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techniques since the 1940s, to allow the working of deposits which are too small for British Coal to consider but too large to be worked by licensees under the present limit. Some of these deposits are of special qualities such as anthracite where British Coal's own local output may be insufficient to meet demand and the market would otherwise be supplied by imports. The increase will therefore open up the possibility of increasing employment and investment in the small mines sector.

I am aware of the concern felt in the House about the safety record of small mines. I am glad that the hon. Member for Barnsley, West and Penistone (Mr. McKay), who raised this issue, is still in the Chamber. However, the overall accident rate in licensed mines has in fact fallen in each of the last three years. I accept that it is higher than in British Coal's mines, but we are dealing with a small statistical population. My worry is that the existing limits condemn licensed mines to work with the equipment and techniques of the 1940s.

Investment in safer and more efficient equipment and techniques is likely to be forthcoming only if the mines can be worked more intensively, which means increasing the manpower ceiling. Indeed, contrary to claims by some Opposition Members, the measure is designed to offer the prospect of greater, rather than less, safety in licensed operations. In the opencast sector, the higher limit now proposed will greatly reduce the piecemeal working of small opencast deposits, and encourage investment in larger and more efficient machinery. Licensed workings will continue to be subject to planning approval and proper conditions of operation and land restoration.

Mr. Michael Welsh : I am grateful to the Secretary of State for giving way on the important issue of the safety of the mines and the individuals who work in them. The increase in miners is not great, but it is more than 500 per cent.; therefore, percentagewise it is large. There will be a tenfold increase--which is large--in the opencast extraction from the pit top. How many more safety inspectors will be employed in the industry to ensure that the extra miners working in the pits are well looked after and their safety, which is supreme and should come before any production, given top priority, with production coming second?

Mr. Wakeham : The hon. Gentleman is right to say that we should ensure that we have the right number of inspectors, as we have. They are up to establishment levels, although there are fewer inspectors now than there used to be. But there are substantially fewer miners than there used to be and the ratio of inspectors to miners has risen substantially. When we came to power in 1979, there was one mine inspector for every 3,185 miners employed by British Coal. The ratio is now one inspector to every 1,998 miners. That is an improvement of 52 per cent. The hon. Gentleman is right : that aspect of matters should not be a subject of controversy between us.

Much has been accomplished over the last five years since the miners' strike. That was a watershed in the industry's history. The Bill, together with the agreement reached with the generators, marks a further crucial landmark for the industry as it adjusts to a changing environment in which its two main customers for power station coal move into the private sector.


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By addressing the losses and liabilities of the past, and by recognising the true value of its assets, we are providing the industry with the opportunity to compete in the market place of the future. The Bill is the measure of the Government's support for the industry, and I commend it to the House.

4.30 pm

Mr. Frank Dobson (Holborn and St. Pancras) : The Opposition welcome those parts of the Bill that are intended to improve the financial position of British Coal. However, we are opposed to the Bill as a whole, especially because it permits more people to go underground in private pits whose safety record, whatever the Secretary of State may say, is quite deplorable.

The main financial provision of the Bill is to write off the debts of British Coal. We welcome that decision. The Government are doing the right thing but for the wrong reason. It is being done only as part 1 of the Government's usual three-stage procedure for privatisation which can be summarised as write-off, sell-off, and rip-off. That is what the Government intend.

Another clause increases the Government grant towards the cost of redundancies in the coal industry. If there are to be job losses, generous severance payments should be made, but it would be better still if we did not have all the pit closures that will lead to redundancies on the scale that is indicated in the Bill. As I have said, we are totally opposed to the proposal to permit more people to work underground in private mines. The safety record in private mines is dreadful, with fatal accidents running at between two and four times the rate in the pits run by British Coal. With that sort of record, we should be exposing fewer people to that sort of danger and not more, and we shall vote against the Bill for that reason. We are also opposed to the tenfold increase in the size of private opencast workings. The record of private operators is bad enough already, as communities living near them can confirm. They do not take enough care, they do not try to protect local communities, and some of them have failed to restore old workings to agricultural use. The Government should have used the Bill to honour their undertaking to improve the arrangements for compensation for damage caused by mining subsidence. They said that they would do that as soon as there was a legislative opportunity. This is that legislative opportunity, and we shall press for the inclusion of that in the Bill. We cannot look at the Bill in isolation. We need to look at the current position of British Coal and its financial situation. We need to look at its past, present and future relations with its major customer, the electricity supply industry. We also need to look at it in the context of the Government's general policies on energy, the environment and privatisation. As my hon. Friend the Member for Bolsover (Mr. Skinner) has said, we need to look carefully at the Bill's likely impact on our ever worsening trade deficit. The Government have many questions to answer. How does the Bill tie in with the coal contract that was announced today? What will it do to electricity prices? Will it promote energy efficiency and conservation? Will its effects on the environment be good or bad? What future does it offer the coal industry? Will it make mining safer or more dangerous? How will it affect communities living near mines and opencast workings? What has the Bill to do


