Aberdeen Charity Boss Urges Chancellor to Scrap Windfall Tax, Citing Homelessness Crisis

Strategic Insights -

The Aberdeen Cyrenians charity has submitted a formal proposal to the Treasury, calling for the Energy Profit Levy (EPL) to be scrapped, citing its contribution to a homelessness crisis in the north-east. Chief Executive Donna Hutchison warns that the tax is fuelling "declining investment, job losses, and growing economic insecurity." The charity argues that the EPL is not only harming the oil and gas workforce but also spreading into everyday life in Aberdeen, exacerbating the cost-of-living crisis and pushing more people towards emergency support.

Key Takeaways:

  • The Aberdeen Cyrenians charity has submitted a proposal to the Treasury, urging the Chancellor to scrap the Energy Profit Levy (EPL) and citing its contribution to a homelessness crisis in the north-east.
  • The charity argues that the EPL is not only harming the oil and gas workforce but also spreading into everyday life in Aberdeen, exacerbating the cost-of-living crisis and pushing more families towards emergency support.
  • The charity reports a rise in food bank referrals, homelessness presentations, rent arrears, and poor mental health in Aberdeen, which are the "true indicators of social and economic harm."
  • According to the charity, reforming the EPL is not only an economic imperative but also a moral one, as it can help prevent the human impact of the tax.
  • The charity warns that allowing the local supply chain to weaken during the transition away from fossil fuels could have long-term consequences, including a loss of tax revenue and community resilience.
  • The UK Government spokesperson would not comment on speculation around future changes to tax policy, but stated that they are taking a responsible approach to the oil and gas sector.

Statistics:

  • The charity reports a rise in food bank referrals, homelessness presentations, rent arrears, and poor mental health in Aberdeen.
  • According to the Oak Foundation, there are currently 157,000 families in Scotland who receive support from food banks.
  • The Institute for Fiscal Studies warns that Chancellor Rachel Reeves may need to find around £22 billion in tax increases or spending cuts to restore the £10 billion of fiscal "headroom" she set aside in the spring.
  • Reports suggest that the Office for Budget Responsibility is preparing to downgrade productivity forecasts by 0.3 percentage points, potentially leaving the Chancellor facing an even larger hole, close to £30 billion.

Sources:

  • Aberdeen Cyrenians - formal submission to the Treasury
  • The Herald - interview with Donna Hutchison, Chief Executive of Aberdeen Cyrenians
  • Politico - report on the Treasury's consideration of proposals to scrap the EPL
  • Institute for Fiscal Studies - analysis of the UK's fiscal situation
  • Oak Foundation - report on food bank usage in Scotland