Does the Secretary of State agree that he cannot possibly know the precise rate of return because he does not know the future price of oil? Does not that mean that spending large sums of taxpayers' money to buy into existing licences is nothing more than a massive gamble on the future price of oil?
I agree that we cannot predict accurately the future cost of participation in the oilfields. I also agree that it depends on the price of oil in future and on how profitable individual fields will be.
Will the Secretary of State explain, first, where the money is to come from for this great investment and, secondly, why it is proper to make this investment in oil rather than in nuclear power? Surely he is aware that France is building no fewer than 50 nuclear power stations whereas we propose to build only four.
There is another Question on the Order Paper relating to nuclear power, but the House generally endorsed the Government's conclusion to back British technology in the form of the steam generating heavy water reactor. I think that that was better than accepting the conclusions reached by the CEGB that we should import large-scale American technology, and our decision commanded the wide support of the House.
North Sea oil is already in public ownership. The amount, timing and method of any payments for Government participation will depend upon the outcome of negotiations to which I have invited the companies. This will be one of the factors to be considered in deciding how the financial requirements of the public sector as a whole are to be met over the next few years.
It is a good investment for the oil companies and for the British people. The only way that the British people will be able to get a proper share and benefit from North Sea oil is by negotiating participation.
Does the right hon. Gentleman agree that the way he proposes to finance this project will simply add to the national debt and that a considerable sum will have to be paid each year for the servicing of it? Would it not be wise to leave it as we on this side of the House recommended—simply to tax the profits and not to take over the sovereignty and assets of the oil companies?
The British people could not get what I believe to be their proper share of benefit simply by taxation. Everybody knows that taxation, even if we try to stop up the loopholes, can be avoided. With public participation as we propose, however, we can make sure that we get a proper share.
Mr. loan Evans:
Does my right hon. Friend agree that we put this commitment before the people at the recent election and we were returned with a majority to carry out that pledge? Does he realise that the British people would prefer to have ownership of this industry and have the benefit come to them rather than, as the Opposition wish, have the industry owned by foreign investors and see the benefit of the new resources going abroad?
Will the right hon. Gentleman explain to the House what extra benefit the country will get from investing not the £2,000 million mentioned by my hon. Friend the Member for Ton-bridge and Mailing (Mr. Stanley) but £4,000 million to £5,000 million over and above what will be obtained from taxation? Why cannot the right hon. Gentleman now tell the House and come clean with the country about the real reason for this participation? We have never been told.
There are three reasons, and I explained these in a previous debate. First, we need control of the oil, and we shall ensure that we get it by participation. Secondly, there is the question of making sure that the British people get a proper share, and that cannot be done by taxation. Thirdly, we can have an effective depletion policy only on the basis of public participation.