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with the proposed privatisation of the coal industry and how is it tied up with the privatisation of the electricity industry?-- [Interruption.] We have had some instant answers from Conservative Members, but I am afraid that I cannot claim to have their intellectual grasp. Time does not permit me to deal with all those questions as swiftly as they do. However, I am sure that those questions will be seriously pursued by my hon. Friends, unlike the hon. Member for Ashby who, by the way he is behaving, apparently thinks that the idea of a new opencast working in his constituency is a joke. However, those questions will be pursued by my hon. Friends.

Mr. William O'Brien (Normanton) : While my hon. Friend is asking questions of Conservative Members, will he include the protection of the fuel allowance to miners, retired miners and miners' widows? In my constituency, there is grave concern over British Coal's attitude in denying retired, redundant, sick and injured miners and miners' widows their fuel allowance. They fear that that practice will escalate and that those people will become a target for taking away that allowance. Will my hon. Friend ask the Minister to give an assurance that those benefits, which have been fought for by miners, will be protected?

Mr. Dobson : My hon. Friend has put his question effectively ; I could not have put it any better. That is one of the many serious questions that Opposition Members will ask about the future of the industry and how it will be affected by the Bill. My hon. Friend the Member for Rother Valley (Mr. Barron) will deal in particular with safety, opencast working and subsidence and he will want to know why the question of subsidence is not covered in the Bill. I should also like to thank him and my hon. Friends the Members for Cardiff, West (Mr. Morgan) and for Aberdeen, South (Mr. Doran) for the help that they have given me since I became the shadow Energy Secretary. I should like to pay tribute also to the effectiveness of my predecessor. In doing so, I am doing something that the Secretary of State could not do, at least not whilst keeping a straight face. Throughout this decade the Government have been shortsighted, wasteful and environmentally backward. Nowhere has that been more obvious than in energy. Britain's use of energy has been profligate, expensive and harmful to the environment. Instead of carefully husbanding our energy resources, the Government have allowed them to be squandered. Through the period of this Government, coal-burning power stations have provided the bulk of the nation's electricity supplies. They will continue to do so into the foreseeable future. A sensible Government would have recognised that and concentrated effort on improving the efficiency of coal-burning power stations. They would have invested in the research and development of more efficient techniques such as fluidised bed combustion and would have promoted coal-fired combined heat and power stations. They would have put an end to acid rain by cleaning the sulphur from the flue gases. Sadly, they have done none of those things and, as a result, the coal-burning stations--the mainstay of the system--are less efficient, more expensive and more environmentally damaging than they need have been.

A real commitment to those coal-fired stations could have made them cleaner and more efficient and could even have made their electricity cheaper. Instead of that


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commitment, the coal industry and the coal- fired stations have been derided and deprived. They have been derided by allegedly distinguished people in the electricity industry who were supporters of nuclear power and by the advocates of burning oil. They have been deprived of the research and development necessary to improve their competitiveness.

Instead, money has been poured into nuclear research and that truly bottomless pit, the AGR programme. That is the biggest technological foul- up in British history. Common sense and cheapness have had to take second place to the Prime Minister's obsession with nuclear power. That continues to this day. This year, less than 1 per cent. of the Department of Energy's research is going into coal, while more than 80 per cent. is going into the nuclear industry.

