The UK Treasury drinks deeply from Scotland's resources

More licences for oil and gas and a duty hike to make whisky the most taxed drink in the world – these two moves make it clear that the UK Treasury plans to swell its coffers by drinking deeply from Scotland’s resources. Is it taking what it can before Scotland becomes independent?

After Rishi Sunak took a private jet to Aberdeen to announce 100 new licences to drill for oil and gas in the North Sea, many took to social media to share the irony of this. 

The whisky duty hike also made a mockery of the Conservative’s pledge before the 2019 election to support the Scotch Whisky industry.

Scotland did not elect the current UK government. Without independence, the Scottish government is powerless to protect its resources from exploitation by the UK. 

An insult to the intelligence of the Scottish people?

At the time of the 2014 referendum, voters were told it was too late to benefit from Scotland’s oil and gas. They would run out in 15 years, leaving Scotland depending on energy imports from England.

On September 18, 2014, the Times carried the headline: “North Sea Oil Running Out Faster Than Feared”. ​​It reported: “One of Britain’s leading energy consultancies has blown a hole in the Yes campaign’s budget forecasts for an independent Scotland, warning that North Sea oil is running out more quickly than had been thought.” 

Last week, some re-shared a video of Sir Ian Wood from 2014, denouncing “spectacular figures – an additional 20 billion barrels of oil recoverable from the North Sea” he said were being suggested by the Yes side. Wood scoffed: “Frankly that’s an insult to the intelligence of the Scottish people”.

Those 2014 predictions on oil proved wide of the mark

The Wood Mackenzie group reported that production would fall below a million barrels a day by 2023. That prediction proved very wrong. The UK sector currently produces about 1.6 million barrels of oil equivalent per day. Sunak’s bid to licence more than 100 new drilling projects will keep the money flowing to the Treasury – although the way the UK chooses to deal with oil and gas resources means that it creates much less benefit to the public than countries like Norway, which have kept a stake and flowed profits into a huge sovereign wealth fund.

Sunak makes it cheaper to pollute

Sunak is also making it cheaper for the oil and gas industry to pollute in Britain compared with the EU by watering down reforms to the carbon market. In the latest sign that the UK government is losing interest in following through on its climate commitments. Whitehall recently announced changes to the UK’s carbon trading scheme. The move has pushed carbon prices to trade at a steep discount compared with those in Europe, sparking warnings from industry that it will undermine green investments and increase fossil fuel use. 

There is very little to suggest that draining more oil and gas from the North Sea will reduce household bills or increase energy security for Scottish consumers. To renew licences for extracting even more oil without a viable plan for how this can be reinvested into renewable energy or the transition to net zero shows a clear disregard both for the environment and the future viability of the North East of Scotland's energy sector.

Give us your Glens

The oil and gas news was followed  by a “complete betrayal” of Scotland’s whisky industry as new rules come into force that will see each bottle taxed at an unprecedented 75%. 

Richard Lochhead, MSP for the Speyside area, said: “There’s no doubt this 10% increase in duty – the highest rise in 40 years – is a complete betrayal of one of Scotland’s most valued industries. Ahead of the 2019 General Election, we had the Tories announce to big fanfare their plans to ensure the tax system supported the Scotch whisky industry. That commitment has been abandoned and the average bottle of whisky will now be taxed at an astonishing 75%.”

On top of that, energy costs are rising, but distillation was excluded from the energy bill relief offered by the government. An unavoidably energy-intensive process, distillers are now looking at another year of further cost increases with no government support – two thirds of distillers have said their costs will go up, leading to further price increases for the consumer and less investment in people, places and sustainability initiatives.

The Scottish Whisky Association said that the 73m bottles of Scotch sold in the UK each year will become the most highly taxed drink in the world, raising hundreds of millions in tax to the UK Treasury from domestic sales alone – and contributing £5.5 billion to the UK’s GVA in total.

The Association said: “For distillers, to be taxed this heavily, on their own doorstep and in a market which for many smaller producers is the first in which their products are sold, is damaging..and disincentivising.”


The UK Government is taking advantage of its power over Scotland’s resources to drink deeply. It is taking steps that are not supported by the Scottish people or their elected government. The revenue that flows to the Treasury will not be used on the priorities of the Scottish electorate. 

But there is little that Scotland can do under the current constitutional arrangement to stop this. It will fuel the sense of urgency many Scots have to work towards the goal of independence.