A new report from leading think tank IPPR has urged the UK and Scottish governments to work together to develop a new net zero deal “to keep North Sea oil and gas in the ground and invest in low-carbon industries to replace them.”
The Institute for Public Policy Research calls for the UK to move quickly to an economy “less dependent on extracting and burning fossil fuels.”
Such a move is essential, argue the authors, if the UK is to lead by the “power of our example” as host of the COP26 climate summit next year, and leverage greater action by other countries around the world.
The report, which follows the publication of the Prime Minister’s 10-point plan for a green industrial revolution, argues that “this is not about managing decline, but a managed transition – from reliance on fossil fuels to creating and expanding the industries and jobs of the future.”
The IPPR said: “As previous IPPR analysis has shown, a well-managed transition with investment in the low-carbon economy could create 1.6 million jobs, shared across the country, including 134,000 jobs in Scotland.”
About 260,000 jobs are linked to the oil and gas industries across the UK, including 230,000 in the on-shore supply chain, the report says.
“Many workers will need new skills for the industries that could replace them, and local communities – notably in north-east Scotland, but also elsewhere in the UK – will need support to prevent the risk of economic and social decline,” said the IPPR.
“New analysis by IPPR reveals the full extent of the jobs directly dependent on oil and gas industries in the Aberdeen area – more than 10 per cent of all jobs in the city itself, and 5 per cent in surrounding Aberdeenshire.
“The vast majority of people directly employed in the industry are in this area of Scotland.
“However, the report also notes that three fifths of all the jobs directly and indirectly related to the industry are outside Scotland, with London and the South-East accounting for one job in five.”
Russell Gunson, Director of IPPR Scotland, said: “Phasing out oil and gas will pose huge challenges for communities around Aberdeen and across Scotland.
“That’s why the UK and Scottish governments must work together to manage the transition, and create a plan for a Net Zero oil and gas sector, alongside local communities and workers in the industry.
“It is important, however, that the costs of transition are not devolved to Holyrood, after the proceeds of oil and gas have been reserved in Westminster.
“The UK government must commit to significant investment and ensure that cuts in oil and gas production are not imposed on Scotland.
“Together, we can help people and communities through the Covid-19 crisis and deliver a net-zero oil and gas sector that secures a stronger long-term future for workers, communities and the Scotland economy.”