Andy Burnham urged to develop remaining North Sea oil and gas to prevent mass redundancies
The UK must exploit its remaining North Sea oil and gas reserves to prevent mass job losses in Scotland and the north-east, the director general of the British Chambers of Commerce has said, as the country braces for a change of government that could decide the fate of two major offshore fields.
Shevaun Haviland, who leads the business group representing 19,000 firms employing eight million people, said the decision on whether to allow extraction at the Jackdaw and Rosebank fields now looks set to fall to a prospective Andy Burnham administration. Burnham, the former Mayor of Greater Manchester and front-runner to succeed Keir Starmer as prime minister, has built a reputation as the “King of the North” and is expected to apply his regional regeneration approach nationally.
Oil and Gas: A Lifeline for Jobs
Haviland argued that rather than importing liquefied gas – which is both more expensive and less environmentally friendly – the UK should use its own domestic assets. “At the moment, instead of using those fields we are importing liquid gas, which is more expensive and less environmentally friendly. So yes, we believe we should use our own assets,” she said.
The Jackdaw field, a Shell-owned gas project initially approved in 2022 with production scheduled for 2026, and the Rosebank field, an oil and gas project owned by the Adura joint venture between Equinor and Shell approved in 2023, are both at the centre of the debate. Their previous consents were ruled unlawful by Scotland’s Court of Session in January 2025 because they failed to account for the emissions from burning the fuel produced – known as Scope 3 emissions. Developers must now reapply, and the incoming energy secretary, Ed Miliband, seen as sceptical about giving the go-ahead, will have a decisive role.
Offshore Energies UK has urged swift decisions, arguing the fields contribute to energy security and tax revenues and noting that oil and gas still supply around three-quarters of the UK’s needs. Environmental groups counter that the projects are incompatible with climate targets, pointing out that burning Rosebank’s reserves could produce more emissions than the combined annual output of 28 low-income countries, and that the Rosebank project threatens the Faroe-Shetland Sponge Belt Marine Protected Area. Research also casts doubt on the energy-security argument: Jackdaw would provide only about two per cent of UK gas demand over its lifetime, and Rosebank about one per cent, meaning little impact on import reliance.
The Offshore Wind Gap
Haviland stressed that British businesses back the transition to clean energy and are keen to exploit the opportunities it presents. But she warned that the switch to offshore wind is not creating enough jobs to absorb workers displaced as the North Sea winds down, and that local suppliers are being shut out instead of feeding into the new industries.
“It’s just not being managed in the right way. We are absolutely behind the incredible leadership we’ve seen in offshore wind, where we’re a world leader. We are not investing enough in building a local supply chain to support that. A lot of it’s still coming from overseas. And because it hasn’t happened as fast as oil and gas are declining, we have a really worrying gap, and we are seeing the supply chain leave,” she said.
The result, she added, is a growing anxiety that the North Sea could follow the pattern of the coal industry. “There’s some very big concerns from our chambers up in Aberdeen and the north-east that it will go the way of the coalmines, and you’ll have millions of people out of work.” The supply chain that once supported oil and gas platforms is disappearing, while the infrastructure for offshore wind – such as turbine manufacturing and installation vessels – is being sourced from abroad. Without a concerted effort to build a domestic supply chain, the UK risks losing both the jobs and the economic value of the energy transition, she said.
The Cost of Doing Business Crisis
With Burnham likely to enter Downing Street within weeks, Haviland also called on the incoming prime minister to act on what she described as a “cost of doing business crisis”. The BCC has published research showing that the cost of doing business has risen by 70% over the past decade, driven by tax, regulation, the minimum wage, and trade frictions caused by Brexit.
“Businesses don’t feel confident to invest, because business costs are so high, so they pull back from investment, and it’s a vicious cycle,” Haviland said. “Then you don’t get the growth. And you don’t get the tax income. So we want him to look at ways that he can begin to alleviate some of those cost pressures.” She specifically highlighted business rates – which Labour promised to overhaul in its general election manifesto – and the cost of energy. Even before the Iran crisis, she noted, a quarter of BCC members were struggling to pay their energy bills.
Chancellor Rachel Reeves recently promised to backdate the government’s planned Business Industrial Competitiveness scheme, which would cut bills for some energy-intensive sectors. But Haviland said the scheme’s scope remained too narrow. Asked about the possibility of additional taxes on business as Burnham seeks extra funding – including for the controversial Defence Investment Plan – she warned: “We would always come back to him to say, the way out of the fiscal issue that we’re in is economic growth. Taxing business further is a road to ruin. It’s a downward spiral.”
Brexit and the EU: Pragmatism Over Politics
Ten years on from the EU referendum, Haviland echoed recent comments from CBI director general Rain Newton-Smith that, despite the economic costs of Brexit – which economists estimate have reduced UK GDP by 6-8% and left business investment 12% lower – businesses do not want to reopen the question of reversing the decision or even rejoining a customs union. “I think that sort of old language of customs union, single market, all of that, it’s just unhelpful. I think we just all moved on from there. What our members want is pragmatic, specific solutions to the issues,” she said.
A planned EU-UK summit has been postponed pending Burnham’s arrival in Number 10, but Haviland said businesses would like to see negotiations completed on the issues Labour has already prioritised. These include an agrifood deal – a new Sanitary and Phytosanitary agreement due to come into force in mid-2027, which would eliminate paperwork and physical checks on dairy, fish, cheese, eggs and fresh red meat, and is expected to boost UK agri-food exports to the EU by over 20%. They also include a youth exchange programme – the UK is set to rejoin Erasmus+ in 2027 at a cost of roughly £570 million, and negotiations continue on a wider Youth Experience Scheme for 18-30 year olds – and alignment with the EU’s carbon border adjustment mechanism (CBAM). The EU’s CBAM becomes fully operational in January 2026, while the UK plans its own version in 2027 with no transitional period. Haviland warned that failure to align could lead to UK exports being penalised, forcing significant financial transfers to the EU.
Asked about Burnham’s record, Haviland pointed to the transformative role of private sector investment in Manchester. “That has really been a great example of public and private investment – of the public sector laying the right environment for business to come in.” She added that when they last met, at the northern investment summit last month, Burnham told her directly: “You know, I’m pro-business.”
