NORTH Sea oil and gas companies are to receive a tax boost from the Treasury this week in a major boon to the multibillion-pound industry.
The move is expected to increase investment in the sector amid growing concerns over lower oil prices and higher costs.
An announcement is expected on Wednesday alongside a raft of measures in the Chancellor's last Autumn Statement before the General Election.
There was an outcry four years ago when George Osborne used the Budget to raid North Sea profits, leading to warnings he had put 40,000 jobs at risk.
A Treasury source said last night an announcement on the North Sea was "highly likely" this week.
Mike Tholen, economics director for Oil and Gas UK, said production had fallen in recent years, as had the amount of money the Treasury took from the industry.
He said: "We are not after a free lunch, we want to pay for our own lunch. We just want a little bit more money left to be able to do it with."
Yesterday the Chancellor pre-empted his own statement by announcing an extra £2 billion for the English NHS, and £125 million for Scotland.
Mr Osborne is expected to confirm a continued freeze on fuel duty. There are reports he will scrap air passenger duty for children under 11 and abolish inheritance tax for emergency service workers killed in the line of duty.
Treasury Chief Secretary Danny Alexander will also today unveil a major road-building programme that will include £290m to complete the upgrading of the A1 to Ellingham, 25 miles from the Border, to dual carriageway status.
First Minister Nicola Sturgeon has warned Mr Osborne that, if his Autumn Statement gives Northern Ireland control over corporation tax, it would demolish any argument against a similar transfer to Scotland.
The Tories are keen to keep Northern Irish politicians on side in case of a hung parliament in May. The Northern Irish have argued they need to cut corporation tax to compete with the Republic of Ireland, where the tax is 12.5 per cent compared to the UK's 21 per cent.
Last night the Autumn Statement triggered a separate row after Mr Alexander called on Scottish ministers to spend the extra £125m on the NHS.
"Failing to invest this extra money in health would be to let down the people of Scotland," he said.
But a spokesman for Deputy First Minister John Swinney accused the Tory-Liberal Democrat Government of having "form for sleight of hand on these issues, where promised 'new money' turns out to be no such thing".
The announcement on oil and gas is thought to be part of a package of measures designed to help secure the future of the sector and boost exploration.
Mr Alexander has previously said the UK Government must accept lower receipts from the North Sea in coming years if the industry is to flourish.
The industry says production of offshore oil and gas is subject to the highest corporate taxes in the UK, from 62 per cent to 81 per cent. It also points out that the oil and gas left under the North Sea is harder to extract.
Other plans expected on Wednesday include help for consumers to switch bank accounts in five days instead of seven. Mr Osborne also hinted a future Tory government would continue to protect pensioner benefits.
Mr Swinney has called on the Chancellor to use Wednesday's statement to announce prompt implementation of the new powers for Scotland agreed by the Smith Commission last week.
Labour have pledged to put the plans in their first Queen's Speech if they win the General Election in May. The Tories have resisted a similar commitment.
Labour leader Ed Miliband will use a speech today to accuse the Tories of failing to tackle the cost of living.
He will say: "The test this week for David Cameron and George Osborne is whether they recognise that Britain will only succeed and prosper for the long term by tackling the cost-of-living crisis and building a recovery which works for the many, not just for a few."
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