The UK Government's controversial windfall tax on the country's oil and gas producers has so far raised £600million less than expected.
The initial cash haul from the Energy Profits Levy (EPL) was 24.5% less than forecast prepared by the Office for Budget Responsibility (OBR) in November.
The windfall tax was first introduced in May when Rishi Sunak was chancellor, and was increased in the autumn statement after he became prime minister.
North Sea oil and gas profits are being taxed at 75% until 2028. This is up from the regular rate of 40%, and is being used to help fund massive government subsidies for households and businesses.
The EPL was forecast to raise a total of £40billion by 2028, but there is already evidence that the new tax is hitting offshore investment.
Just last week, it emerged that the North Sea's largest oil and gas producer is preparing to cut hundreds of jobs and shift attention outside of the UK in response to the levy.
Review launched
Harbour Energy confirmed it had launched a review of its British business "to align with lower future activity levels" after the tax rate on operators soared.
The Telegraph says today that the Treasury had expected to raise £7billion from the levy this financial year and £10billion next year.
However, the Government has collected just £3.7billion in extra revenues so far this financial year, according to the Office for National Statistics (ONS).
Much lower oil and gas prices are likely to have been a major factor in this.
Revenue from the EPL in December represents the first payment on 2022 profits, with the second and final instalment due this month.
The OBR said the shortfall "could therefore be a timing effect between these two months, or could reflect the volatility in oil and gas prices resulting in lower EPL liabilities than our forecast assumed".
Assessing the impact
Gerard Lyons, chief economist at Netwealth and a former adviser to Boris Johnson, said that it was too early to assess the impact of the EPL on investment and tax revenues.
But he commented that the "uncertain tax environment" linked tothe oil and gas sector had "not been helpful to investment in the North Sea".
Mr Lyons added: "I wouldn't put it down solely to the windfall tax, but this could always be the last straw that breaks the camel's back. It's just another indication of the unpredictable approach we've had to the North Sea which has often been seen as a cash cow in the past."
Hunt turns to households
Chancellor Jeremy Hunt has turned to households as a source of cheap cash as fears mount over the UK's spiralling debt interest bill.
National Savings & Investments (NS&I) will increase the Premium Bond prize rate to the highest in 15 years at 3.15% in February from 3% in a boost for more than 22million savers.
The savings bank is backed by the Treasury, so when customers invest in its products they are effectively lending to the government.
Economists told the Telegraph the move by NS&I suggested the government was looking to tap households for cheap cash as its debt interest bill soars.
Official data on Tuesday showed public borrowing rose to £27.4billion last month - its highest December level since records began in 1993.
The Office for National Statistics said the increase in monthly borrowing was driven by around £7billion in extra support for households and businesses to pay energy bills, while debt-interest payments climbed to a December record of £17.3billion as inflation hit its peak.