The Treasury’s Exchequer Secretary, has announced that
people living near sites, approved for the safe and clean
extraction of shale gas, will benefit from a share of the
proceeds through a new ‘Shale Wealth Fund’.
Those living in the North and the Midlands – where there
are significant shale gas reserves – are set to benefit
first.
The fund, which will provide up to £10 million for each
local community, will empower local decision making.
Communities will be able to decide how to spend the money
locally, but projects could include:
- new play parks, community sports facilities and
libraries
- improvements to transport links
- restoration of local heritage sites
The development of a British shale gas industry is set to
bring substantial and far-reaching benefits. Not only
will safe and sustainable exploration of shale boost the
UK economy, create close to 65,000 new jobs and attract
up to £33 billion in investment*, but it could also
generate greater energy security.
The UK currently imports nearly half of its gas from
abroad, and by 2030 this is set to rise to three
quarters. Using UK supplies of shale gas will reduce the
need for this, making Britain more self-sufficient.
The Exchequer Secretary to the Treasury, , MP, said:
Shale production could play an important part in the
UK’s future energy security, creating jobs and boosting
our economy.
The economic benefits must be shared with those living
alongside these sites and this funding will ensure
local people reap the rewards too.
Further information
Following consultation, the government has developed a
clear set of principles that will be at the heart of the
development of the Shale Wealth Fund.
These are:
- a commitment to real local decision-making, by
allowing local communities to determine how the Shale
Wealth Fund is spent in their area. This includes the
potential for household level payments
- prioritising the needs of local people first and
foremost. Where local communities decide that they wish
to spend some funding on regional projects, this should
benefit communities hosting shale sites in those regions,
and be subject to a clear instruction from communities
- providing additional benefits to local communities,
in addition to existing local government funding, and not
as a replacement for existing local spending
- ensuring that decision-making is locally
representative and those who make these decisions are
held accountable to local communities. The process will
be fully transparent
The government has confirmed that it will be up to
communities to decide where the money should go. This
could include being paid directly to local residents in
host areas.
The fund will initially consist of up to 10% of tax
revenues arising from shale gas production, to be used
for the benefit of communities which host shale sites.
The government’s response to its
consultation on the development of a Shale
Wealth Fund was published today (11 November).
More details on how communities will receive the money
will be published in due course.
*EY, Getting Ready for UK Shale Gas, April 2014
