The air in London’s financial district has a certain weight to it these days, a mix of damp mist and palpable unease. In my two decades covering corporate boardrooms and market swings, I’ve heard frustration before. But the recent declaration from Jim Johnson, chief executive of the storied FTSE-listed firm Hunting, landed with a finality that cuts deeper than the usual grumbling. When the boss of a 150-year-old British industrial pillar says the UK has become “less investable than Venezuela” and will never see another penny of his company’s capital, you don’t just note it down. You feel the tectonic plates of business confidence shifting.
Hunting’s story is Britain’s story. Founded in 1874 as a shipping concern, it literally helped build the nation’s defenses, crafting fuselages for the Lancaster bombers that flew during the Second World War. Today, it’s a leader in advanced engineering, making the critical high-pressure pipes that fuel both offshore energy projects and modern aerospace. This is a company woven into the industrial fabric. And now, it is retreating. Last year, it shut 80% of its UK operations, shed dozens of staff, and consolidated its British presence to little more than a London head office. The reason, according to Johnson, is not market forces or a lack of innovation. It’s politics.
“The reality is that Britain has become uninvestable,” Johnson stated. “Everything your politicians have done has shown me that we cannot trust them.” For an analyst, this sentiment is a chilling data point. It translates the abstract concept of “policy risk” into the concrete reality of shuttered facilities and relocated investment. The core of his grievance lies in what the industry sees as a punitive and unpredictable fiscal regime. The Energy Profits Levy – the windfall tax – begun under former Chancellor Rishi Sunak at 25% and since raised to 38%, was already a point of severe contention. The current Labour government’s increase of the total effective tax rate on oil and gas profits to 78% was, for many executives, the final straw.
But it’s not just the tax rate itself; it’s the volatility. As the Institute for Fiscal Studies has repeatedly warned, frequent, major fiscal shocks undermine long-term planning. An oil field is not a tech startup. It requires decades-long horizons and capital commitments that can stretch into the billions. Johnson highlights the plight of the Rosebank and Jackdaw fields, discoveries made over twenty years ago, which still languish in regulatory and political limbo. “If you’re an oil company, are you willing to drill and spend money, knowing 20 years from now you might also never see a dime of returns?” he asks. It’s a rhetorical question with a very clear answer echoing across executive suites.
This policy environment exists alongside the de facto ban on new drilling licenses, a legacy of Ed Miliband’s tenure as energy secretary. The stated aim is a transition to net zero, a goal shared by much of the industry. However, the practical effect, as reported by Offshore Energies UK, has been to accelerate the decline of domestic production, increase reliance on often carbon-intensive imports, and scare off the very investment needed to fund that transition. The recent tensions in the Middle East, underscoring the fragility of global energy supplies, have placed Prime Minister Keir Starmer in a difficult position, forcing a reassessment of energy security. But for investors like Johnson, the damage to trust may already be irreversible.
He draws a stark contrast with Norway. “The contrast I draw is with Norway, which loves oil and gas. They understand the impact it has on the nation’s treasury,” he says. Norway’s sovereign wealth fund, now valued at over $1.6 trillion, is the direct result of stable, long-term policies that encouraged development while saving proceeds for the future. The UK’s approach, by comparison, is viewed as short-term and politically reactive – taxing what is seen as a legacy industry to fund current needs, while discouraging the investment that could secure its future revenue or its energy independence.
| Factor | UK | Norway |
|---|---|---|
| Sovereign Wealth Fund | N/A | $1.6 trillion |
| Tax Rate on Oil & Gas | 78% | Stable |
| Investment Climate | Unstable | Attractive |
| Policy Approach | Reactive | Proactive |
| Oil & Gas Industry Stance | Discouraging | Supportive |
| Future Revenue Perspective | Uncertain | Promising |
The implications extend far beyond the North Sea. When a flagship engineering company like Hunting declares the UK “uninvestable,” it sends a signal to every sector wrestling with regulatory uncertainty, from life sciences to finance. It tells global capital that Britain’s political climate may now outweigh its historical strengths of rule of law and market openness. Andy Burnham’s ambitions for a northern industrial renaissance, as cited by Johnson, are seen as doomed without a foundational change in this climate.
- Frustration in corporate boardrooms
- Hunting’s 150-year legacy
- The impact of policy instability
- Comparative analysis with Norway
- Implications for UK investment climate
- Global capital’s perception of risk
My own reporting confirms this isn’t an isolated rant. Quiet conversations with asset managers and corporate treasurers reveal a growing consensus: the UK’s risk premium has risen. The numbers bear it out. The Office for National Statistics shows a persistent weakness in business investment growth compared to other G7 nations. The International Monetary Fund, in its latest Article IV consultation on the UK, explicitly cited “policy uncertainty” as a drag on investment.
Hunting’s pullback is a symptom of a broader economic ailment. It represents a failure of policy sequencing and communication, where necessary environmental goals have been pursued in a manner that actively dismantles industrial capacity and investor faith. The company isn’t giving up on energy; it’s simply taking its engineering prowess and capital elsewhere. The tragedy is that the expertise that built the Lancaster bomber and taps energy reserves miles under the sea is being told, through policy, that it is no longer valued at home. For a nation that once led the industrial world, that’s more than a business story. It’s a warning written in closed factories and cancelled projects, a stark memo on the real-world cost of “crazy” politics. The question now is whether anyone in Whitehall is still reading.
