Councils that give the green-light to ‘fracking’ projects will be allowed to keep millions of pounds more in tax revenue, David Cameron has announced.
The Prime Minister said local authorities in England would receive 100% of the business rates collected from shale gas schemes – rather than the usual 50%.
The move is part of an “all out” drive to exploit the controversial pressure mining technique. The Government believes it could generate billions of pounds for the economy, support 74,000 jobs, and lower energy costs.
Total is due to confirm this morning that it is investing in fracking exploration in the UK, by taking a share in a licence in the Midlands currently operated by a US firm.
Whitehall officials said the business rates commitment would mean councils hanging on to up to £1.7 million extra a year from each fracking site.
They stressed that the mining industry had already pledged to give local communities £100,000 for each test drilling – and a further 1% of the revenues if shale gas is discovered.
Mr Cameron said: “A key part of our long-term economic plan to secure Britain’s future is to back businesses with better infrastructure.
“That’s why we’re going all out for shale. It will mean more jobs and opportunities for people, and economic security for our country”.
Writing in the Sun on Sunday, business minister Michael Fallon said Britain had to “embrace the extraordinary opportunities offered by shale gas” for the sake of generations to come.
“In the Seventies, North Sea oil helped salvage our economy from crippling stagnation,” he wrote.
“We have a similar chance to create tens of thousands of jobs and energy security.
“A mile and more beneath us lies deposits of gas-bearing shale rock with the potential to guarantee energy supplies in an increasingly uncertain and competitive world.
“If our boldness is matched by others in Europe, it could also drive down the cost of power for hard-working families and businesses.”
But environmentalists accused ministers of trying to “bribe” local authorities. Lawrence Carter of Greenpeace said: “This is a naked attempt by the government to bribe hard pressed councils into accepting fracking in their area.
“Cameron is effectively telling councils to ignore the risks and threat of large-scale industrialisation in exchange for cold hard cash. But the proposal reveals just how worried the government is about planning applications being turned down. Having had their claims that fracking will bring down energy bills and create jobs thoroughly discredited, the government is now resorting to straight up bribery to sell their deeply unpopular fracking policy.”