If you change the calculation slightly that is.
Earlier today, the Office for National Statistics confirmed the economy had contracted by 0.3pc in the final quarter of last year, mainly as a result of a collapse in North Sea activity.
However, it revised up its estimates of previous quarters, and said there was 0.2pc growth in 2012, up from the zero growth it had estimated previously.
The ONS said growth in the third quarter was 1pc rather than 0.9pc and that the economy shrank in the first quarter of 2012 not by 0.2pc but by just 0.1pc.
The chief economist at the investment house said the “phantom” recessions reflected continuing weak North Sea oil and gas extraction and when that was stripped out, it revealed that there had never been a ‘double-dip’ in the UK onshore economy.
Mr Ward said North Sea oil production is supply-driven, and while it has been weak because of reserves depletion and unusual maintenance shutdowns, \”these are of no relevance to the wider economy so it is reasonable to strip out the North Sea when assessing underlying trends\”
It\’s a fair enough point.
As long as everyone knows that this adjustment is being made, it\’s a fair enough point that is. What would not be fair would be to announce that we really didn\’t have a double dip recession at all: that would be changing the scoring method for political gain, something of a no no.
Accepting that correction though, we can move on to something much more interesting. Which is who is to blame for that declining North Sea?
No, it isn\’t just that it\’s a declining resource. It\’s actually, at least partially, to do with the idiot Gordon Brown. He raised production taxes on North Sea production up over the Laffer Curve peak. There really was a fall in investment in the area when his taxes started to bite. And given Osborne\’s cut in those taxes there has now been a surge in investment.
And yes, given that we are talking about investment taxes on long term projects there is indeed a several year lag between the imposition of the tax and the effects on the level of activity. Which leaves us with an even more delightful point that we can make.
Even if we include the North Sea, Britain still wouldn\’t have had a double dip recession if it hadn\’t been for Gordon Brown and his over-taxation of the oil and gas business.