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Households in line for direct shale gas development proceeds

Published: Thursday, 11th August 2016

PM amends Shale Wealth Fund proposals to include an option for the transfer of funds directly to households…

Prime Minister Theresa May has announced that a proposed scheme to spread the benefits of shale gas will include options to give more of the proceeds directly to local residents than previously planned.

She also signalled that this approach will also be considered as an element of a revised Community Infrastructure Levy (CIL) regime.

The Shale Wealth Fund scheme, now out for consultation, was previously expected to share proceeds from shale revenues only with community trusts and local authorities.

The consultation has now been changed by the PM to include the option of money being paid directly to local residents in host areas.

May pledged that the principle of direct benefit to households would be a blueprint for other schemes, citing the CIL.

Plans for the shale wealth fund were first announced in last year’s Autumn Statement, but the new government is changing the consultation to ensure a greater focus on control for local communities, including insisting on proposals to transfer funds directly to households rather than local authorities.

Communities could receive up to 10 per cent per cent of tax revenues derived from shale exploration in their area to spend on priorities such as local infrastructure and skills training. The new fund could deliver up to £10m per eligible community.

Speaking ahead of the consultation launch, May said: “The government I lead will be always be driven by the interests of the many, ordinary families for whom life is harder than many people in politics realise. This announcement is an example of putting those principles into action. It’s about making sure people personally benefit from economic decisions that are taken, not just councils, and putting them back in control over their lives.

We’ll be looking at applying this approach to other government programmes in the future too, as we press on with the work of building a country that works for everyone.”

Ministers have stressed that the government is committed to ensuring that local communities are fully involved in planning decisions that affect them. Any shale applications, whether decided by councils or government, will continue to require a full consultation with local people.

Environmental groups have complained that a move to share the proceeds of shale gas development with individual households represents a form of state-bribery.

View the press release

Roger Milne