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Column 99that I would rather not hear such comments in the House but that I had no authority to ask the hon. Member for Ashfield to withdraw them.
Mr. Haynes : If the hon. Member for Selly Oak would listen to what is being said from the Chair and keep his mouth shut, we might hear what is going on. I have lost my time. The hon. Gentleman wanted to squeeze me out of the debate by raising stupid points of order. He is a stupid man with a stupid point of order. He should buy a plane ticket and fly away-- [Interruption.]
Mr. Kevin Barron (Rother Valley) : It is always a pleasure to follow my hon. Friend the Member for Ashfield (Mr. Haynes) in debates on energy. I am not sure that I should give advice to the hon. Member for Brigg and Cleethorpes (Mr. Brown), but perhaps next time he will do the House the courtesy of reading the Bill that the Whips tell him to speak to because the Government are running out of speakers. I suggest that he takes it home tonight, reads its four clauses, and gains a knowledge of its contents in case, if the Bill is passed, he is involved later.
Mr. Barron : I have read it several times. Unfortunately, it is unamended, but I hope to look at an amended copy one day. I enjoyed the contribution of the Secretary of State for Energy. It was interesting that most of the Government Back Benchers who spoke in the debate said how much they welcomed the Bill as a way forward to privatisation of coal. I have here an official press release from the Secretary of State for Energy on the day that the Bill was published, in which he says :
"However, this is not privatisation by the back door."
We can safely assume that it is privatisation by the front door. The Secretary of State found himself in a situation that is never very nice for a coal miner--alone down a mine when the lamp goes out. He tried to defend the independent review body procedure and the way it looks into pit closures and said that each pit goes through a "detailed procedure before closure". I shall give him a brief lesson on what happened at a colliery in the constituency of my hon. Friend the Member for Barnsley, East (Mr. Patchett), Barnburgh colliery, which is now closed.
In November of last year, British Coal introduced a new scheme for redundancy payments, with a nine months lifetime. One had to leave the industry on or before 26 August this year. In February this year, the mine manager at the colliery sent a letter to the work force saying that the colliery had to close. In March this year, the work force, in a ballot that was far more independent and private than the ballot to be held in Committee Room 12 tomorrow afternoon will be, and that had more independent scrutineers, decided against the closure of the colliery and
Column 100in favour of an appeal to the independent review body. On 8 May, an area memorandum sent to the colliery was suspiciously leaked to the workers. It said that if they did not accept redundancy by 3 June they would forgo any payments under the redundancy scheme. Consequently, in another ballot shortly afterwards, it was decided to close the colliery.
The National Union of Mineworkers complained about what had happened to the independent review body, set up many years ago to take decisions about whether a colliery has to close, and consisting of three eminent Queen's counsel. Its decision on that complaint has not yet been published, but I have it here. In the preamble it says :
"(c) It follows from this that we take the view that the apparent change in dates affecting the eligibility to enhanced redundancy did interfere with the IRB procedure. If this were to occur again it would undermine our function as an Independent Review Body and thus put the whole review procedure in jeopardy.
(d) Should a similar situation occur again we can see no reason why British Coal should not suspend the operation of the scheme during the period between the IRB reference and decision for the colliery concerned."
At this stage there has been no debate in the industry about the report. British Coal has not gone to any meetings convened about the report. In June, British Coal refused to give evidence to a meeting of all parties concerned that led to the report.
I have a letter signed by Mr. Kevin Hunt, employee relations director for British Coal, dated 26 October 1989, about a letter from one of the QCs involved in the independent review body. Mr. Hunt's letter says :
"As you may know, British Coal are now entering the most intensive phase of negotiations for coal contracts following privatisation of the electricity supply industry. The outcome of these negotiations will have profound implications for the future shape of the industry ; and in these circumstances it seems to us sensible that any discussions about the future of the IRB should wait until this matter has been resolved."
If it is true that the matter has now been resolved, and that there is a bigger future for the British coal industry than people thought, I ask the Secretary of State for Energy to contact British Coal and to ask if it is going to introduce another redundancy scheme for the industry. Will the Government support the proposal that any scheme introduced now will run to the end of the financial year 1992-93, which is mentioned in clause 2, so that we do not have the blackmail to close pits that we have had for a number of years in Britain?
