The United Kingdom has today been accepted as a candidate country for the Extractive Industries Transparency Initiative (EITI). The UK joins over 40 countries that have committed to improve transparency in the oil, gas and mining sectors. UK Business Minister and the UK’s EITI Champion, Jo Swinson, talks to us about reaching this significant milestone and her next steps to ensuring the UK is fully EITI compliant.

I am delighted with the decision from the International Board. It is a significant step towards achieving our aim that all payments made from extractives companies to governments should be completely transparent. Our achievement is a testament to the dedication of industry and civil society.  

Here in the UK, we already have robust reporting requirements in place that formed the building blocks for the UK application for EITI recognition.  The Multi-Stakeholder Group agreed that oil, gas and mining companies should disclose the payments that they make to government once a threshold of £86,000 is reached. Alongside this, government will disclose the payments received.  This will be published together with information on beneficial owners and also background on the sector. 

The reason we committed to signing up to the EITI as part of the UK’s G8 Presidency in 2013, is because we wanted to walk the walk, not just talk the talk about transparency in the extractives sector. We want to lead by example, helping developing countries recognise the role the extractives sector plays in contributing to GDP and raising living standards in local communities.

For example, in Nigeria, EITI reports from the three year period 2009-2011 revealed that a company owed tax payments totaling $8.3 billion. As a result of EITI shining a spotlight onto these payments, $443 million has already been recovered and further investigation is ongoing.

Additionally in the Democratic Republic of Congo, EITI Reports have generated a debate about the accountability of tax collecting agencies.  One of the tax collecting agencies was unable to account for $26 million of royalty payments which may lead to judicial action.

Prior to EITI this would have been impossible as there was no vehicle to follow the money.

This is why greater transparency is so crucial. Only when this information is made available to local people will they be in a position to know how their country’s resources are being used and whether they are really getting a good deal from their government.

Today’s candidacy status is the result of the dedication of the Multi-Stakeholder Group.

What is next?

Whilst we have come a long way, there is still work to do before the UK becomes fully EITI compliant. We now have 18 months to produce our first EITI report and 30 months to undergo validation. This is only achievable if oil, gas and mining companies engage with us and report the payments they make to the UK Government.

I believe the EITI has real benefits for industry.  As the global standard for transparency and accountability, participating in EITI helps demonstrate the significant contribution extractives companies make to the UK economy.

As EITI Champion, I am keen for the UK to continue its swift progress and will continue to work with industry and civil society to ensure the UK becomes EITI complaint by April 2017.

For more information on UK EITI implementation and to see details of our upcoming EITI event on the 18^th November please visit our webpages: www.gov.uk/government/groups/uk-extractive-industries-transparency-initiative-multi-stakeholder-group