Question to the HM Treasury:

To ask His Majesty's Government how many decommissioning relief deeds (DRDs) have been entered into since their introduction; how many DRDs have been triggered to date; what estimate they have made of the cost of the resulting total payments; and what estimate they have made of the potential future liability arising from all active DRDs.

The Government lays a Written Ministerial Statement in Parliament each year updating on the progress of its Decommissioning Relief Deed (DRD) policy. The latest statement was made on 21 March 2024 covering the 2022-23 financial year and indicates 108 DRDs had been signed as of this date. The statement also reports several DRD payments, which relate to 2 DRD claims. The next statement will be laid in due course.

HM Treasury recognise a provision when an amount can be reliably measured and a DRD claim is notified or a DRD claim is pending. These provisions are set out in the Treasury’s Annual Report and Accounts (ARA). The ARA for 2023-2024 indicates a provision of £227m in relation to claims as of the 31 March 2024. The next ARA will be laid ahead of parliamentary summer recess.

The ARA does not include an estimate of the overall financial effect of DRDs because it is unquantifiable. The likelihood of economic conditions at the individual firm level, required for DRD claims to be admissible, cannot be accurately estimated due to the absence of comparable data to use in any calculation.