Mr. Hardy : I am grateful to my hon. Friend for mentioning that episode. Would he suggest to the Minister that it would be appropriate for him to advise British Coal that letters of the sort Mr. Hunt sent to the independent tribunal are improper and should never be repeated?
Mr. Barron : That goes without saying, and I hope that the matter will be investigated by the Minister with direct responsibility for British Coal, which is a wholly public company, and that we ensure that it does not happen again with any future colliery closures. I do not often say this about Conservative Members, but the hon. Member for Newark (Mr. Alexander) made a good speech about the future of British Coal and how its employees see the outlook at the moment. In an intervention in the speech of the Secretary of State, my hon. Friend the Member for Midlothian (Mr. Eadie) asked about the likely effects of an increase in electricity
Column 101generation using gas. The Secretary of State said that he was sorry that he could not predict the future. That is exactly what we have been saying for many months--we cannot predict the future. I thought that the Secretary of State was telling us that the British coal industry had a rosy future when he was talking about the coal contracts signed today. However, one cannot predict the future when short- term market reactions take the decisions in the coal industry and as a consequence, a lot of damage is done.
Mr. Neil Hamilton : I am most impressed by the hon. Gentleman's scathing indictment of nationalisation. Does he not regard it as ironical that he is complaining about what is happening in a monopoly controlled industry? Does he not see the opportunities that privatisation opens up for the people who work in the industry? They may claim that a pit has a commercial future, but at the moment there is no means of countering British Coal's view because no one else can take over a pit. With privatisation, that would be a possibility, and that is the ultimate test.
Mr. Barron : I shall comment on that later in my speech. Right hon. and hon. Members on both sides of the House have said that there is nothing in the Bill to put right the wrong caused by coal mining subsidence damage throughout Britain, and we have offered our full co-operation on that. All those involved with the issue say that they want the Government to take action and to introduce comprehensive legislation to ease the predicament that is faced by many thousands of people.
It is typical that the major contents of the Bill are confined to enhancing privatisation prospects or profits of private mines rather than solving subsidence problems throughout the British coalfields. Those people whose homes are in a state of disrepair and who are struggling to cope with the results of coal-mining subsidence have a right to feel badly let down by the Tory Government. There is nothing in the Bill to get over that problem, although it would have commended support from both sides of the House. This is yet another example, if we needed one, of the Government putting the interests of profit for private investors before people's lives and livelihoods. Much has been said about clause 1 and the allowances in it for the coal industry's debt. We have often debated the historic debt that British Coal carries. It would be carried by no other industry. We are not opposed to any write-off of debt. I must correct Conservative Members in that respect. They say that we refuse to write of £5 billion of debt. Clause 1 says that it may be written off. We shall give the Government an opportunity in Committee to replace "may" with "shall" to see whether they are as enthusiastic about it as they seem to be today.
The Secretary of State said that the increase in the ceiling of money to be allowed for redundancies and restructuring of the industry was a broad- brush figure. I have heard it called many things, but that belies his earlier statement about there being no danger to the industry and there not being the redundancies that we have talked about. The British Coal press release belies it too when it speaks of a £1.5 billion ceiling for redundancies and restructuring during the next three years.
It seems that there will be further pit closures, and more than the Government are prepared to admit. My hon.
Column 102Friend the Member for Barnsley, East spoke of the high youth unemployment in his constituency. I think that he said that it is 29 per cent. That figure is repeated in other mining constituencies because of the lack of recruitment, which many hon. Members have highlighted. It is no use talking of restructuring and redundancies and people being left with plenty of money in their pockets when they leave voluntarily or otherwise because the damage is being done by lack of recruitment in the industry. The industry is losing its ability to teach skills, as those who can teach are being lost.
"We have to acknowledge that there is a shortage of Welsh Housecoal".
That is because we do not have enough Welsh miners or Welsh mines. It continues :
"For example, concessionairs will find English coal easier to light and it will be more free burning' than its Welsh counterpart. Some English coals have a slight tendency to cake' in the firebed and this requires gentle poking, once is usually sufficient, to enable the coal to burn right through.
