The prime minister has intervened to allow people who live near sites used for shale gas exploration to be given cash payments so that they benefit from the developments.

In rewriting George Osborne’s plans, Theresa May has ensured local people can share in proceeds from fracking projects. Previous proposals for the Shale Wealth Fund only included cash for community trusts and councils.

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Speaking ahead of a consultation launch on the fund, May said: “The government I lead will be driven by the interests of the many – ordinary families for whom life is harder than many people in politics realise. As I said on my first night as prime minister: when we take the big calls, we’ll think not of the powerful but of you.

“This announcement is an example of putting those principles into action. It’s about making sure people personally benefit from economic decisions that are taken – not just councils – and putting them back in control over their lives. We’ll be looking at applying this approach to other government programmes in the future too, as we press on with the work of building a country that works for everyone.”

Plans for the fund were first announced in the last autumn statement, but the government has changed the consultation to focus on control for local communities. Ministers will insist on proposals to transfer funds directly to households rather than local authorities. Communities could receive up to 10% of tax revenues derived from shale exploration in their area to spend on priorities such as local infrastructure and skills training. The new fund could deliver up to £10m to every eligible community.

A British Geological Survey study of shale gas across northern England estimated a shale gas resource of 1,300 trillion cubic feet. This compares with the current UK annual gas consumption of around 2.5 trillion cubic feet.

Last month, it emerged that Ineos, the $50bn petrochemical giant run by British billionaire Jim Ratcliffe, aims to accelerate shale gas development by lodging up to 30 planning applications in the UK in the coming months. It hopes to start drilling in the north early next year and is expected to begin extracting gas in about 18 months.