Oh well, the North Sea is being kept on tenterhooks for a few more hours, with Treasury first secretary Danny Alexander scheduled to deliver the supposed main news tomorrow.
All chancellor Osborne was prepared to do was trail a few crumbs without even mentioning the North Sea fiscal review, let alone whether it will be the cornerstone of the Alexander delivery, though it of course will be.
Just three measures were mentioned in his Autumn Statement address: “I can tell the house today that we will go ahead with an immediate reduction in the rate of the supplementary charge from 32% to 30%, we will expand the ring-fenced expenditure supplement from six to 10 years and we’re introducing with immediate effect a new cluster area allowance.”
Osborne rounded off saying: “This demonstrates our commitment to the tens of thousands of jobs that depend on this great British industry.”
OK, let’s take the three measures and try and read between the lines.
The miserly though immediate 2% cut in supplementary charge is chickenfeed. OBR figures show the 2% cut in North Sea supplementary charge will cost the Treasury £55million in 2015/16, £60million in 2016/17, £50million in 2017/18, £65million in 2018/19 and £60million in 2019/20.
The six to 10 years extension of the ring-fenced expenditure supplement smacks of tinkering around the edges.
The HP/HT-related (high pressure / high temperature) cluster allowance, which the industry is keen to secure in lieu of a root and branch North Sea fiscal overhaul, is useful but not fundamental.
Indeed, none of the above are fundamental.
Surely there will be more from Alexander; there has to be more. After all the consultations and apparent growing understanding that has supposedly grown up between the North Sea’s leadership and Treasury, there has to be something much more fundamental about to be rolled out when the chief secretary delivers the Treasury’s response to the fiscal review. Rome is currently burning, so there had better not be fiddling.
But let’s wait and see before jumping to conclusions.
However, someone needs to tell Osborne that the UK’s upstream offshore oil & gas capability accounts for some 450,000 UK jobs, not merely “tens of thousands”, which is what he said at the dispatch box.
Later in his speech, the chancellor lighted on the putative onshore shale gas industry in the north of England, stating that a sovereign wealth fund would be set up for the region, paid into by whomever the shale moguls turn out to be over the decades to come, assuming the huge Bowland Shale turns out to be workable.
Announcing such a fund really is rich, given the decades long battles over the UK (leaving aside something Scotland specific) Continental Shelf resources and point blank refusal by a succession of governments to establish a UK-wide sovereign wealth fund.
As Aberdeenshire East MSP, Alex Salmond, conveniently reminds, over £330billion has poured into Treasury coffers over the past 40 or so years, with the bulk of the oil coming from beneath the seas that wash Scotland’s shores.
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