One particularly important feature is that, because English Housecoal produces more smoke than Welsh, it is recommended that more cleaning of chimneys is undertaken to keep the flues clean." That is a disgraceful state of affairs. We have to burn this awful English coal because we do not have enough Welsh miners or enough Welsh pits.
Mr. Barron : I do not know whether to thank my hon. Friend for that intervention, but I do not think that any coal mined in the Rother valley in any way resembles that description. We heard earlier about the lack of anthracite coal being mined in south Wales.
I now come to what the Opposition most strongly oppose. Clause 4 reveals the Government's values in terms of the British coal industry. It is primarily designed to increase the private sector's stake in coal. I am curious to know how the clause came to be in the Bill. At the Tory party conference in 1988, the right hon. Member for Hertsmere (Mr. Parkinson) gave his historic pledge to privatise coal after the next election. At the next Department of Energy questions on 7 November, the hon. Member for Erewash (Mr. Rost) asked him if there would be some liberalisation of the private sector by amending the nationalisation Act. The Secretary of State said that he knew that several people were promoting that idea but that he would prefer to tackle the problem as a whole in the next Parliament.
When the Bill was about to be published, a press release was issued by the chairman of British Coal saying that it was "surprised" at the announcement about clause 4. Like the right hon. Member for Hertsmere, British Coal assumed that the changes had been overtaken by a decision to privatise British Coal. However, that was not the case. The chairman of British Coal also said that the clause would cause operational problems for the coal industry and that British Coal proposed to discuss with the Department of Energy the implications of the proposals. I ask the Under-Secretary why the Government did not discuss the implications and effect of clause 4. Was it because he knew that he would be opposed by British Coal
Column 103before the Bill was published, as he was opposed by the previous Secretary of State on liberalisation of the private sector? Private pits have a deplorable safety record. In 1987-88 there were about three deaths and 27 major injuries in private pits with a work force of about 4,000. In the same year, there were nine deaths and 718 major injuries in British Coal with a work force of about 89,000. In 1988-89 there were two deaths and 25 major injuries in private pits, while the 80,000 work force of British Coal suffered 18 deaths and 684 major injuries. Private pits have a terrible record when compared with public sector pits.
My hon. Friend the Member for Wentworth (Mr. Hardy) mentioned a television programme on Yorkshire Television called "Dangerous Lives". It was shown in August this year. It made a comparison between public sector mining in the United Kingdom and private mining in the United States of America. More enlightening was the section on the private licensed sector, which will be expanded if the clause becomes law.
In the television programme, the chairman of the Federation of Small Mines was asked to comment on accident figures in the United States, which were more than three times the figures for British pits. He said :
"I don't think the figures show it has a bad safety record." He went on to say that the sector compares well with the National Coal Board when it operated in the same manner--that is, in a non-mechanised form. It is precisely the move away from non-mechanised mining that has greatly reduced the rate of accidents in the public sector. We cannot have a sector of British coal mining that has a safety record that claims comparison with mining methods used when three to four miners are killed each day.
In defence of the Secretary of State, may I say that he said that lifting the limit would make modern methods available. I do not think that he has yet talked to the private sector about clause 4. I should like to read to the Secretary of State an extract from an article in the South Wales Argus of 4 December this year. It contains a quotation from Crispian Hotson, the chief executive of Ryan International, one of the bigger private companies in this country and a worldwide concern. On the Government's limit he said : "The government has indicated that it is considering raising the limit to 150 but that would still not have been enough to enable us to operate the pit."
The pit in question was Marine colliery, which had been kept in mothballs by British Coal because it was trying to put together a package to save it. The idea that raising the limit from 30 to 150 will change deep mining methods in private mines is nonsense. Everyone knows what will happen. It cannot be done.
The same television programme reported on a death at Wrytree colliery when a steel cable snapped. The mines inspector said that it was not an accident as the cable had not been properly lubricated, was badly corroded and should have been found by routine maintenance. The owners were prosecuted under the Mines and Quarries Acts and fined £3,000. Many more similar accidents have occurred in the private sector, with prosecutions and owners fined small sums. How many more deaths and major injuries must there be before the private sector learns its lesson? How many more inspectors will there be to control the sector? There
Column 104are 160 private mines, but the number who work in them is unknown. What is the Department's estimate of the expansion of private-sector and opencast coal mining? Where will the coal go when it comes on to the market from the expanded private sector? My hon. Friends and I think it is likely that the Government will close more public mines than they have closed already.
