Chancellor backs jobs boost in Scottish defence and energy sectors
Chancellor Rachel Reeves will outline how the Spending Review will give Scotland a jobs boost, as she visits RAF Lossiemouth and St Fergus Gas Plant today (1 August).
- 18,000 North Sea jobs can be safeguarded through a £200 million investment in the Aberdeen Acorn energy project whilst creating 15,000 new ones in Scotland’s clean energy transformation.
- Increase in defence spending will see more jobs added to the 26,100 skilled Scottish jobs already supported by UK Government defence investment, and three new E-7 Wedgetail aircraft will see even more jobs created by Boeing at RAF Lossiemouth.
- Defence and clean energy commitments, part of the UK Government’s Plan for Change, will provide jobs and build thriving communities from Aberdeen to the Clyde.
The UK Government is investing in defence and clean energy to protect existing jobs and create thousands more, while keep the UK secure. Increasing defence spending to 2.6%, could lead to around 0.3% higher GDP in the long run, equivalent to around £11 billion of GDP in today’s money, according to government estimates.
RAF Lossiemouth shows how investment in defence delivers for ordinary families. The Moray base has undergone a huge transformation in recent years and military personnel and civilian workers now work together keep our fighter jets and sub-hunting aircraft in the air. The addition of three new E-7 Wedgetail aircraft to the RAF’s fleet will see even more jobs created by Boeing at the base, where the Chancellor will meet with some of the over 200 Boeing teammates who work alongside RAF personnel.
Chancellor, Rachel Reeves said:
We’re seizing the huge potential and opportunities that Scotland has on offer. Whether it’s in defence to keep the UK safe, or clean energy to power all corners of the country, this government is backing Scotland with billions of pounds of investment to grow the economy and create jobs.
Scottish Secretary, Ian Murray said:
The UK Government is investing in defence to ensure Britain’s security and deter our adversaries and drive economic growth.
This investment is a massive jobs opportunity for Scotland - this ‘defence dividend’ is good news for Scotland, where it will help create skilled jobs, drive economic growth and help tackle the critical skills gaps facing the country in sectors such as nuclear, construction, maritime and project management.
The Spending Review also saw investments that will make Scotland the home of the UK’s clean energy revolution. While Acorn is still subject to final investment decision, this £200 million is just the beginning to this government’s commitment to investing in Scotland and has the potential to safeguard 18,000 North Sea jobs whilst creating 15,000 new ones in Scotland’s clean energy transformation.
Great British Energy will also be headquartered in Aberdeen, to drive clean power generation across the UK. Boosting homegrown energy will also make the UK more secure.
The Chancellor’s visit comes as defence spending rises to 2.6% of GDP and figures from 23/24 reveal that MOD spend maintains 26,100 skilled jobs across Scotland. The Spending Review also committed £250 million to secure the future of HMNB Clyde – the first stage of a multi-decade, multi-billion renewal project and all three Clyde shipyards are currently fulfilling contracts for the Royal Navy.
Further information:
- The Spending Review delivered a record settlement for Scottish public services, with the Scottish Government’s largest settlement, in real terms, since devolution in 1998. Scottish Government’s settlement is growing in real terms between 2024-25 and 2028-29. This translates into an average of £50.9 billion per year between 2026-27 and 2028-29.
Maria Laine, President United Kingdom, Ireland & Nordic region, Boeing, said:
Boeing has a long-standing presence in Scotland including at RAF Lossiemouth, the home to the UK’s P-8 Poseidon fleet and where the E-7 Wedgetail will be based when it enters service. As a key partner of the UK Armed Forces, Boeing welcomes the defence spending increase and has seen first-hand how defence infrastructure investments, such as the £100 million Atlantic Building and new E-7 facilities at RAF Lossiemouth, can deliver for local jobs, suppliers and UK national security.
Michelle Ferguson, Director, CBI Scotland, said:
Scotland’s energy and defence sectors are vital to our economy, driving investment and supporting thousands of skilled jobs. The Chancellor’s announcement of £200 million for the Acorn energy project is very encouraging, but businesses are eager for final approval to unlock its full potential and secure North Sea jobs. Increased defence spending will further boost Scotland’s skilled workforce and create growth opportunities across key supply-chain. Close collaboration between the Scottish and UK governments will be essential to fully realise these benefits, driving forward national security and Scotland’s transition to a resilient, low-carbon economy.
Mark Sommerfeld, UK Director of the Carbon Capture and Storage Association, said:
The Chancellor’s visit to Acorn further highlights the importance of CCUS in securing the future of our foundational industries and delivering a secure low carbon power system - both in Scotland and across the UK. The Government’s commitment to CCUS means that thousands of skilled jobs will be protected, with thousands more created across our industrial heartlands - delivering economic growth and clean power.
To maintain global leadership in CCUS and realise the full benefits for our industrial communities, we need to see clear deployment pathways for both Acorn and Viking CCS, as well as other projects developing at pace across the UK. By doing so, the Government can deliver on its economic growth mission and climate goals.
Katy Heidenreich, Offshore Energies UK Supply Chain and People Director said:
We share the Chancellor’s commitment to Scotland’s energy future. Our industry plays a vital role in delivering jobs, growth, and energy security through the production of homegrown energy.
Government support for projects like Acorn is crucial. The UK Government has committed £200 million in development funding to Acorn — Scotland’s flagship carbon capture and storage initiative — marking a major milestone in advancing the country’s decarbonisation strategy. The project is expected to support around 15,000 jobs during peak construction and repurpose 175 miles of pipeline infrastructure to transport CO₂ from central Scotland to storage.
Updates to this page
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Quotes from Mark Sommerfeld, UK Director of the Carbon Capture and Storage Association and Katy Heidenreich, Offshore Energies UK Supply Chain and People Director added.
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First published.