George Osborne’s decision to bolster oil company profits by giving them tax relief while workers tighten their belts goes some way to explaining why he is so widely hated.
He and his coalition cronies shed crocodile tears over the cuts in living standards forced on the poor, insisting that everyone has to take a hit because “we’re all in it together.”
But the Chancellor takes pity on the very institutions and their prosperous shareholders who could afford to shoulder more of the financial burden of bailing out irresponsible private bankers.
He dresses up his state handout to the oil transnational corporations as a means of creating jobs, but this mantra is trotted out every time he responds to pleas from representatives of the hard-done-by 1 per cent elite.
His follow-up line that this tax break will deliver more revenue for taxpayers is nonsense.
It will cost the government — more accurately, those of us who pay tax, both direct and indirect — £100 million a year to persuade Big Oil to do what would be expected of it anyway.
Why should the Chancellor have to ask politely? Oil companies’ licences are subject to various conditions relating to pollution, employment requirements, depletion of resources etc.
He is in the driving seat, but he chooses to act as the oil companies’ chauffeur rather than ours.
When Oil and Gas UK economics director Mike Tholen reveals that “some very substantial projects” have been awaiting this announcement before approving investment in the North Sea, he lays bare the collusion between government and Big Oil in exploiting this massive national asset.
Contrast Osborne’s oily complicity with the industry against Venezuela’s dynamic governmental attitude to these amoral profiteers.
The Bolivarian government in Caracas lets the oil companies know who is boss and insists on the interests of the Venezuelan people taking precedence.
Little chance of that happening in Britain, where we have a conservative coalition intent on eroding working people’s standard of living and further widening the gulf between those who rely on salaries, benefits and pensions to exist and those who live luxuriously off unearned wealth.
Scottish First Minister Alex Salmond’s political outlook restricts his criticism of Osborne’s actions to complaining that he should have done the oil companies’ bidding earlier.
However, his assessment that more than half of the value of the North Sea’s oil and gas reserves, still worth an estimated £1.5 trillion, have yet to be extracted indicates that the British government has underplayed its hand.
The scale of these resources underscores the short-sighted nature of British governments over the past four decades which saw no further than handing over the entire operation to private oil companies.
Labour has retreated from its original policy, under then energy minister Tony Benn, of setting up in 1975 the publicly owned British National Oil Corporation to ring-fence oil revenues for industrial regeneration and an independent petrochemical industry rather than, as the Tories subsequently did, to squander them on short-term tax cuts as an election sweetener.
The value of contrasting approaches can be seen not only in Venezuela but also in Norway, where oil revenue was harnessed in the State Petroleum Fund, subsequently called the Government Pension Fund and now worth over £370bn.
Osborne’s actions confirm once again the falsity of Tory claims to be committed to higher living standards and green energy development.
If you appreciated this article then please consider donating to the Morning Star's Fighting Fund to ensure we can keep developing your paper.