First Minister John Swinney has warned that major parts of Scotland’s economy are facing an existential threat unless the UK Government changes course and delivers immediate support for the energy sector.
The First Minister raised the concerns directly with Prime Minister Sir Keir Starmer ahead of the British Irish Council summit in Wales, urging action to prevent what he described as irreversible deindustrialisation in some of Scotland’s most economically significant regions.
At the centre of the discussions was the Energy Profits Levy, which the Scottish Government has long argued is undermining investment, damaging confidence and placing thousands of skilled jobs at risk during the transition from oil and gas to renewable energy.
The First Minister said the combination of the levy, the impact of the recent UK Budget and continued uncertainty over key infrastructure sites such as Grangemouth, Mossmorran and the Acorn carbon capture project places the Scottish economy at a critical juncture.
The conversation also covered the future of UK US trade negotiations, with the First Minister pressing for clarity on progress and stressing the urgent need for Scotland’s whisky sector to secure tariff exemptions vital for the industry’s long term stability.
Following the meeting, First Minister John Swinney said:
“I was clear with the Prime Minister act now or run the risk of delivering irreversible deindustrialisation and decline in Scotland’s economy.
“The energy industry is facing an existential threat unless it gets the support it needs from the UK Government including removing the Energy Profits Levy to help ensure there is a just transition from oil and gas to renewables that protects skills and delivers a pipeline of future investment.
“We have a moral obligation to deliver on our climate commitments but must ensure we do not leave communities behind.
“Scotland still suffers the scars of deindustrialisation from previous UK Governments and unless there is action now from UK Ministers, we run the risk of repeating the mistakes of the past.
“I also pressed the Prime Minister for an update on the UK-US trade negotiations specifically whisky and reinforced my determination to ensure there is mutually beneficial deal for Scotland.
“This follows my earlier discussions with President Trump about the tariffs impacting Scotch whisky and the symbiotic partnership which exists between the Scotch and US whisky industries.
“Scotland’s whisky industry is a cornerstone of our economy and without those trade exemptions, which are for the UK Government to secure the industry will not have the protection and support it needs.
“It is in the economic interest of both Scotland and the US to reduce tariffs for Scotch whisky.
“Scotland’s economy is at its best when we focus on securing investment in the jobs and industries of tomorrow.
“That ambition is matched by our commitment to ensuring we do not repeat the mistakes of the past, a commitment I pressed the Prime Minister to follow.”
The First Minister also welcomed the UK Government’s commitment to remove the two child cap, calling it a vital step that will support the Scottish Government’s wider efforts to tackle child poverty.
The meeting concluded with a renewed call for collaboration but also a firm message that Scotland cannot afford indecision at a moment when skills, communities and major industries face profound challenges and opportunities.
