Public wage subsidies for oil and gas workers should continue even after the coronavirus pandemic has subsided, the Scottish Government has said.
Economy, Fair Work and Culture Secretary Fiona Hyslop was giving evidence to the Scottish Parliament’s Economy, Energy and Fair Work Committee on Tuesday morning on how Scotland will get back to work following the Covid-19 crisis.
Ms Hyslop also suggested the precarious restart to the country’s tourism industry could be upended by those flouting the lockdown guidelines.
Before lockdown, more than 200,000 people were employed in tourism-related businesses in Scotland – more than 7.6% of the entire workforce.
The Scottish Government’s chief economist, Gary Gillespie, also told the committee a no-deal Brexit coming into effect at the beginning of 2021 could cause “friction” to the Scottish economy that would see GDP drop by between 1-2%.
This would be on top of the predicted 33% reduction brought about by thew coronavirus economic shutdown.
By comparison, he noted, the worldwide recession of 2008 shrunk GDP by 5%.
Support for tourism and oil and gas
Ms Hyslop told the committee the Scottish Government had consulted with Westminster for additional support for tourism and the oil and gas industries in particular.
Mid Scotland and Fife Scottish Conservative MSP Dean Lockhart asked Ms Hyslop if the government would ask for more funding than the £10 billion Covid support package allocated by Westminster – and whether analysis had been done to see if an independent Scotland could afford to support industry the way it has done currently.
The SNP member for Linlithgow stated the Scottish Government was not seeking extra help from a political standpoint but because it was what “the Scottish people would expect”.
She said: “We know, even if the tourism industry, can get back in time to have a summer season, their margins will be very different.
“I’m not taking this as a political challenge or spending time addressing political arguments. The Scottish people would not thank us for it.
“We have not done ‘retrospective analysis’ on what could be done when (if Scotland were fiscally independent). We have done it on how we support people under the provisions we have.”
She continued: “Oil and gas is another area that has not just been impacted by Covid-19. There have been issues too around the price of oil that have really contributed to difficulties.
“We should be looking at whether we can continue some kind of wage subsidy support for the sector.
“It is important for the oil and gas industry because of (the) energy transition (scheme), so crucial skills in that sector are there when we have that transition.”
Scottish Conservative MSP for Aberdeenshire West Alexander Burnett said: “The UK Government has invested £10 billion to support Scotland through Covid-19.
“This unprecedented support has helped to safeguard hundreds of thousands of jobs as well as well as assisting the oil and gas industry through an extremely challenging time.
“We are seeing the devastating effects Covid-19 is having on the oil and gas industry in the north-east and it’s vital full focus is put on helping the sector.
“The livelihoods of workers are on the line which is why the Scottish Government must stop dithering and reveal what it plans to do to help the oil and gas industry.
“Workers are yet to hear what these proposals are and there is no time for any more delays in this situation.”
Ms Hyslop also warned the tourism industry’s “restart” could stall if people did not stick to current lockdown guidelines.
She said: “If we see what we have seen (last weekend), of large groups of people and people travelling outside the five-mile guidelines, it is not just their health and the health of friends and families they are risking but also our tourism industry.”
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