Britain risks losing more skilled North Sea workers before emerging energy industries can replace declining oil and gas activity, the North Sea Transition Taskforce has warned. It says the impact is particularly acute in north-east Scotland, where around one in four working people is employed in or supports the offshore energy industry.
The taskforce’s North Sea Transition Taskforce: One Year On report acknowledges progress, including through the UK Government’s North Sea Future Plan. But it argues that oil and gas activity is shrinking faster than offshore wind, carbon capture, hydrogen and other new industries are growing.
The group, backed by the British Chambers of Commerce and Aberdeen & Grampian Chamber of Commerce, puts UK oil and gas employment at 115,000 direct and supply-chain jobs. It says 25,000 jobs have been lost since the last election.
Philip Rycroft, chair of the taskforce, said: “The fundamental problem is that the traditional energy economy is declining faster than the new one is being built. If we allow that gap to widen further, we will lose skilled people, businesses and infrastructure which cannot simply be recreated when new industries are ready to expand at scale.”
The taskforce wants the UK Government to replace the Energy Profits Levy with the Oil and Gas Revenue Levy from 2027-28 rather than 2030. It argues that bringing the change forward would provide greater certainty for investment and slow job losses.
Industry analysis cited by the taskforce suggests the change could unlock up to £50 billion of additional private investment and more than £13 billion in tax revenues over the following decade. The group also argues that continued domestic production would help retain the workers, infrastructure and supply-chain businesses needed as new energy industries develop.
Russell Borthwick, chief executive of Aberdeen & Grampian Chamber of Commerce, said: “For the North-east of Scotland, this isn’t an abstract debate about what our energy system might look like in 20 years. Jobs and investment are being lost right now.
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“One in four working people in our region depends on the offshore energy industry and around 80% of that activity is still rooted in oil and gas. The renewable jobs we all want to see simply aren’t arriving quickly enough or at sufficient scale to replace what is being lost.”
The taskforce also calls on the Scottish Government to finalise its Energy Strategy and Just Transition Plan. It wants the north-east’s economic and skills strategies brought together into a single pathway. There are many amongst the business community who feel that the respective Chambers of Commerce have led the fight to save the oil and gas industry whilst the Scottish Government in particular ignored the huge economic and social importance of the industry. This latest initiative is the latest in a long line of appeals to government both North and South of the Border.
