SNP pressure forces Westminster to release Scotland’s fossil fuel levy fund


By a Newsnet reporter
The UK government has backed down in the row over Scotland’s fossil fuel levy fund after an announcement today confirmed that the money is to be released.
UK Chancellor George Osborne has today confirmed that the money will now be released to the Scottish government for investment in the Scottish renewables industry.

The decision was welcomed by SNP MSP Rob Gibson who claimed it was good news for Scotland’s green-energy sector and a success for campaigners.

Mr Gibson said: “The SNP has campaigned for access to this vital investment in our renewable industry for years and I am pleased the UK Government has finally seen sense and accepted our ideas.

“This proposal was one of the first points made by Alex Salmond to the UK Government after May’s election and in the face of such public support for the SNP it was simply impossible for the Tories and Lib Dems to continue to hoard Scotland’s cash at a time when investment in our renewable future is a key part of delivering economic growth.

“This first £100 million will bring real benefit to Scotland’s renewable industry with investment across the country in our infrastructure to deliver Scotland’s renewables revolution.

“This is a good day for the Scottish renewables industry and a success for all those who have campaigned against the ridiculous proposals from the Tories and Lib Dems and for this money to be released for spending in Scotland.”
The fund, which belongs to Scotland, was the result of a carbon tax levied on fossil fuel power generators.  It was ring fenced for Scottish renewable projects.  The cash has grown to over £200 million and has been at the centre of a bitter row ever since the last Labour government refused to release it from its London bank account.

Chancellor George Osborne, who announced the decision on a visit to Easter Ross, said the UK government was committed to Scotland’s green-energy sector and said: “It’s great news that we have been able to cut through the arguments and the wrangling with the Scottish government that have stopped this money being invested in the past.

“It shows how serious the UK government is in its support for Scotland’s green future.”

The proposal for releasing the money was put to the Chancellor by Alex Salmond and John Swinney immediately after May’s election.  The new deal, negotiated between Edinburgh and London, will see £103m invested in Scottish renewable energy projects, including wave and tidal schemes.  The remaining £103m will contribute to the £3bn UK-wide Green Investment Bank.

The current Tory/LibDem coalition had previously offered to free the money but threatened to cut the Scottish budget by a similar amount.  This proposal was rejected in October last year after a vote in the Scottish parliament backed an SNP motion.  The motion also called for the planned Green Investment Bank to be located in Edinburgh.