Labour is on collision course with one of its biggest union backers after the GMB warned that the "rushed and needless" rundown of North Sea oil and gas is having a devastating impact on Aberdeen.
Louise Gilmour, Scotland Secretary of the GMB, has launched her strongest criticism yet of the UK Government’s approach to energy transition, accusing ministers of presiding over what she describes as “arguably the most destructive industrial calamity in our nation’s history”.
She also criticises the Scottish Government for opposing nuclear energy in a new report by the Jobs Foundation, Cliff Edge, which warns that the UK will permanently lose energy independence without a major change in government policy.
The report claims around 200 jobs per week are being lost as a result of the ban on new North Sea exploration and the impact of high taxation, including the Energy Profits Levy (EPL). In some cases, oil and gas companies are reported to be paying tax rates of up to 120% on profits.
'Delusional'
In the foreword to the report, Ms Gilmour writes: “Our governments seem stricken, almost delusional, in the face of onrushing disaster, insisting we must ignore today’s reality and believe in tomorrow’s dreams as arguably the most destructive industrial calamity in our nation’s history – a disaster risking untold jobs, communities, even higher bills, and our energy security – unfolds.”
According to the report, investors are increasingly viewing the UK as an unstable environment, with one executive suggesting investment would be safer “somewhere more stable, like Nigeria”.
The GMB, which donates around £1m a year to Labour and represents around 560,000 members, has previously raised concerns over the pace of the transition but this intervention marks its most scathing critique of the UK Government to date.
Ms Gilmour argues that oil and gas will still be required “for years, decades” as renewables capacity is scaled up, and that the need to protect energy security and jobs “could not be clearer or more obvious”.
The oil and gas sector currently employs around 115,000 people across the UK, with a further 90,000 jobs supported across the wider economy. The Jobs Foundation warns employment in the sector could fall to 57,000 by the early 2030s, with particularly severe consequences for regions such as Aberdeen.
Coal mine comparisons
Ms Gilmour compares the potential impact on communities to the closure of coal mines in the 1980s, warning that promises of a “just transition” are not matching reality on the ground.
She concludes: “We do not need more fantastic forecasts but just one actual industrial strategy underpinned by realism, ambition, financial support and a bedrock of confidence in our workers and their capabilities.”
The Jobs Foundation was set up by the lobbyist and Tory peer Lord Matthew Elliott and Georgiana Bristol in 2023 to champion the role of business as a force for good.
Its report, written by the charity’s research director Nick Tyrone, argues the energy sector “stands on a cliff edge”, adding: “We are running out of time to save the energy sector – in Aberdeen, in Scotland, in the United Kingdom.”
Recommendations
The report calls for four urgent policy shifts:
- Grant New Licenses: Resume granting licenses for North Sea exploration to ensure energy independence and protect jobs.
- Create a Real Plan: Abandon "magical thinking" and develop a concrete industrial strategy for the transition.
- End the EPL: Scrap the "windfall tax" immediately or by 2028 at the latest to restore investment confidence.
- Focus on Aberdeen: Recognise that energy jobs will not "magically" stay in the city without direct intervention.
Georgiana Bristol, CEO of the Jobs Foundation, said: "The future is Britain's to decide. Do we want to live in a country in which we are reliant on high cost, high carbon footprint energy sources... or do we want to regain energy independence for Britain?".
A spokesperson for the UK Department for Energy Security and Net Zero said: “Issuing new licences to explore new fields will not take a penny off bills, cannot make us energy secure, and will only accelerate the worsening climate crisis.
“We have set out a plan to build a prosperous and sustainable future for the North Sea, backed by record investment to grow clean energy industries, support the management of existing oil and gas fields for their lifespan and deliver the next generation of good jobs for North Sea workers.”
Click here to read the full report.