Friday, February 27th, 2015
The recent rapid fall in oil prices has been widely welcomed. But are low oil prices really good for society?
Clearly they are proving devastating for the hundreds of oil industry employees who are losing their jobs. Similarly, the price reduction does little for the 25% of Highlands’ and Islands’ residents who have no access to a car.
But in fact the price fall will adversely affect all of us.
Firstly, the significant reductions in tax revenues from lower prices will severely affect public services, already under severe strain.
Cuts in council funding have already lead to reduced services – for example, we read in the Inverness Courier that there are currently no experienced school nurses in the Moray Firth basin. Lower tax revenues will only exacerbate this situation. In addition, temporary lower oil prices could well diminish the desire and impetus to develop and invest in alternative methods of energy. Then, when supply and demand does level out again and the prices consequently rise, we won’t have those alternative sources available.
But to make matters worse, the SNP Government are now demanding tax cuts for the oil industry, which can only degrade public services even further.
The SNP’s stance is particularly untenable, given that their independence white paper anticipated the oil and gas sector contributing 10% of Scotland’s overall tax revenues.
But can higher oil prices go hand-in-hand with better quality-of-life for everyone? Yes.
Key to all this is to reduce the need for people to travel by car. One fundamental Green Party policy is to enhance local facilities, and to provide them where they do not currently exist, so reducing travelling time and petrol costs, whether those prices be high or low.
Some of this is already happening. The success of the recently-established Ardersier farmers’ market clearly shows that many people welcome locally-produced, high quality produce.
But much more action is needed. For example, constructing the long-overdue swimming pool for the Black Isle would save time and money for Black Isle residents currently having to travel to Inverness Leisure Centre.
Establishing a district park in East Inverness, as Highland Councillors promised in their 2006 Inverness local plan, would obviate the need for residents in Westhill and Culloden to travel across town to Bught park.
And substantial investment in the library service to become resource centres would provide a high-quality video link-up facility so that meetings could be beamed across the Highlands and Islands, avoiding the need for attendees having to travel many miles to participate.
Fossil fuels are on their way out. Renewables are already making a significant contribution to the economy, with recent employment growth of around 5% in the sector. A more urgent shift in jobs from oil to off-shore wind, wave and tidal power would be widely beneficial. Electrification of the railways, greater use of rail for freight transport, and a far larger uptake of electric cars and bikes would all mean far less dependency on oil for long and short-distance travel.
A society based on oil, with its price volatility and diminishing availability, is wholly unsustainable. This decline needs to be managed carefully, so that society can absorb oil and gas businesses and their employees progressively and over time, and not subject them to the disastrous effects we are daily witnessing.