Arya News - Ed Miliband derailed a plan to fund Britain’s rearmament by ramping up North Sea drilling, The Telegraph can reveal.
Ed Miliband derailed a plan to fund Britain’s rearmament by ramping up North Sea drilling, The Telegraph can reveal.
A proposal to boost oil and gas production was modelled by the Treasury as fraught discussions took place between Downing Street and the Ministry of Defence over the delayed defence investment plan (DIP).
The Treasury is understood to have concluded that more drilling in the North Sea would generate enough tax revenue to cover a significant chunk of the £18bn sought by the Ministry of Defence for military programmes. The plan was backed by Rachel Reeves and presented to the Prime Minister.
However, a Cabinet source claimed Mr Miliband “vetoed” the North Sea proposal.
Sir Keir Starmer ultimately failed to back the idea, allowing opposition from the Energy Secretary to win the day.
A source close to Mr Miliband insisted he was not consulted specifically about using North Sea oil and gas revenues to fund the DIP. They claimed the only talks between Mr Miliband and Downing Street were over cuts to his department’s capital budget.
However, the Cabinet source told The Telegraph there was fury at Mr Miliband’s blocking of greater drilling in the North Sea.
They also accused him of slow-walking approvals for the multibillion-pound Rosebank and Jackdaw oil and gas fields, which could create thousands of jobs.
Copy of 0704 The North Sea is still the biggest source of gas for the UK
The source said: “Ed has refused to make decisions on Rosebank and Jackdaw despite Scottish Labour and most of us wanting him to.
“We got obliterated in the Aberdeen by-election because of his intransigence last week.”
The revelation comes as Mr Miliband is in the running to succeed Ms Reeves as Chancellor in a potential Labour administration led by Andy Burnham, the former Manchester mayor.
However, the Energy Secretary’s refusal to reconsider a ban on new drilling licences in the North Sea is said to be damaging his chances. Mr Burnham, the frontrunner to succeed Sir Keir, is now said to be worried that a chancellor Miliband would appear overly ideological to voters.
Opposition to the Energy Secretary is also hardening in some sections of the parliamentary Labour Party, with dozens of MPs said to have expressed concerns.
One MP representing a Red Wall constituency said: “We’re very concerned about his messianic drive to pursue a green economy while destroying thousands of jobs in the process.
“Most of us are saying that this needs to slow down. We must obviously create energy security, but we need to use oil and gas supplies, maintain jobs, and keep energy prices down.”
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