In view of all the official propaganda, it is hardly surprising that few people realise that supplies of cheap British-mined coal have been the foundation of success for the electricity industry. Coal-fired stations have kept the show on the road. The cost savings in the British coal industry have been used by the generating board to mask the uneconomic operation of nuclear power stations. If the coal industry and coal-fired power stations had got the credit that they deserved, and were to get it in the future, the coal price contract announced today would not have involved a reduced burn of British coal, nor would the Government face the alternative of increased fuel imports and a further worsening of the trade deficit. I have to warn that when it comes to the balance of trade in energy the situation is not as bright as at first appears ; trends are moving in the wrong direction. At the moment, Britain is self-sufficient in energy because we have an oil surplus. This is fortunate, because without it our trade deficit last year would have been not £14 billion but £22 billion, and the figure would be far worse this year. The Government should take care when they talk of alternative sources of fossil fuels, because Britain's fuel surplus has been whittled away from a surplus of 29 million tonnes in 1983 to one of just 9 million tonnes last year. That is partly because our oil surplus is coming down, but also because Britain imported on average 17 million tonnes of natural gas during each year of the 1980s.

On top of that, last year we imported 12 million tonnes of coal, so this is hardly the time for the Government to be promoting more coal imports or new power stations that will burn natural gas. It is bad enough that the Department of Trade and Industry does nothing about the trade deficit, but it is even worse that the Department of Energy appears to be contemplating making that deficit worse.

The contract announced today between British Coal, National Power and PowerGen is closely related to the Bill, but its real significance is that it signals an about-turn by the Government on electricity privatisation. Privatisation was supposed to secure competition between National Power and PowerGen. This contract means that there will not be any competition. Both have been told by the Secretary of State or his officials how much British coal they will burn between them for the next three years and how much they will pay for it. That agreement has about the same relation to open competition as Eric Honecker had to open government.


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In February this year, the former Secretary of State for Energy, the right hon. Member for Hertsmere (Mr. Parkinson)-- the living embodiment of the triumph of hope over experience--said to the Adam Smith Institute :

"We are devolving to Lord Marshall, to Bob Malpas, to the Area Board Chairmen, to the private generators, accountability for the industry. And we are devolving to them the power to run their business without sovereign interference ... I myself look forward to an electricity industry in which managers are free to manage, and have to meet the demands of customers and competition, not of Ministers and civil servants. That is the principle of privatisation and I am sure it is one that Adam Smith would approve of. It is certainly one that I intend to uphold."

A little later, he left the job, but before doing so he made a speech in the debate on the Report stage of the Electricty Bill in which he summarised his approach by saying :

"We want to get away from political influence and political impositions."-- [ Official Report , 5 April 1989 ; Vol. 150, c. 279.]

During the past few weeks, the Secretary of State has made nonsense of all the arrangements made by his predecessor and particularly everything that he ever said as Secretary of State for Energy. The new Secretary of State has withdrawn nuclear power stations from the sale, but announced that they will provide the baseload on the system and that he will decide the price to be charged for nuclear power. He has now laid down the terms of the biggest contract that National Power and PowerGen will ever sign. So much for the industry being "free to manage" and not having to meet the demands of Ministers and civil servants. The case for electricity privatisation is in ruins and he knows it. His actions speak louder than his predecessor's words ; and they both confirm Labour's case for leaving these natural monopolies in public hands.

The terms of today's contract are made possible only by the Bill. The proposed cuts in the price of coal are possible only because of the write- off proposals. Unfortunately, the cuts in price are not the only cuts in the contract. The new contract signals a reduction in coal sales to the generating companies from 75 million tonnes a year to 65 million tonnes a year--a reduction of 10 million tonnes--over three years. That reduction must lead to further substantial redundancies--there is no way round it. These job losses will come on top of the 12,000 jobs that the leaked Cabinet paper predicted would result as newer pits like Selby move to full production.

What of the price to be charged for this coal? We are told that British Coal will have to sell it at a price that absorbs the first and probably the greatest part of any inflation in each year of the contract. In other words, the cost of coal supplies to the generating companies is to be partly inflation-proofed by the coal industry, and that is a price cut in real terms every year. Will this price cut be passed on to the electricity consumers? Will electricity consumers face electricity prices lower than the rate of inflation, and, if not, why not?

If it is not the miners who are to benefit from their increased productivity and not the books of British Coal and not electricity consumers, whom does the right hon. Gentleman intend to benefit? Is it all part of the fattening up process? Surely, whatever else he does, the least that he can do is to make sure that low-income families and pensioners are protected from any unnatural price increase and his proposed nuclear levy.


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Mr. Ashby : Has the hon. Gentleman noticed that in the other industries that have been privatised price increases have been below the rate of inflation? Will that not apply to electricity as well?

