The Chancellor of the Exchequer George Osborne has announced plans aimed at increasing investment in the North Sea oil industry.
The measures to be introduced will see a new tax relief on decommissioning costs and an allowance of £3 billion to commence the opening up of fields to the west of Scotland.
Analysts of the industry and tax specialists said the measures could see a rise in investment from private companies, opening up commercial finance in Scotland for many small businesses in the sector.
In a step said to ensure the UK maximises all oil and gas reserves available, Mr Osborne said the move will be:
“A huge boost for investment in the North Sea.”
The news fell short of impressing Scottish Finance Secretary John Swinney though, who reacted by saying:
“At a time when growth is very low in the economy… the Chancellor has allocated next to no new resources and taken no major initiatives…”
Going on to say he expects the budget to fail to deliver growth to the country, Mr Swinney is clearly not confident it was a Budget for economic recovery.
There was some support for the Chancellor though, with an executive in Aberdeen, Derek Leith, saying he expects the measures in the oil industry to establish stability in an environment poorly hit over recent years.
Decom North Sea, representative for the North Sea’s oil and gas decommissioning industry, also supported the announcement. They claim that more than two million people could benefit from the allowances, with jobs being secured and created through new projects.