Business chiefs in the north-east have written to Sir Keir Starmer in “anger and frustration” as they plead with him to abandon his controversial windfall tax proposals.
The Labour leader’s plan to extend and increase the levy on oil and gas firms has been met with a furious backlash in the north-east over fears it could spell major job losses.
More than 700 concerned voices, including Aberdeen business tycoon Sir Ian Wood, have signed the letter to Sir Keir demanding a U-turn.
The Labour chief wants to increase the windfall tax on excess profits made by multinational companies in the North Sea from 75% to 78%, extending it to at least 2029.
© AJL/ Kami ThomsonIt’s hoped this would bring in more than £10 billion to the treasury.
But analysts have warned it could cost the UK £20 billion by deterring investment, potentially leading to 100,000 job losses in a worst-case scenario.
The controversial policy comes shortly after Labour also abandoned a pledge to spend £28 billion per year on green energy jobs.
Aberdeen and Grampian’s Chamber of Commerce claimed Labour’s energy strategy risks “undermining the energy transition” from fossil fuels to renewables.
© Ross Johnston/ Newsline MediaPolicy director Ryan Crighton said: “Almost 800 people have signed this letter in under 24-hours, which shows just how badly Labour’s proposals have gone down in the north-east.
“The signatories to this letter are not just energy businesses, they are charities, education institutions, house builders, professional services firms – this list goes on.
“People and businesses are rightly worried about the impact this policy will have on our region, should Labour form the UK government, because it impacts our entire economy.”
‘Sadness, frustration and anger’
The letter reads: “The way this and previous North Sea policies have been announced, without any consultation, is regrettable.
“We cannot overstate the mixture of sadness, frustration and anger – throughout and beyond the energy sector – which has resulted from your announcement.
“We urge you to return to the north-east and re-write your policy in partnership with the people, communities and companies you want to finance and deliver it.”
The damning letter heaps further pressure on Sir Keir and Anas Sarwar over energy policy ahead of Labour’s party conference in Glasgow this weekend.
The party has insisted money will still be invested in green jobs, and a publicly owned energy company is to be based in Scotland.
Ahead of the conference, Labour bosses have emphasised they have no plans to “turn off the taps” on drilling.
© DCT MediaAberdeen Councillor Barney Crockett, a former local Labour leader, quit the party last June in protest against their strategy.
SNP Westminster chief Stephen Flynn, an Aberdeen MP, warned the proposals would be a “level of de-industrialisation that Margaret Thatcher could only dream of”.
That’s despite the fact the SNP has previously shown strong support for the windfall tax, first introduced by then Chancellor Rishi Sunak in 2022.
The Conservatives were initially opposed to the levy, but relented as consumers struggling to pay soaring energy bills.
Labour’s shadow secretary Ian Murray said: “Labour’s plans will ensure oil and gas giants making eye-watering profits from the cost of living crisis pay their fair share towards the delivery of cleaner and cheaper energy.
“Jobs are at the heart of Labour’s Green Prosperity Plan – we will not only protect existing jobs in the North East but will bring the jobs of the future to the region.”
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