Wednesday, 21 May 2008

Holyrood Diary May 20, 2008

When I filled the car with diesel last weekend it was the first time I’ve had to fork out £50 to fill the tank. I’m sure many of you have reached that level long before this because that was at the Skiach Services in Easter Ross - not in the Far North. We all worry about world-wide food price rises and rising fuel poverty here in Scotland. So I am delighted that the SNP Cabinet Secretary for Finance John Swinney MSP has written to the Chancellor in London and pointed out Scotland has a £4.4 billion budget surplus, according to Grant Thornton partners. This is based on Scotland receiving 82.5% of North Sea oil revenues which would mean, with a 95% share, a Scottish surplus of £6.2 billion.

Meanwhile the Chancellor’s Budget oil revenue forecast was based on an oil price of $83.80 a barrel. Yet the price of oil has soared to $120 a barrel. So the SNP believes that Westminster’s sky high fuel duty policy is imposing unacceptable hikes in petrol and diesel prices in Scotland.

Said Mr Swinney,

“With our North Sea resources, an independent Scotland would be the 3rd richest nation in the EU in terms of wealth per head – compared to the UK’s current 7th place – so there can be no doubt that the present flow of resources is north to south, not the other way round.”

“After generations of sending North Sea revenues to Westminster, it is vital that Scotland has access to and benefits from our own resources. It cannot be right that we have fuel poverty and soaring road fuel prices amid this energy plenty. “

We urgently need talks on greater financial independence for Scotland, including a transfer of oil and gas resources to the Scottish Parliament, so that we can invest in Scotland’s long-term economic interests.

All MSPs are flooded with calls for help. The Federation of Small Businesses and the Scottish Chambers of Commerce want the Chancellor to cancel the proposed 2p rise in fuel duty due to be introduced in autumn 2008. Their figures indicate that the UK Government has received an additional £505 million of revenue, due to rising fuel prices, over the last six weeks and agree with the SNP that we need to introduce a fuel price regulator.

In the Ferry Enquiry, ongoing in the Holyrood Transport Committee, we’ve heard that privately owned shipping operators are very negatively affected by strongly rising bunker fuel costs. Prof Alf Baird, the Orkney-based expert from Napier University, gave evidence and also noted that private ferry operators in Scotland already exist in an extremely uneven playing field due to the fact that the Government regularly increases subsidy payments to its own state-owned ferry operating companies (CalMac and Northlink) to enable these businesses to pay their rising fuel bills. This is in addition to rapidly rising subsidies to cover state-owned ferry company operating costs (or rather losses) more generally.

With the price of diesel now over £1.35 in the Western and Northern Isles and across Scotland’s island and remote communities this makes it probably the most expensive diesel in the western world. Many years ago in parts of France cuts in fuel duty in the remotest areas were agreed. Why not here?

My colleague Mike Weir MP has lodged an Early Day Motion (EDM) at Westminster with cross party support to protest against the lack of regulation on the prices of home fuel oil or bottled gas. But unbelievably both Ofgem and Energywatch have confirmed that there is no regulator with the task of looking at the market or interests of consumers who use home fuel oil or bottled gas. They do not even have the limited protection available to gas and electricity consumers.

It is abundantly clear that Westminster’s financial black hole is being filled with Scotland’s black, black oil.


THE All-Energy Conference in Aberdeen this week showcased the huge potential of our renewable energy resources, over 4,000 delegates attended. Scottish Energy Minister Jim Mather and Malcolm Wicks from London Government spoke.

But a worrying tone was noted among the public by Scottish Renewables. People seem reluctant to pay for the effects of peak oil and the dangers of climate change. Somehow folk haven’t caught up with the fact that the world is already paying a huge price for climate change, as we are also.

One symptom of this mismatch was heard from SCDI, the Scottish Council for Development and Industry, meeting recently in Inverness to ponder improvements to our Highland transport, or as it turned out our Highland roads. They want a national commitment in relation to the A96 Aberdeen-Inverness road, A9 Perth-Thurso and A82 Glasgow to Inverness roads, if the Scottish economy is to reap the benefits of growth opportunities in the north in priority industries, such as tourism, food and drink, and energy.

Can you believe that sea and rail are ignored by the SCDI? They don’t seem to grasp that peak oil will require a reduction in road journeys to take freight like the supermarket lorries off the road, and that rail services are far more CO2 friendly. In fact, the Caithness Partnership has a far more balanced transport policy than they do. HIE and HITRANS have echoed the SCDI blind spot hoping to reap the benefits of wave and tidal energy from Pentland Firth but refusing to invest in our real transport needs north of Inverness. It’s time HIE and HITRANS woke up.

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