The Government are always consistent when it comes to the British coal industry. They are always looking for a way of turning it back to the good old days when profit came before the people who worked in the industry, and safety was balanced against the need to cut costs. The Labour party has consistently fought for public ownership of this national resource and for the safety, health and welfare of its work force. We shall carry on doing so and try to stop the privatisation of the British coal mining industry.
The Parliamentary Under-Secretary of State for Energy (Mr. Michael Spicer) : Tonight, the Opposition have gone over the top of the slagheap, to borrow the colourful imagery of my hon. Friend the Member for Sherwood (Mr. Stewart). On the day when we introduce a measure to spend yet another £6 billion to £7 billion on the coal industry, on top of the £10 billion that we have already spent--the cost is still running at £2 million every working day--the hon. Member for Holborn and St. Pancras (Mr. Dobson) has the brass neck to talk about us neglecting the coal industry. The mind boggles at what we would have spent had we been looking after the industry.
The sad truth is that the Labour party is beginning to turn our coal debates into a ritual war dance around the totem pole. Perhaps one day we should all strip off our clothes and paint our faces. Then the television cameras would have something on which to focus. Since the hon. Gentleman was promoted to his present office we have learnt that if the Labour party were ever returned to office and he were Secretary of State for Energy, the coal industry would be not just neglected but abolished. In his first few weeks he has come up with a brand new idea for energy policy to which he referred again tonight--that electricity generators will run on a merit order based on environmental costs. Presumably, the greatest polluter will be at the bottom of the pile.
In those circumstances, we would not need a nuclear levy, as my hon. Friend the Member for Exeter (Mr. Hannam) implied. Nuclear energy would be the only source of power that we would be allowed to have. Coal would disappear from sight, overtaken by nuclear energy, gas and oil, even allowing for the clean coal technology to which the hon. Member for Barnsley, West and Penistone (Mr. McKay) is so committed. Indeed, we, too, are committed to it. We have just spent a further £8 million of taxpayers' money on it. At least we can agree on one point : we are in favour of the coal industry and the Opposition are against it for environmental reasons.
The hon. Members for Rother Valley (Mr. Barron) and for Mansfield (Mr. Meale) and my hon. Friends the Members for Sherwood, for Nottingham, South (Mr. Brandon-Bravo) and for Ellesmere Port and Neston (Dr. Woodcock) asked why the question of subsidence has not been addressed in the Bill. I am tempted to give the answer which my hon. Friend the Member for Cannock and Burntwood (Mr. Howarth) has just whispered in my ear
Column 105--because this is a subsidy not a subsidence Bill. That sums up the position, but I suspect that the House will want me to say more about the subject than that.
Mr. Meale rose --
When legislation is introduced, it will be quite complex. We do not think that it is suitable to tag on to this financial measure--it is designed to support British Coal, and we hope that it will pass through all its stages by early spring because it is necessary to provide moneys to British Coal-- a complex measure to deal with subsidence. A considerable amount of work is under way, and it will have to be completed before legislation on subsidence can be introduced. We are reviewing the dispute procedures, which will form a crucial and complex part of any subsequent legislation. We are reviewing also British Coal's early notification procedures. We are considering the results of certain trials and undertaking various analyses. Our aim is to get subsequent legislation right. I can tell the House that half the Waddilove recommendations have been implemented. In 1983-84, there were 52,000 unsettled claims, and now there are 31,000. British Coal has made provision of £260 million in its accounts and is spending about £50 million a year on subsidence. That shows that the matter is being treated seriously.
Mr. Meale : The Minister said during a debate in June that half the recommendations were being implemented. It is the other half that we are bothered about. Fourteen hon. Members from both sides of the House have raised the matter. We have had Adjournment debates, other debates and early -day motions, and dozens of written and oral questions have been asked. I have introduced three Bills on the subject, all of which have been objected to in the Chamber. That has happened on 26 occasions. When will the other half of the recommendations be implemented? That is what we are waiting for.