Mr. Dobson : I was talking about low-income families. Perhaps the hon. Gentleman can explain why it was that, in the first two years after British Gas went into private competitive hands, the number of people cut off for non-payment doubled and it had to be forced by a publicity campaign to do something to protect people. In any case, I cannot recall, before the privatisation of any other industry, people from the London business school predicting a 50 per cent. increase in the price of its product within the first few years, because that is what the new private owners would want. I will take more notice of them than of the hon. Member for Ashby.

Mr. Ashby : My constituency is Leicestershire, North-West.

Mr. Dobson : I apologise. It is all the Zouche that does it.

Mr. Skinner : The hon. Member for Leicestershire, North-West (Mr. Ashby) was talking about something but could not get his mouth round the words. I think that he was talking about Rover, and about water privatisation, which will cost the taxpayer about £1.3 billion. However, he dare not speak the words because he is frightened of offending the Prime Minister and she may think that he will finish up voting for the other fellow.

Mr. Dobson : The price charged for Rover was so low that there is some suspicion that Lord Young thought it was a dog.

As I have already said, the main financial provision of the Bill is to write off British Coal's debts. That will require a contribution by the taxpayer of more than £5 billion to join the £5 billion that they have contributed to the water write-off and the £5 billion that they contributed to the British Steel write-off prior to privatisation.

The write-off is intended mainly to further the Government's privatisation programme, and it is the first stage of their three-stage procedure. I admit that this case is unusual, because the Bill applies the technique to two industries at once. The write-off will make British Coal more attractive to potential buyers, but the debt is also being written off to help pay for the cut in coal prices to National Power and PowerGen which was announced today. Without the write-off, British Coal would not be able to reduce prices as it is intended that it should.

It is not the first time that the benefits of coal reductions in the pits have been passed directly to the electricity industry. According to a press statement already quoted by the Secretary of State today, this year the generating board has already benefited to the tune of no less than £850 million. During the past three years the fuel cost to the generating board has come down by 6 per cent., its charges to electricity consumers have gone up by 12 per cent., and its trading profit has gone up by 90 per cent.

Over the past decade such cost savings have found their way into the profits of the Central Electricity Generating Board rather than being passed on to electricity consumers. In the elegant words of the leaked Cabinet paper, all the benefits of the savings on coal prices were kept as higher profits.


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In all justice, the taxpayer, should not have to foot the bill for that write-off ; the generating board should pick up the tab. Therefore, the write-off proposal in clause 1 is not intended just to help the privatisation of British Coal. A lot of the money to be written off has already been spent to help fatten up the electricity supply industry for privatisation.

That is not all. Cheap electricity generated at coal-fired stations has been used to cross-subsidise the expensive electricity generated in the nuclear stations, or, as the Cabinet paper states, allowed revenue to be moved into the nuclear business without leading to large overall increases in price. In other words, it financed the nuclear cost cover-up.

Much of British Coal's debt arises from the CEGB's profit and the cost of keeping nuclear power stations going, when that could not be justified by the price of the electricity that they were producing. Unfortunately, that will continue as the new Secretary of State has decreed that, no matter how much it costs, nuclear stations will provide the baseload. The consumers will be forced to pay for that privilege through the nuclear levy, the coal industry will pay for it through reduced sales of coal, and the miners will pay for it through job reductions in the pits.

I understand that it has been announced that the new nuclear company will be called Nuclear Electric Plc. A buzz word these days in energy circles is transparency. I think that a more transparent and accurate title for the new company might be Irradiated Loss-Makers plc. It will leave the consumers to pay for the losses. If the CEGB were forced to repay the money that it has misappropriated from the savings on coal and bunged into its profits, and if the coal-fired stations were to take over the base load function of nuclear stations, much of the proposed write-off would be unnecessary and there would be much less need for British Coal to draw on the £1,500 million in redundancy subsidies in clause 2. Before moving on to clause 2, we should consider the other aspect of the write-off provisions, which my hon. Friend the Member for Bolsover mentioned. The write-off is intended to be a precursor to the sell-off. We need to try to ensure, at least in the case of British Coal, that it does not turn into the usual rip-off. So, will the Secretary of State tell us his latest valuation of the assets of British Coal if the debts are written off? I hope that he will not tell us that he does not know, because if he does not know the value, how can he claim that he is getting value for money? Has he assessed the value of the land and the non-operational property of British Coal? If he has not, it proves that he is as ignorant and negligent as those people who sold off Royal Ordnance and Rover.

