§ 2. Mr. Douglas
asked the Chancellor of the Exchequer if he will make a statement on the progress of discussions on changes in taxation on North Sea oil.
§ The Chancellor of the Exchequer (Sir Geoffrey Howe)
Consultations with the industry are in progress and are likely to continue for some time. Due regard will be paid to all representations made to me about prospective changes in the North Sea fiscal regime when I frame my Budget.
§ Mr. Douglas
Will the Chancellor of the Exchequer accept that, because of the nature of the discussions and the time scale involved, certain substantial investments that should be forthcoming from companies as operators in the North Sea are likely to be held up, with considerable consequences for employment opportunities, particularly in Scotland and in British Shipbuilders?
§ Sir Geoffrey Howe
The prospect of any fiscal change is bound to be one factor affecting investment intentions. In reaching my decisions and embarking on a process of consultation I shall do everything possible to strike the right balance between promoting investment and giving a fair reward to investors and securing a fair share of the proceeds for the citizens of this country.
§ Mr. Woolmer
Is the right hon. and learned Gentleman aware of the growing feeling that our substantial and increasing North Sea oil revenues are proving a curse, instead of a blessing, to manufacturing industry? As the director-general of the CBI has asked why we cannot use North Sea oil revenues to restructure British industry, and as the chairman of Shell UK Ltd. has called for a Marshall Aid plan to channel oil revenues into industry, when will the Chancellor start listening to experienced people in industry and use the oil revenues to help growth, instead of financing unemployment?
§ Sir Geoffrey Howe
The hon. Gentleman must understand that the revenues from the North Sea form part of the total revenues accruing to the Exchequer. They fall far short of the total being borrowed in the present year. Out of the expenditure of the Exchequer, substantial sums are already going towards restructuring British industry. I remind the House of the statement that my right hon. Friend the Secretary of State for Industry made about British Leyland earlier this week. The money is already accruing, is part of the Budget and is being used as best it may be.