Leader: No 10's policy U-turns set a dangerous precedent

WHEN is a U-turn the sign of a listening government, and when is it symptomatic of maladroit administration?

Yesterday, four months after the Budget and a vociferous campaign by the North Sea oil and gas industry, the Treasury relented and announced a concession to help some smaller companies develop the more marginal offshore reserves. It is hardly a substantial reversal - Oil & Gas UK, the industry lobby, estimates its value at 50 million. So, while it is welcome, the industry greeted it as no more than "a step in the right direction" and made clear that "much more action" was needed to restore industry confidence.

The Treasury concession came after figures showing North Sea oil production had suffered its biggest quarterly decline since records began more than 15 years ago. While the government was quick to lay the blame for the fall on maintenance shutdowns, the industry continued to warn that some 60 out of 240 potential projects had less of a chance of going ahead since Chancellor George Osborne raised the supplementary rate on North Sea production from 20 to 30 per cent to fund a cut in fuel duty. This, it warned, put in jeopardy both field development and 15,000 jobs across the UK.

Given the volatility of the oil price and the sensitivity of marginal fields and development activity to changes in the tax regime, such powerful objections could surely have been anticipated when the new tax change was first drafted. Arguably the more worrying feature is that this is the latest in a series of policy climbdowns, amendments and, in some cases outright reversals, announced by the government in recent months. The climbdown on proposals to sell off Forestry Commission land in England was the first major example. Since then, we have seen the U-turn on moves to encourage shorter sentences for violent offenders, and modification of the NHS reforms in England. To announce one policy climbdown may be the sign of a listening government. Two looks like carelessness. Three points to a serious institutional failing. Aside from the immediate impression of weakness - of government on the retreat and vulnerable to challenge - it has brought considerable embarrassment to the ministers involved. And this now risks becoming the hallmark of coalition legislation. Once a pattern of announcement then retreat is established, it encourages an expectation that future legislation will follow the same pattern.

However pressing and necessary the government's determination to bear down on a horrific budget deficit, this cannot be used as an excuse for poorly conceived and ill- considered legislation. Policy should be more carefully assessed if every advance is not to be followed by a shuffling, apologetic retreat. Number 10 needs to get a grip and act to avoid the government falling into traps of its own making.