Exclusive:John Swinney: Case for removing windfall tax 'absolute' as renewable growth not 'aggressive' enough
The First Minister says oil and gas is declining fast and renewables are ‘not growing at as aggressive a rate’ as hoped.
John Swinney says the case for removing the windfall tax is “absolute” because renewables are “not growing at as aggressive a rate” as had been anticipated.
The First Minister reiterated his call for the energy profits levy on oil and gas giants to be scrapped warning the level of economic damage is being accelerated by its continued presence.
Speaking to The Scotsman in Inverness, Mr Swinney said: “We’ve got to look at the crisis of employment that we face in the North Sea oil and gas sector.
“What’s happening just now is that oil and gas is declining at a more aggressive rate than we would have anticipated, and renewables are not growing at as aggressive a rate as we would have anticipated.
“In the interim, there is a loss of economic opportunity for people and a level of economic damage which I think is being accelerated by the presence of the energy profits levy.
“I think the case for it to be removed is absolute, to protect the economic wellbeing of Scotland and in doing so, any exploration of new developments has got to be compatible with our climate objectives - that’s obviously an additional consideration to be applied to such discussions.”
The energy profits levy imposes a tax of 38 per cent on profits made by oil and gas giants, and is set to remain in place until March 2030. It was initially introduced in response to soaring energy company profits following the Russian invasion of Ukraine.
This levy was introduced by former prime minister Rishi Sunak, and was then increased by the Labour government under Sir Keir Starmer.
Since the Conservatives were taken over by Kemi Badenoch, they have changed their stance and are now calling for the windfall tax to be removed to help with the cost-of-living crisis.
It comes after Mr Swinney appeared to soften his stance on new oil and gas drilling in the North Sea after oil prices soared due to the war in Iran.
In 2023 the SNP government set out a presumption against new oil and gas licenses, but since Mr Swinney took over as party leader he has refused to repeat this commitment.
He said energy security is now a “more significant” issue and that any proposed projects “must take into account the need for energy security for households and businesses in Scotland”.
The Liberal Democrats meanwhile have called for an immediate reduction in fuel duty to help cut prices for motorists at the pump. Scottish Liberal Democrat leader Alex Cole-Hamilton made the plea as the party outlined actions it would take to help “get Scotland moving again”.
His party insists a reduction in fuel duty – something only the UK Government could do – is needed following surging prices for petrol and diesel caused by the conflict in Iran. Mr Cole-Hamilton said: “Liberal Democrats are calling for an immediate cut in fuel duty to bring down prices at the pump.”
His plea came as he outlined a number of measures his party wants introduced to help tackle “dangerous” roads. The party wants a new, dangerous roads programme developed, based on data from traffic accidents, with a coding system that could then be used to trigger actions such as the use of road policing cameras, changes to the speed limit, resurfacing work, improved lighting, or even considering creating new bypasses or dual carriageways.
Liberal Democrats also want to see work to dual the A9 road, between Perth and Inverness, speeded up, and say they would develop a timetable for dualling the A96 – which runs from Aberdeen to Inverness – within 100 days should they win the May 7 Holyrood election. The party is also backing the use of speed awareness courses for motorists caught breaching the speed limit, as a means of reducing such behaviour. Mr Cole-Hamilton spoke out on the issues as he visited the Knockhill race track in Fife, saying it was “time to fix the damn roads and get Scotland moving again”.
He stated: “It has been 19 years since the SNP came to power with big promises of smooth shiny roads – now people are fed up of waiting.
“Under the SNP, Scotland’s roads are in a terrible state and the dualling of crucial trunk roads is miles behind schedule.
“Just like the ferries, they have become a symbol of how our infrastructure has been neglected under the SNP. These are basic things that people expect the Government to get right.
“Scottish Liberal Democrats have a realistic plan to get Scotland moving again. By improving core connections, driving progress on major projects such as dualling the A9 and tunnels for Shetland, we will boost regional development and rejuvenate our economy.”
The Scottish Tories, meanwhile, accused of SNP of wasting £6.2 billion of taxpayers’ cash in the last five years.
Tory leader Russell Findlay accused the Scottish Government of “idiotic and epic incompetence”. He pointed to a reported £1.8 billion in costs incurred through the failure of ministers to eradicate delayed discharge in hospitals, as well as the £1 billion being spent on a new Glasgow prison originally costed at £100 million. Mr Findlay also criticised the Government over the ballooning costs of two ferries built at Ferguson Marine, which have seen costs surge to about £460 million. The Scottish Government also came under fire over its record of defending itself in court, with the Tories saying £1 million was spent defending gender self-ID plans.
Among its figures, the party also includes the reported £2.7 million cost of the Operation Branchform police investigation into the SNP’s finances, £400,000 on lifting the ministerial pay freeze, and £60,000 on Police Scotland’s Hate Monster campaign, among a host of others.
Mr Findlay said SNP “incompetence” had, in effect, amounted to wasted spending to the tune of £6.2 billion.
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