Mr. Wakeham : I think that the hon. Gentleman did not listen to what I said. I said that the write-off might be as much as £5 billion, but that I was not in a position to say what it would be until we had agreed with British Coal and the auditors what it should be, for precisely the reason mentioned by the hon. Gentleman. It would be foolish to agree a write-off until one knew the value of the assets remaining. The necessary valuations will be made on 31 March 1990, the date on which the write-off will take place. I think that the hon. Gentleman is misguided.


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Mr. Dobson : I am always willing to accept that, from time to time, I may be misguided. However, I am not as misguided as the Government's privatisation policy has been.

As the provisions allow for the debts to be paid off, or to be written off, over a lengthy period, many Opposition Members and people in other places are suspicious that the Government and the chosen auditors may find that a write-off is justified if privatisation is to proceed but somehow it will not be justified if British Coal were to remain, quite rightly, in public hands. Clause 2 doubles the amount of grant which the Government may make to British Coal to cover the cost of redundancies during the period of the new contract. The Cabinet paper estimated that job losses would equal one third of the collieries, or about 30,000 jobs. Time has certainly passed since that paper was prepared. Will the Secretary of State tell us his latest estimate of the job losses? Since that paper went to the Cabinet, I am informed that the total work force in British Coal's collieries--and I emphasise the word collieries--has fallen from 80,000 to about 66,000, and that more definite closure proposals are being implemented.

Will the Secretary of State tell us how many closures will take place and which pits are most at risk? Last week I published a list of pits, based on information made public by British Coal. The list suggested those pits that might be most at risk if the Government were to press ahead with 30,000 job cuts. In response, British Coal flannelled but never denied what we said.

The trouble is that the provisions in the Bill undermine any claims made by the Government or British Coal about job security, because the maximum grant for redundancies permitted in the Bill is clearly set at a level which is designed to meet redundancies on the scale referred to in the Cabinet paper. I am sure that the Minister will confirm that it is unusual for the Treasury to agree to back expenditure that it does not expect to take place. Suspicions are also raised because the period covered by the redundancy provisions is extended for one year, so that it will coincide with the third year of the three-year contract which has just been announced. One other factor underlines the plausibility of any Government claim to a new-found commitment to the British coal industry.

Mr. Allen McKay : One thing comes to my mind, and perhaps my hon. Friend will probe it further. The present redundancy scheme caters for weekly payments for people until they reach retirement age. As the average age in the mines is now much lower, do the Government intend to carry on that scheme, or are they going to tell us that they will alter it?

Mr. Dobson : Once again, my hon. Friend, like his colleagues from Yorkshire, has put the question clearly, and perhaps the Minister will answer it in his reply. We will pursue the matter in Committee. There is also the problem of coal imports. National Power and PowerGen have already signed contracts, so we understand, to import as much as 6 million tonnes of coal. Those supplies are clearly intended for the Thames-side power stations, which already receive coal by sea from Northumberland and Durham as they are equipped to deal with colliers. The pits in the north-east are among the cheapest and most efficient in Britain. Some have recently


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received substantial investment, and some have the most enormous workable reserves. Surely it makes no sense for the generating companies to try to replace that source with cheap coal from South Africa and Colombia, which until recently was known better for its coke exports than its coal exports.

There are proposals, moreover, for new coal handling facilities in ports all around Britain. Their total increased capacity is well in excess of 30 million tonnes a year. Some of the proposals come from close friends of the Tory party ; some require private Bills, which are being pushed through the House with Government support. I tell the Secretary of State that, if he wants people to believe that he backs British coal, the least he can do is withdraw Government support from the proposals for new coal handling facilities, particularly those proposed for Humberside. If he does not, we will know where he really stands and why he wants to double the redundancy money in the Bill.

The write-off and redundancy provisions in the Bill have been made necessary by a decade of neglect of the mainstay of our electricity system and its customers. Similar provisions will be required in future unless the Government change their policies. Energy efficiency, conservation and the needs of the environment have been ignored. Electricity prices have been pushed up to fatten the industry for privatisation and to cover up the nuclear losses. The consequences of these short-sighted policies are not some academic matter. In Britain, with its abundance of indigenous supplies of coal, oil and natural gas, the Government have contrived to bring it about that more of our old people shiver and die in a cold winter than in any of those countries in western Europe who do not have our natural advantages and envy our supply of fuel.

