Jeremy Hunt: Cuts to red tape are needed to stimulate growth

Jeremy Hunt will on Friday make a "case for optimism" and say it is time to stop talking Britain down.

In a speech setting out his long-term vision on the economy, seen by the Daily Mail, the Chancellor will pledge to transform "British genius and hard work" into long-term prosperity, hitting out at the "declinism" of Labour.

Gloomy predictions from forecasters "do not reflect the whole picture", he will say, arguing that the economy is standing up well against global rivals.

Mr Hunt reportedly told a Cabinet "awayday" at Chequers on Thursday that the Government could meet the Prime Minister's targets of halving inflation, kick-starting growth and reining in debt.

He will insist he sticks to the £35 billion of spending cuts unveiled in his Autumn Statement last year, and reject calls from some Tory MPs to bring forward tax cuts.

The Chancellor will also warn government officials that cuts to red tape will be needed to help the British economy return to growth.

Tough decisions on public spending will be needed, he will say, as he demands departments reduce waste and inefficiencies.

And he will say it is vital that the Government continues to resist inflation-busting public sector pay rises – as this will embed high prices into the economy and prolong the pain for everyone.

It was announced on Thursday that the former chair of the Government's Covid vaccine taskforce has been appointed to the board of a new innovation agency aimed at finding high-tech breakthroughs.

Dame Kate Bingham, who headed up the official efforts to identify and rapidly deploy a vaccine for coronavirus, is among the board members of the £800 million Advanced Research & Invention Agency.

Mr Hunt launched an efficiencies and savings review in the Autumn Statement last November.

All departments have been told to identify savings to ensure public spending can go further.

In his Autumn Statement, Mr Hunt said: “We want low taxes and sound money. But sound money has to come first, because inflation eats away at the pound in people’s pockets even more insidiously than taxes.”

It is understood that the Chancellor will use Friday’s speech to indicate that he does not intend to deviate from this path.

Mr Hunt will attempt to set the scene for March’s Budget, saying the UK has fundamental strengths in high-growth sectors such as digital technology, life sciences, green industries, the creative sector and advanced manufacturing.

As part of the Autumn Statement, the Chancellor commissioned Sir Patrick Vallance, the UK’s chief scientific adviser, to review the regulatory framework – including EU laws – in order to maximise growth and investment.

Mr Hunt is looking at all options, including through the Retained EU Law Bill.

The Chancellor has already published plans to reform Solvency II – an EU-derived rule for British insurers that limits how much they can invest – which the Association of British Insurers say could unlock £100 billion of private investment this decade into UK infrastructure and clean energy, such as nuclear power.

Mr Hunt will argue that this is solid proof that regulatory reform can promote growth.

On Thursday, Rishi Sunak held an away day with Cabinet ministers at his Chequers country retreat.

It is understood that Mr Hunt gave a presentation on how it was necessary to get inflation under control to avoid the Bank of England having to put up interest rates.

Mel Stride, the Work and Pensions Secretary, used his slot to lay out the scale of Britain's inactivity problem and its key drivers.

He confirmed he is targeting students, the long-term sick and disabled, carers and the over-50s to try to get them to return to work.

Mr Stride made the point that a cross-government approach will be needed to deal with the problem, with the health, education and business departments told they will have to take action to reduce the scale of the problem.

Listen Chancellor Jeremy Hunt join Christopher Hope on Chopper's Politics, The Telegraph's weekly political podcast, using the audio player in this article or on Apple Podcasts, Spotify or your favourite podcast app.