The head of the CBI was due in Edinburgh today to call for a rethink of the UK government’s workers’ rights legislation and warn that the oil and gas sector must not be overlooked in the race to exploit the “green goldmine” of clean energy.

Because of the fire at Heathrow, Rain Newton-Smith had to pull out of the annual CBI Scotland lunch in Edinburgh, attended by Scotland’s First Minister John Swinney. Chief strategy officer Tracy Black stood in to deliver the chief executive’s address.

Ms Rain Newton-Smith, the lobby group’s chief executive, was due to tell the audience in Edinburgh that the Labour government needs to “get back around the table” while there is still time to correct some of the shortcomings of the Employment Rights Bill.

“So many firms are still reeling from the National Insurance increases,” she said. “From the significant rise in the National Living Wage. Both announced at the Budget and set to kick in next month.

“To absorb that, many business leaders who want to be signing off on low carbon investments, on innovation, on growth, have with heavy hearts had to delay those projects, cut training and investment, reduce headcount, pass costs on to customers. We must not see tax hikes like this again.

“Yet in the Employment Rights Bill, we have something coming down the track that could make things worse.

“The way the bill is currently designed – will be damaging for the labour market and for confidence. It will make hiring more costly and more risky. It’s a sledgehammer to crack a nut. It’s a wrong turn when we can least afford it.

“We must get back round the table on the Employment Rights Bill. Find a safe landing zone, while there’s still time.”

Ms Newton-Smith also called for action to tackle the problem of economic inactivity and the 3.5 million people in the UK who say they want to work.

She described that as “a devastating waste of potential. And it’s biting even harder in Scotland.

“Government has got to work with business to make sure you have the skills you need. So, in the [Chancellor’s] Spending Review, government needs to make the Apprenticeship Levy more flexible and more transparent on how funds are used in Scotland.”

Her comments outlined the benefits of the energy transition that awaits Scotland, but stress that the oil and gas sector must not be “left out of the picture” and that Holyrood and Westminster must work with business to ensure the UK does not lose out to global rivals.

She said: “As we enter a fast and furious race between states for resources, for investment, and for growth… the fact is that here in the UK we can’t compete on this stage unless we work together.

“Despite the voices being raised against net zero the fact is Scotland is sitting on a goldmine of green energy. The numbers don’t lie. The opportunities are there. 

“Business is behind net zero. Business is invested in our energy transition. And we’re behind the plans to go further. But we can’t see net zero in isolation from the hydrocarbon sector. Especially in Scotland. 

“Oil and gas are still tens of thousands of jobs here. From the latest data it still makes up over 10% of Scotland’s GDP. It will still be a part of the energy mix and the bridge to net zero, for some time yet.

“The infrastructure, the investment, the skills and knowledge of these industries will be mission critical for the transition.

“But too often, they have been left out of the picture, hit by repeated tax changes and uncertainty. We’ve got to connect.

“On one hand, we need clear timelines and funding for net zero commitments government has already made, like the Acorn Project for carbon capture in Aberdeenshire. But on the other, we need a holistic view, that includes oil, gas and chemicals – in a just transition.”

Comment: Parties battle for business vote