North Sea windfall tax and winter fuel payment stand despite lost votes, says Chancellor

The Chancellor has doubled down on her decisions to hike the windfall tax on oil and gas producers and cut the universal winter fuel payment.

Rachel Reeves said the increased Energy Profits Levy of 38% was here to stay despite hundreds of jobs being axed by largest independent oil and gas firm in the North Sea.

Harbour Energy announced on Wednesday that it is cutting a further 250 onshore jobs in Scotland.

It said this was because of the UK Government’s “punitive fiscal position and a challenging regulatory environment”.

Speaking to STV News on Wednesday, Reeves said the windfall tax still stands.

“It brings in substantial money for public services, and that’s why we were able to make a record settlement grant for the Scottish Government,” Reeves said.

“My thoughts are with those people worried about their jobs at Harbour Energy.”

She called Harbour Energy’s announcement a “commercial decision” by one company and added: “There are many other companies not laying off their workers.

“Our plan for the North Sea was welcomed by Offshore Energies UK, the Confederation of British Industry in Scotland, and Energy UK.

“There’s an important role for oil and gas for many years to come, but that’s also why, as a Government, we’re investing in hydrogen, carbon capture storage.”

Reeves maintained that it’s important for energy companies to pay up since they made record profits after the Russian invasion of Ukraine at a time when normal people saw their energy bills “go through the roof”.

In the same interview, Reeves also doubled down on her controversial decision to scrap the winter fuel payments for all pensioners.

“We had to make a number of difficult decisions when we came into office last year to stabilise the public finances after the mess the Conservatives left them in,” Reeves said.

“I do understand people’s concerns about the cost of living crisis.”

She insisted that her Labour Government has brought in policies such as the national living wage increases, triple lock policies and interest rate cuts to help people out.

However, she said the winter fuel payment cuts are a policy that “stands”.

“It was necessary to put public finances on a firm footing, but I do get people’s concerns about the cost of living,” Reeves said.

‘Transformational India trade deal will put money in Scottish pockets’

Reeves visited the Glenkinchie distillery in East Lothian on Wednesday to celebrate the “transformational” India trade agreement that will make a “massive difference” to the whisky industry in Scotland.

The UK Government struck the multi-billion-pound deal on Tuesday, which is to make it cheaper and easier for both nations to buy and sell goods and services to one another.

British shoppers could see cheaper prices and more choice on products including clothes, footwear, and food products including frozen prawns as the UK cuts tariffs.

The deal will also slash Indian tariffs on key UK exports such as whisky, cosmetics and medical devices.

“As the Scotch Whisky Association have said, this deal is transformational,” Reeves told STV News.

“It will more than half the tariffs applied to Scotch Whisky being exported to India and India is the biggest market in the world now for whisky.

“Having that access for Scotch whisky to the Indian market will make a massive difference for good jobs paying decent wages here in Scotland and putting money in people’s pockets.”

The UK Government previously said the deal was the “biggest and most economically significant” trade agreement the UK had signed since leaving the European Union in 2020.