Leatherhead Matters

In 2007 the Exchequer received around 12.5 billion pounds in taxation of North Sea oil, with the average oil price at around $60/Bbl. Oil prices are now at twice last year’s level ($124/Bbl today) so, Government tax receipts are set to soar this year. Add the extra revenue from Vat on fuel at the pump & Alistair Darling is going to have an unexpected , bumper windfall.

But wait a minute. Both Gordon & Alistair have put an absolute clamp on any additional government expenditure. The mantra is that: “there is a freeze on government spending”. They  argue that this is only prudent at a time of economic uncertainty.

Next year, they will argue that their prudence has paid off. In the year before an election must be held, there will be bounty for all. Not because of “prudence” but, because of a windfall from record oil prices.

Sometimes, to be a successful leader, you have to be lucky. Gordon Brown is lucky! He served his term as Chancellor over a decade of unprecedented global growth. Now as PM, his luck may still give him an edge at the next election!