Government plans to create a sovereign wealth fund to invest the proceeds of a £1tn fracking boom could be “revolutionary” for the regions.
The plans, which are due to be included in the chancellor’s autumn statement next month, would see the tax receipts from shale gas drilling channelled into an investment fund instead of being used for everyday public sector spending.
The Department for Energy and Climate change has indicated that investment would be UK-wide, but might start in the North, where shale gas is most concentrated and is likely to be extracted first.
Energy company Cuadrilla estimates there could be £140bn generated from reserves in Lancashire alone.
Walter Boettcher, director of research and forecasting at Colliers International, said: “A sovereign wealth fund focused in the North West could facilitate the delivery of the infrastructure and public amenities necessary to make the ‘northern powerhouse’ a reality.”
Savills director of commercial research Matt Oakley said the assumption had been that a UK SWF would join the many funds chasing trophy assets, but argued a fund focused on spending in a single region would be “revolutionary” and could offset opposition to fracking.
