A key business group in the North East of Scotland says Aberdeen should be ‘first in the queue’ for investment zone status - and has warned that the UK Government needs to act to protect the region’s oil and gas industry.
Ryan Crighton, policy director at Aberdeen & Grampian Chamber of Commerce, says the windfall tax on the sector has had a negative impact and is placing major investments at risk.
Now he is urging the UK government to act to support the sector and the tens of thousands it employs. That includes support for the Aberdeenshire-based Acorn carbon capture and storage (CCS) project.
He said: “We welcome the £20bn funding for the development of carbon capture projects – and the Acorn Project on the Buchan coast must be one of the beneficiaries of this additional investment if we are to transform our region into the net zero capital of Europe.
READ MORE: Budget 2023 - Scottish businesses react
“Aberdeen should also be first in the queue for the Scottish Investment Zone proposed today. This region has proven time and time again that it can work with government and academia to tackle the big challenges facing the UK.
“The commitment to making the UK as attractive as possible for the life sciences sector, one of growing importance to this region’s economy, is another positive step.
“However, after months of campaigning and lobbying, the Chancellor is yet to recognise the corrosive impact the windfall tax has had on jobs and investment in the North Sea.
“The energy profits levy, as it stands, is a tax too far - and his failure today to implement a price floor continues to place major investments at risk.
“The government says it will set out further action later this month to ensure energy security in the UK – that action must reflect the explicit warnings coming from industry right now.
“Shell has described the US as a more attractive investment, Harbour Energy is cutting jobs after its UK profits were wiped out by the windfall tax, and one of the North Sea’s biggest fields, Ninian, is being decommissioned due to the tough fiscal environment.
“Our political leaders must wake-up to the damage being done to an industry which supports 200,000 before it is too late.”
Mr Crighton added: “It was billed as a budget for growth, which is at odds with increasing corporation tax as businesses recover from the pandemic. However, the introduction of full capital expensing will unleash up to £9billion of investment across the economy per year, as will R&D tax credits.
“Efforts to encourage more people back into the UK workforce will also be helpful in tackling the labour shortages which are holding back so many of our members. The decision today to ease visa rules for the construction sector shows that the government can be flexible in its immigration policy where issues are identified – we need to see this extended further to cover the many other sectors experiencing shortages.”
