Make of this what you will…….

 …or MOTWYW is a useful phrase beloved of members of online forums introducing wild surmises and then distancing themselves from them. The Southampton Football Fans forum has, for example, recently been awash with barmy rumours of imminent transfer signings: ‘Michael Owen has been seen refuelling his car at the M3 service area on his way to Southampton – make of this what you will’.

It does have its uses in the political world of course. Here’s an example.

The Energy and Climate Change Committee held an evidence session on the Government’s supplementary charge on the UK gas and oil industry. The gas and oil producer witnesses were at pains to emphasise what a catastrophe the supplementary charge will be for investment in future exploration and production : a real self-inflicted wound on UK oil and gas plc. And you don’t need to look in the crystal ball, they added – look what happened on both occasions previously (in 2002 and 2006) when supplementary corporate tax (SCT) had been put up. Investment had come crashing down.

Nonsense, Treasury witnesses countered. Just take the 2006 increase. Quite the opposite had happened. Indeed, between 2005 and 2008 ‘in terms of CAPEX, exploration and appraisal investment, there was a real-term rise.’

High stakes here. Will the budget charge have no effect on investment but produce a windfall for treasury, or will it cut into investment seriously and do long term damage to revenue as a result? Two apparently conflicting views. Look at the figures. Well yes, investment did increase substantially in 2005-6 before the last SCT increase, but then dived in the two years afterwards. Over the three years, however, a net increase.  So who is right? They both are, depending on the time period you select.

Make of this what you will….


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