Fracking residents to receive ‘millions’

According to the government, the SWF could directly pay local residents up to 10% of tax revenues that arise from shale gas production over the next 25 years.

A public consultation has been launched to address this proposal, but it will also consider the option of spending the revenue on local projects that boost skills, the government added.

It is right that local communities should benefit from this new industry and that they should have a say in how such money can be put to best use

Energy minister Lucy Neville-Rolfe

Ken Cronin, chief executive of industry trade body UK Onshore Oil and Gas, said: “The onshore oil and gas industry in the UK continues to believe that local people should share in the success of our industry and be rewarded for hosting sites on behalf of others in the country.”

The consultation, which runs until 26 October, will also discuss how local people could be involved in making spending decisions.

Energy minister Lucy Neville-Rolfe said: “It is right that local communities should benefit from this new industry and that they should have a say in how such money can be put to best use.”

Financial secretary to the Treasury Jane Ellison, who unveiled the SWF, said shale gas production is vital for the UK economy.

“We’ve made safety and the environment our top priorities but we also want to ensure local people and communities see extra benefit, beyond the jobs and growth that the safe use of shale gas delivers,” Ellison said.

However, environmentalist group Greenpeace said "cash sweeteners" would not silence fracking concerns.

Greenpeace UK chief scientist Doug Parr said: "The government has tried to sweeten the fracking pill with cash payments before, and it didn't worked. Over the last two years, public opposition has soared and support for shale has tanked.

"People's concerns about climate change and their local environment cannot be silenced with a wad of cash."