The financial provisions of the Bill should put British mined coal in a strong position to provide the bulk of Britain's heat, light and power, but that is no reason to sell it off. The Secretary of State has inherited this threat of privatisation from his predecessor. In view of his problems in sorting out the mess that he inherited in the electricity industry, he should recognise a shambles when he sees one coming. He should abandon the privatisation proposal while he can still blame Cecil. Then he could leave the people in the coal industry to concentrate on their proper job, which is to produce coal efficiently, cheaply and safely to the benefit of themselves, their communities and the whole nation. That is their real job, and he should let them get on with it.

15.3 pm

Sir Trevor Skeet (Bedfordshire, North) : It is quite amazing to hear speeches with as many inaccuracies as we heard from the hon. Member for Holborn and St. Pancras (Mr. Dobson). We get them year after year. One would imagine that we have not put any money into the coal industry. One would also naturally assume that we have not previously had a write-down in capital. In 1965, we had a write-down of £415 million. In 1973, we had another of £450 million. Revised to current figures, that works out at £5.9 billion.

The nation should understand that we are not paying for an economic industry. I happen to be strongly in favour of it. I have never said whether I am in favour of


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denationalisation, but it is a loser. If we examine British Coal's assets, we see that the company is rapidly going bust and would be insolvent tomorrow but for the fact that the Government are putting money into it.

Mr. Hood : I am listening with interest to the hon. Gentleman. Did he use the same multiplier when he argued in the Standing Committee that considered the Electricity Bill that the nuclear power industry should be kept in public ownership? He then supported public ownership of energy.

Sir Trevor Skeet : The hon. Member was a member of that Committee and may have listened to my speech on that subject. I shall not anticipate my arguments on the denationalisation of mines. He will have to wait until another occasion to see whether I subscribe to that idea. I am dealing with the Bill which the Government have presented. It is exceedingly good, and I congratulate them on it. Write-offs in the industry since 1947 work out at something like £10.5 billion. That is roughly half of the United Kingdom's health budget or equivalent to the turnover of our aerospace industries. The money could have been used much more profitably elsewhere, although I agree that if one has a local industry it should be supported. We learned some time ago that, with nitrous oxide and sulphur dioxide in flue gases, the polluter pays, but on this occasion the taxpayer will pay-- it certainly will not be the mighty industry. That is a very unfortunate form of expenditure.

Mr. Eric Illsley (Barnsley, Central) rose--

Sir Trevor Skeet : Other hon. Members, including the hon. Gentleman, wish to make their own speeches, but as the hon. Gentleman was a member of the Standing Committee which considered the Electricity Bill, I shall give way to him.

Mr. Illsley : How does the hon. Gentleman equate his statement that the polluter pays with British Nuclear Fuels plc's discharges from Sellafield and the problems that will occur because of nuclear waste disposal?

Sir Trevor Skeet : There are many forms of nuclear waste disposal. Some proposed by BNFL and the United Kingdom Atomic Energy Authority are extremely complicated. I am not drawing any parallel when I say that the Government are again coming to the rescue of the coal industry. They have consistently vouchsafed the industry. Members of the Opposition Front Bench tell us that everything in the garden is lovely, but United Kingdom coal costs about £41 per tonne, whereas the spot price on international markets is roughly £27 per tonne. Are we to tell electricity users in the United Kingdom that they must pay higher electricity prices because of the higher cost of British coal? Electricity users want cheaper electricity and thus cheaper coal. Opposition Members are saying something entirely different. They are saying that we should keep the price up to benefit coal miners and make the public pay.

Mr. Hood rose--

Sir Trevor Skeet : No. I shall not give way.

I shall give some figures. The hon. Member for Holborn and St. Pancras said that we import coal from Colombia, and it is true that we import a small amount from there at


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$38 a tonne. If it is stripped down, it comes to £30 per tonne, which is much less than the price charged for United Kingdom coal. I agree that the coal industry is doing the maximum to bring down prices, but it has not been able to bridge the gap. I congratulate the Secretary of State on having negotiated an agreement for three years on supplies of foreign coal which will enable the mines to bring down their costs further to compete in the international market. What is wrong with that philosophy?

