fact, essential safeguards. Griffith, a Conservative MP, claimed the UK experienced faster growth under Conservative leadership before the last election and accused Labour of failing to deliver results.
Starmer has acknowledged the challenge of improving living standards and cautioned that progress will take time. Chancellor Reeves also highlighted the scale of rebuilding the economy after what she described as “15 years of neglect.” Meanwhile, opposition figures like Shadow Chancellor Mel Stride blamed Labour for declining growth, further fueling political tensions over the economy’s trajectory.