How The Future Of North Sea Oil Turned Into A Massive Headache For Keir Starmer

"We could lose the election over own goals like this," said one Labour insider.
Anas Sarwar was left "very frustrated" by UK Labour
Anas Sarwar was left "very frustrated" by UK Labour
Damon Scheleur/HuffPost

All eyes will be on Keir Starmer when he makes his big speech setting out how a Labour government would deliver his mission to turn Britain into “a green energy superpower”.

The set-piece event had been due to take place this coming Monday, but HuffPost UK understands it has been put back by a week.

Fittingly, Starmer will deliver the speech in Scotland, where tens of thousands of jobs rely on North Sea oil and gas, a key industry which will be directly affected by the transition away from fossil fuels.

Labour insiders insist it isn’t unusual for major speeches to be moved around in the leader’s diary.

But there is no doubt that the run-up to this one has been far from ideal for the party.

After months of behind-the-scenes wrangling, shadow chancellor Rachel Reeves yesterday conceded that Labour’s flagship policy of borrowing £28 billion a year to invest in green technologies had been junked.

An incoming Starmer administration would instead seek to achieve that spending target by the second half of its first term in office, she said.

That’s not the only Labour energy policy to run into choppy waters of late, however.

HuffPost UK has learned that a Sunday Times report last month declaring that a Labour government would block all new North Sea oil and gas developments sent shockwaves through the party north of the border.

Scottish Labour insiders complained of being “blindsided” by the plan, while union leaders and industry bosses were left infuriated.

The party was quick to insist that existing North Sea licenses would not be scrapped, meaning oil and gas extraction would continue until the 2050s. But the damage was already done.

“When I read the Sunday Times story I got that sinking feeling,” said one Scottish Labour figure. “It was complete dismay.

“The next election is Labour’s to win, but never under-estimate the party’s ability to fuck it up. We could lose because of own goals like this.

“There is a key demographic of voters who will be aghast at this. Everybody accepts the need to transition from fossil fuels, but you need to take people with you as you do it. It’s not just about taking heat pump Islington with you.

“You have to take people with you whose livelihoods depend on it. You can’t attack the identity of a whole generation of Scottish workers like this You need to take them with you and explain how Labour’s plan for a green economy will create jobs.

“But they announced this without taking the industry or trade unions with them - it’s politics 101.”

Rachel Reeves has scrapped Labour's plan to borrow £28 billion a year to spend on green technologies.
Rachel Reeves has scrapped Labour's plan to borrow £28 billion a year to spend on green technologies.
Stefan Rousseau - PA Images via Getty Images

There is a strong suspicion that the policy was briefed by those around shadow energy secretary Ed Miliband, who is the driving force behind Labour’s environmental agenda, as an attempt to “bounce” his colleagues into supporting it.

But one Labour source said: “Ed is the jeopardy - he’s been around for while, maybe it’s time to give him a watch and say thanks very much, goodbye.”

Scottish Labour leader Anas Sarwar was left “very frustrated” by the way the plan was unveiled, HuffPost UK has been told.

“After the Sunday Times story appeared there was a big pushback from Scottish Labour but also from the shadow Treasury team and the policy is now in a better place,” said one party insider.

“I don’t think there was any malice from Ed. He and his team just didn’t understand the full implications of what they were saying. You need to take people with you on stuff like this.”

Critics have accused Ed Miliband of trying to "bounce" his colleagues into supporting his plans.
Critics have accused Ed Miliband of trying to "bounce" his colleagues into supporting his plans.
Ian Forsyth via Getty Images

Gary Smith, general secretary of the GMB union, made clear his own frustration on Sky News last week, saying that the party was “being naive”.

He said: “We are critical friends of the Labour party and I think this is just a lack of intellectual rigour and thinking about where they have got to on oil and gas.

“They are focusing on what they think is popular rather than doing the proper thinking to understand what is right for the country.”

He then followed up by telling the union’s annual congress that the oil and gas industry wants “plans not bans” from government.

One union source said: “There is a battle royal going on around Starmer about this.

“This is what happens when you’ve got people from the same socio-economic background who mix in the same circles and create an echo chamber where they all agree with one another without listening to other people.”

“The next election is Labour’s to win, but never under-estimate the party’s ability to fuck it up”

Unsurprisingly, the Tories sense an opportunity to take advantage of Labour’s woes over North Sea oil.

Scottish Conservative leader Douglas Ross told HuffPost UK: “There is now very little between Scottish Labour and the SNP when it comes to the future of the North Sea.

“This is an industry that supports around 100,000 jobs in Scotland, and not just in the north east.

“Labour’s position doesn’t make sense economically or environmentally because if you don’t source your energy locally in our waters, you will have to import it from abroad, meaning bigger costs and a bigger carbon footprint.”

Starmer has worked hard in the last three years to make Labour competitive once again in Scotland as well as the rest of the UK.

He needs to make sure his big speech in nine days’ time does not undo much of what he has already achieved.


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