The Unjust Transition
If Labour carries on with its baffling refusal to save Grangemouth oil refinery, hundreds of workers will lose jobs, Scotland could face fuel shortages, and – once again in British history – an entire community could face collapse.
Grangemouth oil refinery, seen at night in 2016. (Credit: Darren Tennant via Flickr)
As a Labour MP, I know who I represent in Westminster. When I take my seat in Parliament, I do so in the interests of many communities that have been left behind by four decades of deindustrialisation.
On the one side of my constituency is Clackmannanshire, whose mills, pits, and breweries were once the providers of employment and opportunity for local workers. But like many former industrial heartlands, those skilled jobs are now gone, with these venues for personal and community prosperity now demolished or lying dormant.
On the other side is Grangemouth, where the skyline for the last 100 years has been dominated by an imposing industrial complex. A century ago, Grangemouth was the ideal location for a refinery; situated between Glasgow and Edinburgh, there was an abundance of flat land, a busy port, and a skilled local workforce that was already experienced in shale refining.
Just as those traditional industries I’ve outlined in Clackmannanshire were important bedrocks of the local area, so too is the Grangemouth oil refinery the heartbeat of the community. It is a workplace with a sense of permanence, one that has employed generations — when you speak to local residents, you quickly understand that there aren’t many local families which do not have some relationship or tie to the refinery.
The refinery’s importance stretches beyond the boundaries of the town, as well. Grangemouth is the primary supplier of aviation fuel to Scotland’s airports, as well as the major supplier of petrol and diesel fuels to the country. Grangemouth keeps Scotland moving, and it generates over £400 million every year for the Scottish economy.
Yet this key piece of infrastructure — like so many essentials that keep our country moving — is in the hands of private capital and foreign government ownership. Latterly, Grangemouth oil refinery has been a joint venture between Jim Ratcliffe’s multinational conglomerate Ineos and PetroChina, an oil and gas company owned by the China National Petroleum Corporation. Together, they are Petroineos.
Killing a Town
In late 2023, Petroineos announced that Grangemouth would cease operations in the second quarter of 2025, meaning that 435 highly skilled jobs will be lost. The first set of redundancies will be coming into effect at the end of April, in a classic example of workers being treated like commodities. The interests of private capital have come first; workers at Scotland’s oil refinery are exploited and then disposed of.
But what of the future? Petroineos appreciates the value of retaining the site because it is part of the Green Freeport Area, a special economic zone designed to boost investment and opportunities in previously industrialised areas. The honest truth is that entities like Petroineos will reap the rewards of the tax breaks these zones will provide, and the refinery will be replaced by an import terminal; we will be shutting down Scotland’s oil refinery in order to ship in the fuel that we need from mainland Europe.
It would be simple to say that no refining of oil will mean a net ecological positive. But quite alarmingly, neither the Westminster nor Holyrood governments have conducted environmental impact assessments about what shifting the fuel we still rely on across Europe means, with a guess being that the transport logistics will surely incur more damage to the environment.
Additionally, since the imported fuel will no longer be tested as thoroughly as the Grangemouth fuel, workers in shared services and departments such as research laboratories will also belong to the 435 refinery workers facing redundancy. This also raises wider questions about the consistency of imported oil; if it does not pass even a reduced quality test, which is far from unlikely, then Scotland faces the real possibility of fuel shortages.
Beyond these concerns, there is also the fundamental question of the local economy. Grangemouth town centre is a typical Scottish town centre — one with far too little retail offers as it is. Many local businesses that exist rely on refinery custom to pay their bills, and should that go, hundreds more job losses will hit the place. Labour in power simply cannot accept a situation where, as we have seen before in Scottish history, a skilled and talented workforce will have to leave en masse in search of work.
The primary duty of any government is to keep its citizens safe, and so the closure is an issue of national concern. With war continuing to rage in Europe and extreme political volatility across the globe becoming the norm, it seems utterly bizarre that an energy-rich nation is deciding to give up its refining capacity — it is a decision as farcical as it is dangerous.
Where is Westminster?
And what of the Labour government’s response? During the 2024 general election campaign, Scottish Labour leader Anas Sarwar announced in a televised debate that a Labour government ‘would step in to save the jobs at the refinery and to invest in that transition’ by putting ‘hundreds of millions of pounds behind it to make it a reality’.
The government hasn’t lived up to the campaign rhetoric. Labour ministers have called the closure ‘regrettable’, and claimed that workers will be fine because they have desirable skills that will surely land them work elsewhere. This reaction is not only insensitive to my community, but also falls way short of what the leadership promised during the election campaign. There is to be no saving of jobs, and no delivery of a just transition for the Grangemouth refinery workers.
Instead, the Labour leadership have decided to play the blame game. Somewhat deservedly so, I must say: the SNP government knew about the scheduled closure for approximately three years and did nothing. The Conservatives in Westminster also didn’t engage with Petroineos to find a viable solution to save jobs and the refinery. Yes, this is an issue that Labour has inherited — but closure will now happen on Labour’s watch.
As a solution, Keir Starmer has pinned his government’s hopes on Project Willow, an investigation into what the industrial future of Grangemouth could be. Project Willow was commissioned and paid for by both the Scottish and UK Governments; EY were hired, presenting their recommendations as an assortment of potential industries that could be realised at the Grangemouth site in the middle of the 2030s. This is preposterous — who is seriously expecting workers to be waiting around for a decade?
It was with much fanfare and acclaim that in February, at the Scottish Labour Conference, Starmer announced that £200 million from the National Wealth Fund would be forthcoming to entice private capital to invest in the site. This money is totally conditional on Petroineos giving their blessing to any future industry wanting to make Grangemouth their home.
After being questioned in the House of Commons, the government admitted they have no desire for any public ownership of what comes next at Grangemouth. No lessons are being learned; workers and their communities will be susceptible to the same set of circumstances being repeated, with private capital continuing to hold all the aces.
On the campaign trail, Labour said that this election gave Scotland the chance to do more than send a message to Westminster — it was the nation’s chance to send Labour MPs to be at the heart of government. To go from two Scottish Labour MPs to 37 was an impressive return and showed that the country bought into that opportunity.
Since winning my seat in that election, my call for nationalisation has been swiftly dismissed. So were my repeated pleas for government intervention to extend the life of the refinery until the new energy industries are operational. In the wake of the government intervening to safeguard the future of British Steel in Scunthorpe, the wilful inaction and lack of appetite to do the same for Grangemouth and Scotland’s only oil refinery is baffling.
Of course, I welcome the government’s action for Scunthorpe. It is exactly what I have been calling for in Grangemouth. But by allowing the refinery to close with no questions asked, the government has abandoned any credibility of a supposed industrial strategy for Scotland.
This inertia on Grangemouth has created an opportunity for Scottish nationalism to receive a shot in the arm — a gift that has been gratefully accepted by First Minister John Swinney as he leads his party into the Scottish Parliamentary elections in 2026. Despite a dismal record in government, with every public service having deteriorated under their stewardship, recent polling has the SNP securing a fifth term, and Scottish Labour falling further behind, to become the fourth largest party in Holyrood.
Before it is too late, the Labour leadership need to realise who it is they are supposed to represent — in both our Parliaments.