Mr. Spicer : I have said that we shall introduce legislation that will be based on the White Paper. We have produced a White Paper and the Labour Government, which the hon. Gentleman supported, never dreamt of producing such a document in their day. That must be put on the record. We are committed to introducing legislation on subsidence, but we are not prepared to tag it on to the Bill, which we require to be enacted rapidly.
I shall move on. I have been allowed only 20 minutes to respond to the many issues which have been raised during the debate. I rather agree with the hon. Member for Gordon (Mr. Bruce), who made an interesting speech : it is strange that the Labour party should be voting against a Bill that will provide for further financial assistance for the coal industry. My hon. Friend the Member for Nottingham, South (Mr. Brandon-Bravo) described Labour Members as a whingeing Opposition. I think that he spoke of opposition for opposition's sake. It seems that
Column 106they like some parts of the Bill, and it is surprising that they did not table a reasoned amendment. Instead, they will vote against the Bill lock, stock and barrel. That is an extraordinary step for an Opposition who are apparently committed to preserving and developing the coal industry.
The justification for the Bill is simple. It has nothing to do with the phantom of fattening up for privatisation that is favoured by the Opposition. The Bill has been introduced because British Coal's finances have reached a point where, unless something is done about them, its ability to meet its financial obligations might increasingly be called into doubt. In particular, its debt-to-asset ratio now places a question mark over its ability to service this debt. That is one reason why, since August 1988, British Coal has been financed entirely through voted sums, rather than through borrowing from the national loans fund.
Yes, we wish to privatise British Coal after the next general election ; yes, we believe that that will involve the licensing issues raised directly by the hon. Member for Gordon and others ; yes, British Coal must make a proper return on its capital. Far from fattening up the industry, however, clause 1 will merely prevent it from dying on its feet from consumption and emaciation. More particularly, it provides for deficiency grants to be paid to British Coal, with the effect of allowing it to trade while remaining solvent.
Mr. Spicer : Hon. Members are making it important for me to do so, as I have a good deal of interesting stuff to get on the record. During the debate, understandably, hon. Members have asked whether the deficiency grant payments are commitments will be
open-ended--understandably, because this so-called uncaring, coal- neglecting Government have already put £10 billion of my money and yours into the industry-- [Interruption.] I imagine that you pay your taxes as I do, Mr. Speaker : indeed, I am convinced of it. That money is invested at a rate of £2 million for every working day, so it is only natural that some of my hon. Friends should raise a sceptical eyebrow or two when the Government ask the House to allow them to spend another £5 billion or so. I can assure them that clause 1, which deals with deficiency grants, will cover only the accumulated losses and deficiencies incurred at 31 March 1990. They will comprise three broad categories.
Several Hon. Members rose --
Mr. Spicer : I have an awful lot to get through and I have been given only 20 minutes, but I will give way to my hon. Friend the Member for Birmingham, Selly Oak (Mr. Beaumont-Dark) very quickly, because there is always some fun when I do so.
Mr. Beaumont-Dark : Most of us understand that the House and the country have considerable respect for the miners, whether they be from Wales or from Scotland. Does my hon. Friend agree that the £10 billion that we suggest should be invested in the mining industry is composed of two parts? We believe that mining has a future in this country, and we want as few people as possible to have to go down the mines. We also want those who do go down them to be well remunerated, and we want privatisation--if it happens--to make them better off rather than worse off. Is that not a fair guarantee to give the mining industry?
Column 107Mr. Spicer : Yes, it is.
Clause 4 has clearly been of considerable interest to Labour Members. It has received a good deal of hostility, which my hon. Friend the Member for Tatton (Mr. Hamilton), in a brilliant speech, claimed was an unusual reaction from them. It is only fair that I read out a letter received by our office and headed "Office of the Leader of the Opposition". The letter is dated 26 June and has not, I think, met the public gaze before. It reads as follows :
"Dear Secretary of State,
You will be aware that discussions and assessments have taken place involving British Coal and private concerns such as Ryan International Ltd. about the feasibility of private companies working collieries or parts of collieries that have been closed. The present regulations would of course prevent the establishment of any private colliery that employed more than 30 workers."
So far, so good.
