Tavish Scott: Lack of detail on oil and gas will backfire
THIS week Alex Salmond made a speech in Scotland. That came as quite a surprise. It was the kind of speech I suspect he rather enjoys giving.
commentary on issues, affairs or matters of state. This one was to the Scottish Council Development and Industry’s gathering about the first 40 years of oil and gas exploration in the North Sea and the potential for another 40.
As Scotland is now in the independence campaign, I had thought the senior audience would be treated to a polemic setting out how a Nationalist administration would tax the oil and gas industry. After all, Mr Salmond says he would cut corporation tax in an independent Scotland. He also says that public-sector pensions would be higher and social security benefit payments more generous than in other parts of the United Kingdom. So someone or some industry is going to have to pay for all this.
Salmond has also set out a plan for a Norwegian-style oil fund, although his speech this week was remarkably lacking in any detail on this. Perhaps that is understandable. To establish an oil fund and to, therefore, detail what it could do would depend on knowing how much would be in it and what rate of tax would be applied.
Mr Salmond never mentioned any of that, but lots of oil company people did over coffee.
They also mentioned their concerns over asking any such question of Mr Salmond’s Nationalists for fear of being branded “anti-Scottish” or worse.
Salmond set out some broad taxation principles that should be followed, not by his government, but by the UK one. A tax system that helps the recovery of oil and gas in the North Sea. Certainty for the industry on tax relief for decommissioning the 900 or so oil rigs to be brought ashore by 2020. And finally, the central approach, as Salmond saw it, to taxation. That there should be consultation with the industry prior to any changes in the tax regime. I agree. Philippe Guys, managing director of the French oil giant Total, explained that the North Sea industry has had three big fiscal changes in nine years. That is more than in some South American or African states. So there is a higher degree of political risk here in Scotland compared to elsewhere in the globe as a result.
But these principles would be all the better if the Nationalists practise what they preach.
The Nationalists introduced new business taxes in Scotland without any consultation whatsoever. So when asked if independence would mean lower oil taxes, the oil executive who manages a successful Scottish headquartered company said all politicians say so before they have to set the rate. Indeed.
It is, therefore, easy to see why no oil business is expecting any detail on a Nationalist tax regime until after the independence referendum. So, until then, Mr Salmond, far from being a player, is just a commentator. And that is exactly what he wants. But to assume such a role underestimates an industry which knows how to play politicians and governments.
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Comments
There are 25 comments to this article
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The Harder They Come
Friday, February 24, 2012 at 12:08 AMMy god Tavish, give up politics, your so terminally shi'te.
Angus McLellan
Thursday, February 23, 2012 at 11:41 PMI'm struck by the fact that the Scotsman is becoming a home for has-been and never-were politicians: Tavish Scott, George Robertson, Michael Kelly, George Kerevan and Brian Monteith among others. I know they're cheaper than employing real journalists, but has it never occured to the management to think that there might be a connection between the decline in quality content and the decline in sales?
Angus McLellan
Thursday, February 23, 2012 at 11:37 PMI'm struck by the fact that the Scotsman is becoming a home for has-been and never-were politicians: Tavish Scott, George Robertson, Michael Kelly, George Kerevan and Brian Monteith among others. I know they're cheaper than employing real journalists, but has it never occured to the management to think that there might be a connection between the decline in quality content and the decline in sales?
Marga
Thursday, February 23, 2012 at 11:22 PMWhat's Tavish Scott doing as a politician when he could make his living either reading palms or as an economist (much the same things these days). No-one else can possibly predict what's to happen with the economy - except Tavish!
Anagach
Thursday, February 23, 2012 at 11:20 PMSo the SNP with talk of oil revenues are providing instability. Whereas the Osborne and Lib Co. randomly adding £2bn North Sea surcharge when they wish is perfect stability.
Aucthtermuchty
Thursday, February 23, 2012 at 11:10 PMWee Eck is trying to run Scotland into the ground , so he can blame the English even more
Pa broon
Thursday, February 23, 2012 at 09:47 PMGood sound bite from the SNP. However as usual it sounds excellent. But all you have to do to realise that's all it is is to look at their track record. Did they consult business on their new supermarket taxes? No; they just rolled them out as a done deal with no consideration or concern regarding the wider implications. So what's the difference between their actions and those of the UK government. None what so ever!
tartanfever
Thursday, February 23, 2012 at 03:07 PMIs Tavish the new replacement for Joan McAlpine ? Think his time would be better spent helping old Ming the Merciless writing the Liberal manifesto for 'home rule', it's only taken a century or so. Talk about not getting the relevant information out in time. What a numpty.
Danielrober2
Thursday, February 23, 2012 at 02:33 PM# 8 billalba ............. The SNP involvement in the power sector is extraordinary. It would be a disaster for Scotland if Scots jobs for the Oil, Gas and Nuclear sector where delivered at the same rate as they are for Renewable Energy. A rate of job creation the SNP are either just ignoring or do not understand. The opening up of new resources is not resulting in sufficient jobs, on the same scale as delivered by Conservative or Labour governments in the past at national level and Lib Dems also at county levels, why not? [could you please provide an answer that does not involve complaining about the big kids at Westminster picking on wee Alec.S]
Intervention
Thursday, February 23, 2012 at 01:24 PMIt wasn't any Unionist Lib Dem who got a good deal; for Shetland by the Council's Chief Executive Iain Clark
Tolmie
Thursday, February 23, 2012 at 01:20 PMSo what are the LibDems, propsing Tavish, you curmudgeonly dolt? More kissing of the spotty buttcheeks of the Labour or Tory parties?
wee-scamp
Thursday, February 23, 2012 at 12:54 PMThis LibDem numpty really hasn't a clue. He claims the oil and gas industry knows how to play politicians and governments so how does he explain that his coalition pal Osbourne hit the industry with a huge and wholly unexpected tax hike without even bothering to discuss it with them and that so far they've been unable to persuade him to take it off again even though it's impacted very negatively on both exploration and production,
Rorybone100
Thursday, February 23, 2012 at 11:34 AMWhat is it with these Lib Dems? I think they feel they must get their tuppence worth in before they are completely wiped off the political map, for such will be their reward for inflicting Tory government on us and repudiating commitments signed in blood on tuition fees. They pole-axed a decent and very able man in Charles Kennedy, who though overly-fond of a dram, could always conduct himself with dignity or without resorting to violence.Too ginger and Scottish to appeal to middle England. And who did they put in his place? A Tory ringer, cut of the very same cloth as Cameron and Osborne. I could well imagine that while a member of the Cambridge University Conservative Association, wee Cleggers was put up to the job of inserting himself in the Liberal party, rise as high as he could and do as much damage as possible. Well rise he did, all the way to the top and he has utterly destroyed the Lib Dems. He'll be the toast of the Tories.
buzzer
Thursday, February 23, 2012 at 11:32 AMI have not read this article but the headline and the author gave it away. negativity negativity negativity!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
Brond
Thursday, February 23, 2012 at 11:32 AM#10 No, I'm arguing that Jo Grimmond got a good deal for Shetlanders but that deal has not been extended to the rest of Scotland. It was an attempt in the 70s (under the auspices of Tony Benn) to divide and rule and one which Tavish Scott seems happy to perpetuate. Incidentally, I'm not an SNP member. And the share of oil will most likely be decided by well-established European law on the continental shelf. I believe length of coastline is a deciding factor; this would mean that Scotland's share would be significant.
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