Mr. Lawrence Cunliffe (Leigh) rose --

Mr. Hood rose --

Sir Trevor Skeet : I wish to say a little more first-- [Interruption.]

Madam Deputy Speaker (Miss Betty Boothroyd) : Order.

Sir Trevor Skeet : I want to make a few more observations because I want to get the facts right. It is always a tragedy when a colliery closes down, whether through exhaustion or because it is uneconomic.

Mr. Hood : Or through Government policy.

Sir Trevor Skeet : It was through Government policy under the Labour Government. They closed more pits than anybody else.

Mr. Hood : That is not clever.

Mr. Allen McKay rose --

Mr. George J. Buckley (Hemsworth) rose --

Sir Trevor Skeet : The hon. Gentleman may say that that is not clever, but it is accurate. Under the Labour Governments, 294 collieries were closed, but under Conservative Governments only 157 were closed. One cannot quarrel with those figures. The greatest number of closures was from 1964-65 to 1969-70, when there were 262 closures, all under Labour Governments. That is not a matter for congratulation. The Labour Government had to face the inevitability that coal was becoming completely uneconomic and had to do something about taxpayers' resources and adjust the number of mines to the correct figure for the United Kingdom.

Mr. Hood rose --

Mr. Allen McKay rose --

Sir Trevor Skeet : The Labour Government faced reality. Now the Conservative Government are telling British Coal to face reality and it is prepared to do so. I do not think for one moment that the Bill is a precursor of denationalisation of the industry. Far from it: it is the infusion of a certain common sense, given that we cannot expect British Coal to continue paying interest of £570 million per year. That is a burden on the industry and the Bill is a way to relieve that burden.

Mr. Hood rose--

Mr. Allen McKay : Will the hon. Gentleman give way?

Sir Trevor Skeet : No, I shall not give way.

Under the planned cuts, I am told that another 30 pits could be closed. That will be a matter of considerable regret. By 1993 manpower in the industry could be reduced


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to 50,000. With 50,000 mineworkers the industry will be thoroughly economic, capable of competing with other industries, and completely independent of Government subsidies.

Mr. Hood rose --

Sir Trevor Skeet : I shall not give way. I have the Floor at the moment. The hon. Gentleman can make his own speech later. The hon. Member for Holborn and St. Pancras said that the average age of miners is about 47 years. That worries me. Even if it is 47, it is low. I hope that the Government will bear that factor in mind when they draw up the redundancy arrangements. In giving redundancy payment to a man of that age one must take into account that he has a long life ahead of him and ensure that he can be retrained for a different purpose in life. He must be given a good payment and be properly resettled.

Mr. Illsley : Will the hon. Gentleman give way?

Madam Deputy Speaker : Order.

Sir Trevor Skeet : I have given way to the hon. Gentleman once. He has just come into the Chamber.

Mr. Buckley : On a point of order, Madam Deputy Speaker. It has been suggested that my hon. Friend the Member for Barnsley, Central (Mr. Illsley) has not been in attendance for the whole debate. He has been here since the debate began and the hon. Gentleman should withdraw his allegation.

Sir Trevor Skeet : I am very much obliged.

Mr. Illsley rose--

Madam Deputy Speaker : Order.

Sir Trevor Skeet : As I said, the Government must consider two factors with regard to redundancy payments. The low average age of miners poses great problems. The other factor is job opportunities in the coal fields. British Coal Enterprise has done a remarkable job in Ebbw Vale and in other parts of the United Kingdom. A great deal of money could be made on land sales. Colliery areas will come up for sale which could be made available to property development companies which could dispose of the land and charge a substantial rent. Indeed, a report in the Financial Times on 27 November said that British Coal was doing just that. I congratulate British Coal on that.

Mr. Hardy : Will the hon. Gentleman give way?

Sir Trevor Skeet : No, I wish to finish making my point. The hon. Gentleman can make long speeches in Committee.

The second factor is diversification, which is important. Everyone knows about the Dutch State Mines, now DSM, in the Netherlands. It does not run coal mines, but operates chemical works. It has diversified completely away from coal. I do not recommend that in the United Kingdom, where we have vast reserves, but diversification into other fields could be profitable and would be useful to mineworkers. Another matter which has been accommodated--Lord Ezra is keen on this--is the purchase of power stations to broaden outlets for coal. I understand that several smaller stations could be developed for coal. That would be useful. RWE in the Federal Republic has been successful on this


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