"Could you please tell me"--
the Leader of the Opposition says--
(are you contemplating any changes in the law that would have the effect of altering the present arrangements ;)
(how you view the prospect of part-collieries being worked? ;) (c
(whether you take the view that even within the terms of the existing laws it would be possible for different operations in different parts of closed collieries to be regarded as different private mines?) Yours sincerely"--
"pp Neil Kinnock, MP."
The House must form its own judgment about the contents of the letter, but it is at least open to argument that what lay behind the questions that the Leader of the Opposition put to my right hon. Friend the previous Secretary of State for Energy was his concern that jobs might be lost because the private sector would be unable to work mines that British Coal did not wish to maintain.
If that is what the Leader of the Opposition is suggesting, he seems first to be out of step with his new Front Bench energy team and secondly to be correct. We certainly know of small specialist mines which under the terms of the Bill will be able to be opened and will sell their products in competition not so much with British Coal as with imports.
One example is a proposal to open a mine at Pentreclwyde in south Wales. It would employ over 100 people in an area of high unemployment and would produce tens of thousands of tonnes of anthracite that would otherwise be imported. That is precisely the point that was underlined by my hon. Friend the Member for Brigg and Cleethorpes (Mr. Brown) in his excellent speech. Even the right hon. Member for Llanelli (Mr. Davies) said that British Coal has not done much about anthracite.
The point has, quite rightly, been made time and again that British Coal has a licensing role. After the next general election, we shall certainly take away British Coal's licensing role, but so long as it has it, I hope that it will bear the ability to displace imports in mind when granting licences and setting royalties for the private sector. I hope that that answers the question asked by my hon. Friends the Members for Ellesmere Port and Neston and for Tatton.
Mr. Skinner : The Minister has referred to the Leader of the Opposition's letter. Will he shed light on recent meetings between the Prime Minister and representatives of the Union of Democratic Mineworkers, together with or without the last Secretary of State for Energy? Were these meetings held with a view to providing finance for the UDM? If so, what form did that sweetener take? Has that money been paid to the UDM? If he cannot answer those questions now, I hope that he will answer them in Committee.
Mr. Spicer : I can answer precisely the hon. Gentleman's question. The Union of Democratic Mineworkers, unlike the National Union of Mineworkers with which the hon. Gentleman is closely connected, is interested in pits being developed and worked for the benefit of its members and the country. The future of British pits was discussed by the Prime Minister and the UDM.
If Parliament agrees to this measure, it will be up to those who manage and those who work in the coal industry to make full use of the assets which have been placed in their hands. In stark contrast to the tone of many of the speeches we have heard tonight from Opposition Members, we believe in the future of the British coal industry. This Bill is the plainest possible manifestation of that commitment.
What we are doing today is putting British Coal on its feet, lean and hungry for business--not fattening it up. Once it has been placed on a proper financial footing, it will be able and required to trade without taxpayers' support. This will apply whether it is in the public or the private sector. That is the answer to Labour Members when they talk about fattening up the industry for privatisation. Question put, That the Bill be now read a Second time : The House divided : Ayes 272, Noes 184.
Division No. 7] [10.00 pm
Arnold, Jacques (Gravesham)
Baker, Nicholas (Dorset N)
Banks, Robert (Harrogate)
Barnes, Mrs Rosie (Greenwich)
Beith, A. J.
Bennett, Nicholas (Pembroke)
Bevan, David Gilroy
Biffen, Rt Hon John
Blaker, Rt Hon Sir Peter
Body, Sir Richard
Boscawen, Hon Robert
Bowden, Gerald (Dulwich)
Boyson, Rt Hon Dr Sir Rhodes
Braine, Rt Hon Sir Bernard
Brown, Michael (Brigg & Cl't's)
Browne, John (Winchester)
Bruce, Ian (Dorset South)
Bruce, Malcolm (Gordon)
Buck, Sir Antony
Campbell, Menzies (Fife NE)
Carlisle, John, (Luton N)
Carlisle, Kenneth (Lincoln)
Channon, Rt Hon Paul
Clark, Hon Alan (Plym'th S'n)
Clark, Dr Michael (Rochford)
Clark, Sir W. (Croydon S)
Clarke, Rt Hon K. (Rushcliffe)
Coombs, Anthony (Wyre F'rest)
Coombs, Simon (Swindon)
Cope, Rt Hon John
Davies, Q. (Stamf'd & Spald'g)