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Cable rules out raid on North Sea oil riches

Cable rules out  raid on North Sea oil riches
Vince Cable vowed last night not to raid the North Sea for money to reduce the huge UK budget deficit caused by the banking crisis.

Vince Cable vowed last night not to raid the North Sea for money to reduce the huge UK budget deficit caused by the banking crisis.

The Liberal Democrat finance spokesman – who has been tipped for the job of chancellor if Thursday’s general election produces a hung parliament – said it was wrong to treat the offshore industry as a “cash cow”.

However, he admitted he could not promise to reverse the 10% extra business tax imposed on the oil and gas sector four years ago by Gordon Brown when he was still boss at the Treasury.

Mr Cable was speaking in Aberdeen as all the party leaders stepped up their campaigns during the crucial last few days before the country goes to the polls.

In London, Gordon Brown, David Cameron and Nick Clegg all addressed a rally of religious and community groups – the last time they will share a platform before Thursday’s vote.

The prime minister’s speech was interrupted by a man who ran on to the stage with a banner reading “NuKiller Power No”. Mr Brown was cheered as he forged on with his address after the man was led away.

Visibly buoyed by his appearance before the Citizens UK Assembly at Methodist Central Hall in Westminster, a smiling Mr Brown told them: “You have given me heart today and you have inspired me by the way you are dealing with the important causes of our time.”

Earlier, Mr Cameron told the non-partisan meeting that a Conservative administration would work with civil-society organisations to build what he called “the big society”.

“Together, we can change this country, and I can’t wait to get started,” he said.

Mr Clegg told the assembly that the election provided a “unique opportunity for us to do things differently and usher in a new politics which you once again can be proud of”.

Meanwhile, SNP leader Alex Salmond urged Labour “deserters” to back his party.

He claimed the Nationalists had “the momentum” and were the only people who could protect Scotland from the “cuts agenda” of all three London-based parties.

Mr Cable used his visit to Europe’s oil capital to spell out his party’s policy on the offshore industry.

He said he would be willing to take on the job of chancellor – although he described it as “a poisoned chalice” because the unpopular decisions on spending cuts that he would have to take could make him “the most hated man in the country”.

Mr Cable said: “We are not arguing for special tax breaks offshore, but we would argue for a tax policy that reflects the realities of the industry that involve rising costs for marginal fields. The important thing is not treating the industry as a cash cow you can raid from time to time.”

A spokeswoman for UK Oil and Gas said the body was “pleased to hear of policy intentions that recognise the need to maximise recovery of the UK’s indigenous oil and gas reserves”.

She added: “Currently, just 11billion of the potential 25billion barrels of oil and gas remaining on the UK continental shelf are being considered for development, and new exploration – the lifeblood of this industry – will be required to reach the other 14billion barrels.

“It is imperative that the next government continues to work with the industry to move towards a fiscal and regulatory regime that encourages that potential to be realised.”

Mr Cable came under fire from Labour’s Aberdeen South candidate, Anne Begg, who warned that Lib Dem policies would result in “a huge black hole” in the nation’s finances.

She said her party had treated the industry as an important contributor to the economy and succeeded in enhancing tax revenues while maximising oil recovery.

Aberdeen North’s Frank Doran accused Mr Cable of being “wishy-washy” compared with a government that had worked with the industry on incentives to attract newcomers offshore.

Tory Treasury spokesman Gregg Hands said there was “no chance” that Mr Cable would be in charge of the purse strings in any Conservative-Lib Dem coalition.

He added: “We will do more to prolong the life of the offshore industry with a consistent and competitive fiscal regime.”

SNP energy spokesman and Angus candidate Mike Weir said: “The North Sea clearly needs a tax regime which encourages investment. The Liberals seem to have nothing to offer.”

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