Fracking payouts could bypass councils and go straight to families

A £1bn shale wealth fund unveiled by former chancellor George Osborne in November will set aside up to 10 per cent of the tax proceeds from fracking to benefit the communities hosting wells.

Prime Minister Theresa May is now consulting on amending the scheme so the money can go direct to residents rather than being given to councils or community trusts to spend, as Mr Osborne planned.

It is expected that the new fund could deliver as much as £10m to each community where wells are sited.

Downing Street declined to estimate how much payouts could be worth, but it is thought that individual households could receive between £5,000 and £20,000.

However, planning expert Chris France said the proposal could challenge the “robustness” of decisions on fracking applications, which have been under an intense media spotlight. Environmental campaigners fear the hydraulic fracturing process is highly damaging.

As director of planning for the North York Moors National Park he said the cash payment proposal is unlikely to affect the national park authority or people living within the park’s boundaries as the Government has given a commitment that there will be no drilling within the protected space.

However, from his years of experience in planning he can foresee some difficulties in a potential payments system that goes to individuals rather than community groups or local councils: notably that planning officers are unable to include individual payments when suggesting whether a scheme should be recommended or refused.

He said: “A planning officer’s summary would include people who have sent in objections and support but we would have to put a health warning to say that “x” number of supporters are supporting it for financial gain to themselves and members must not take that into account.”

However, even if planning committee members do abide by the rules and do not take into consideration letters supporting a fracking application purely for their own financial gain, he imagines environmental groups may still seize on a favourable decision with a legal challenge.

“It just questions the robustness of the whole system and muddies the waters,” said Mr France, who suggests campaign groups may simply not accept decisions were made in good faith.

Baroness McIntosh, a former MP for Thirsk and Malton, said if cash payments are made to individuals rather than community groups or councils, it could alter the recommendation from planning officers.

The Conservative politician said: “Would planning committee members give a project the go-ahead? It may have actually led to a different decision in the planning if they knew that they were not going to receive the benefits and instead the money would go directly to individuals.”

She still wants the Government to explore other energy supplies to deal with the country’s shortage before they resort to fracking for shale gas, including incineration.

An end to the self-regulation of the industry is also a must for Mrs May if she is intent on developing this sector further.

She wants to see an over-arching scrutiny body that can monitor wells from a geological perspective and then make recommendations for action if there are concerns