North Sea Oil and Gas Licences: Economic Growth

1. What assessment he has made of the potential impact of not issuing new North sea oil and gas licences on levels of economic growth in Scotland.

This is the first opportunity I have had to apologise to the House for using an inaccurate figure on previous occasions. I had told the House that the Scottish Government had received a record settlement of £47.7 billion this year, but Treasury figures show that the block grant for this year is actually £50 billion. That is the highest ever settlement in the history of devolution, with bells on. That £50 billion is more money for schools, hospitals, policing and housing; it is an end to austerity. That is the Barnett formula in action—the formula that both the SNP and Reform have announced this week that they want to scrap.

Oil and gas will remain a crucial component of our energy mix for decades to come. Our workforce is the most talented in the world, and we are committed to ensuring its future. We have consulted on support for the energy transition in the North sea, including on these issues, and the Secretary of State for Energy Security and Net Zero will respond to that consultation shortly. Economic growth in the UK in the first quarter of the year beat all forecasts, reaching 0.7%—the highest in the G7. Growth in Scotland is more sluggish than in the rest of the UK; if Scotland’s economy had grown at even the low rate at which it grew under the Tories, it would be £10 billion larger. That makes it even more astonishing that the Opposition parties oppose the EU, US and India trade deals.

Ministers across various Departments have repeatedly said that oil and gas is here to stay for many years. Issuing new North sea oil and gas licences would support tens of thousands of jobs, return millions in tax revenue to the Treasury and help to grow the Scottish economy. Why are the Government refusing to issue any new licences?

A consultation on Rosebank and Jackdaw is concluding, and the Secretary of State for Energy Security and Net Zero will report on it in due course. There is also the North sea transition consultation, which has concluded, as I mentioned earlier, and which will take into account all those issues. It will be published in due course.

Labour’s windfall tax on North sea energy profits is designed to make us less reliant on people like Vladimir Putin. When I was campaigning in Hamilton last week, voters asked me why the SNP, the Tories and Reform were so against our windfall tax. I could not explain. Can the Secretary of State?

I am grateful to my hon. Friend for the question. What astonishes me more than anything is that the shadow Secretary of State for Scotland was the Energy Minister when the energy profits levy was brought in.

The hon. Gentleman shakes his head, but he was the Energy Minister. Indeed, as my hon. Friend the Member for Edinburgh South West (Dr Arthur) may remember, the leader of the SNP in Westminster, the right hon. Member for Aberdeen South (Stephen Flynn), did not support the levy, then did, then did not, and then put in the SNP’s manifesto that it would be extended to every single Scottish industry. I am at a loss, as is my hon. Friend.

We come to the shadow Secretary of State.

I start by congratulating the famous Aberdeen football club—the only team in red I like to see winning—and the manager Jimmy Thelin, the players and all the coaching staff for winning their eighth Scottish cup a week and a half ago, qualifying for the Europa league in the process. The pride and jubilation on the streets of Aberdeen last Sunday show just how much the club means to the north-east of Scotland. Even more important to the north-east than Aberdeen football club is the oil and gas industry. What does the Secretary of State make of the report published by Robert Gordon University this week that warns of 400 job losses every two weeks in the North sea?

I join the shadow Secretary of State in congratulating—through gritted teeth—Aberdeen on winning the Scottish cup. Speaking as a big Hearts fan, it is always nice to see the smaller clubs doing well in national competitions. [Interruption.] I do not know whether I have lost or won the House there, Mr Speaker.

We have this discussion across the Dispatch Box a lot during questions. We are aiming for clean energy by 2030, and setting up GB Energy in Aberdeen—something that the shadow Secretary of State voted against, of course—to ensure a transition. We have a declining and mature base, and we need to create the jobs of the future and the future industries in Scotland. He should support that, rather than voting against it. The EPL was brought in by his Government.

To be absolutely clear, there is no transition under way. It is not the Conservative party saying that; it is the Robert Gordon University Energy Transition Institute. These mythical jobs in renewable energy simply do not exist yet. There is a slowdown in offshore wind deployment and a steep decline in offshore oil and gas activity as a direct result of Labour’s ideological policies—400 job losses every two weeks, a steep decline in skilled roles, nowhere for supply chain jobs to go but overseas, and a decline in the workforce of 25%. Why? Because of massive investor uncertainty due to negative sentiment around oil and gas as a result of the ban on licences and the EPL extension. When will the Secretary of State and the Scottish Labour party grow a backbone, stand up to the Secretary of State for Energy Security and Net Zero, and stand up for Scotland and Scottish workers?

I do not know whether the hon. Member agrees with net zero anymore—certainly, his party leader does not seem to believe in it—but that is where the jobs are for the future. There is a declining base in the North sea. Companies are making that transition already, and we need to ensure pace; that is the big issue. We need regulatory change and investment, and GB Energy is there to ensure that. The National Wealth Fund is making investments as well. We have seen £600 million invested in Scottish Power’s infrastructure. Things are starting to happen, but we need cross-party support on this.