There is a temptation as I write this to suggest some ‘New Year’s Resolutions’ for the UK Government and their approach to the energy industry next year, but I wouldn’t want to add to their list of promises they don’t intend on keeping.
It would be ignorant to imply finally giving the North Sea oil and gas industry some much needed support can wait until January 1st 2016.
The fact of the matter is, this past year has been one in which the UK Government has already spent too much time putting off addressing the challenges in the oil and gas sector by making naïvely jubilant remarks about the positives of low petrol prices. It’s patronising politics at best, and blatant ignorance at worst.
The oil and industry is not a political trophy to be held to ransom at the whim of a Chancellor looking to gain popularity through low petrol prices. We are talking about a sector which supports hundreds of thousands of jobs across the UK, and has paid more than £300 billion in tax revenues.
But the case for galvanising the industry goes far beyond the financial gain; it really comes down to the people who work in it.
Since the price of oil started to fall last year it has been incredible to watch individuals and businesses within the sector rising to the enormous challenges before them and immediately role out strategies to cope with high cost exploration and pressing on with major projects, despite what is clearly now a far more testing market to work in.
If the Westminster Government had followed the example set by those who actually work in energy industries, it is likely we would have much stronger home grown businesses across the North East of Scotland and the rest of the UK.
Back in March George Osborne eventually got round to making cuts to the tax rate on oil and gas production, and those changes were widely welcomed.
However, in the nine months since that announcement was made there have been two budget statements and not a word or action of support for the industry.
New Year is a time for a new approach to the mature oil fields of the North Sea and I will continue to press the Chancellor on the pertinent need for exploration incentives for the industry, so that companies can get as much out of offshore assets as is physically possible.
Continuing to deny these well-deserved incentives defies logic, as even the UK Government knows boosts in activity result in higher income from taxation.
In further baffling cuts, the Autumn Statement came with the news of the drastic cancellation of £1billion ring fenced to develop carbon capture and storage (CCS), of which Peterhead power station was one of only two bidders for.
This would have allowed the North East to be at the forefront of yet another energy revolution, allowing us to meet our carbon reduction targets in the cheapest and least disruptive manner possible.
The potential of CCS to boost oil production and therefore increase taxation seems to have been lost on the Treasury, which is so often penny wise but pound foolish.
The Scottish Government’s approach has been a different story, as way back in January they established an Energy Jobs Taskforce to support the oil and gas sector, specifically focusing on jobs in the sector.
The First Minister of Scotland announced guarantee employment or further training for Modern Apprentices (MAs) facing redundancy, and further support for oil and gas companies to partake in the Adopt an Apprentice programme which re-employs MAs who have been made redundant.
Another positive take away from this year has been the establishing of the Oil and Gas Authority, who I will continue to engage with, and will encourage the UK Government to listen very closely to. In Aberdeen it is well understood that the oil and gas industry is complex and best understood by those who work in it.
I frequently hear from constituents working across different divisions of the sector both on and offshore, and this year there has been plenty of issues for us to discuss.
2015 has continued the legacy of 2014 in that people are more engaged in politics than ever before and have high expectations from the people elected to serve them.
I will continue to push the government to provide better support to the energy sector, and treat the economies of the North Sea and the North East of Scotland with the respect they deserve.
Callum McCaig is the Scottish National Party’s MP for Aberdeen South.
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