North Sea oil and gas companies are under pressure from the government to invest their profits in accelerating energy production in the country as millions of Britons continue to face rising energy prices.
Business Secretary Kwasi Kwarteng wrote a letter to the companies urging them to provide a clear plan for spending their profits to improve production in the UK.
He also ordered the industry to present proposals for investment in clean energy at a meeting to be held in the coming weeks.
Although the cost of living crisis continues to hit Britons, ministers have not received new funding to ease the pressure on families.
Writing in his letter, Mr Kwarteng argued that domestic energy production was essential for the growth of the British economy and “crucial for reducing consumer bills in the long run”.
“In return for the continued support of the UK government for the sector, the Prime Minister, the Chancellor and I want to see a very clear plan from the oil and gas industry to reinvest profits in the North Sea and, importantly, in clean energy technologies. of the future, “he wrote.
However, Labor criticized the move, saying the letter was “not worth the paper on which it is written” for the millions of people facing rising costs.
Shadow Climate Change Secretary Ed Miliband said the government was “panicking” ahead of financial results due to be released next week, which “will show that oil and gas producers are making huge profits”.
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“After months of opposing the unexpected tax, the government is irritated because it is losing the argument,” he added.
Contingency tax is a mandatory financial levy imposed by the government on certain industries that have had above-average profits due to economic conditions.
Mr Miliband explained that “the only way to really make a difference” is for ministers to introduce a one-off contingency tax on profits made by oil and gas companies.
“Families want action to tackle the bill crisis, not an empty, offensive political twist,” he said.
Ministers opposed the tax, but Chancellor Rishi Sunak opened the door earlier this week.
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