One hates to say “I told you so” to the Chancellor of the Exchequer, but on Wednesday this week, I considered the plan of the Rt Hon Gideon George Oliver Osborne, heir to the Seventeenth Baronet, to increase the “supplementary charge” on domestic oil and gas production from 20% to 32%, and concluded that he might be on less than solid ground.
Less than two days later, the trade body Oil and Gas UK has made its displeasure known through the pages of the Maily Telegraph, warning of job losses in an already shrinking industry, as I suggested earlier. The oil producers have confirmed that Osborne’s move is likely to mean less oil produced from the UK’s reserves, and more dependence on imports.
How many job losses is the industry considering? Well, the phrase “tens of thousands” has been pitched. And the Treasury response that “profits will remain high” will cut no ice if those profits are even higher when resources are shifted to other parts of the world.The Chancellor is playing a risky game on this one.