Finance Bill

Adam Dance Excerpts

Committee of the whole House
Tuesday 10th December 2024 Commons Chamber

[Adrian Ramsay]

As we heard earlier, it is vital that there is strong Government support and a dedicated plan to ensure transition to alternative job opportunities for anyone working in the oil and gas sector. Having a background in the renewable energy sector, I strongly support Government incentives and policies that will help that sector to expand, so that we create jobs and skills. My amendments would reverse the Government’s tax relief on the conversion of oil and gas infrastructure to carbon capture and storage installations. There are many other reliefs in the tax regime that should be addressed, but they are out of the scope of the Bill.

Carbon capture and storage is a complex area. There are different types of technology that use different techniques. I support further research and development in relation to the hard-to-abate sector, but CCS cannot be used as a fig leaf to hide the expansion of fossil fuel operations. In reality, after years of hype, the result is very little carbon—less than 0.1% of annual emissions—being captured globally. Most of the carbon dioxide that has been successfully captured has been used to extract more oil. The UK has also been criticised for targeting most of its CCS at so-called blue hydrogen, the use of which would increase our long-term reliance on gas and generate more carbon emissions.

The proposed tax relief is too blunt an instrument to make a useful contribution to decarbonisation. The role of CCS is still relatively untested, so it is vital that we do not bake in over-reliance on that technology. Public funding for CCS should be restricted to research and development, and to projects that would clearly help to decarbonise hard-to-abate sectors. It absolutely must not be a green light for fossil fuel companies to carry on with business as usual and an expansion of operations. Will the Minister explore the idea of reviewing the measures, in the light of what I have suggested?

[Adam Dance (Yeovil) (LD)]

In October 2021, we Liberal Democrats were the first to call for a tax on oil and gas windfall profits, so I am glad that the Bill is finally scrapping the unfair investment allowance loophole, after years of oil and gas companies not paying their fair share under the Conservatives. I urge the House to adopt our amendment, which calls on the Government to set out exactly how much money is being raised through the scrapping of the investment allowance loophole, and how much money was gifted by the last Government to the oil and gas giants. My constituents in Yeovil deserve full transparency.

I encourage the Government to use the money raised by closing the loophole to address energy and environmental issues impacting my constituents in Yeovil, such as fuel poverty, particularly among pensioners; the need to protect homes and businesses from flooding; the need to support farmers with green investments; and helping homeowners to install clean heating.

In conclusion, we must ensure that our constituencies get a fair deal out of the Bill. If the average taxpayer is expected to pay their fair share, then so must the wealthiest individuals and companies in this country. There cannot be one rule for them and another for the rest of us.