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10.3 am
Mr. Denis Murphy (Wansbeck): I congratulate my hon. Friend the Member for Barnsley, West and Penistone (Mr. Clapham) on securing such an important and timely debate. I shall concentrate my remarks on reinforcing those made by the right hon. Member for Berwick-upon-Tweed (Mr. Beith).
The recent announcement of the closure of Ellington, the colliery I worked at until 1994, will effectively end 600 years of coal mining in the great northern coalfield. It will consign 430 men to the dole unless a rescue package can be put together or unless the colliery is sold to a new owner.
Ellington is an important regional asset. It played a major role under both the National Coal Board and British Coal, consistently making a profit. It has made a profit every year under RJB Mining, employing only one third of the work force that existed under British Coal and producing nearly 1 million tonnes of coal a year. That is a magnificent achievement by all concerned, but their reward for that is the sack.
Mr. Budge claims that the colliery faces severe geological conditions and puts it up for sale. To ensure that he attracts a buyer, he takes away the market that Ellington now has with Alcan. That is an insult to everyone who works at the colliery.
I have no doubt, as do the work force, that Ellington has the potential for a long and viable future. There are known reserves at the pit of about 300 million tonnes, which represent fuel to power the next millennium. In order to mine that coal, Ellington needs investment, but that investment has not been made by RJB Mining. There is no doubt that Mr. Budge's company is directly responsible for the announced closure.
However, if Ellington can be assisted through the next four years, a decent future is possible. The pit can continue to supply Alcan and, during the next four years, we are endeavouring to build a new clean coal power station. The Wansbeck Energy Company has received its second tranche of European funding for a full feasibility study into such a project, where we hope to develop on site not only a power plant, but a clean energy centre, manufacturing wind turbines and developing photovoltaics and other forms of renewable energy. Ellington's survival is key to that visionary project.
About £10 million is required to ensure continued production and it would guarantee 430 jobs for the next four to five years. It is fairly obvious that RJB Mining has no intention of investing that sort of money. Sadly, for Mr. Budge, investing in Australia and Indonesia is infinitely preferable to investing in this country. To bleed his UK coal industry to invest abroad is a disgraceful state of affairs. I therefore make no appeals on behalf of RJB Mining.
I appeal, on behalf of the 430 miners who work at Ellington and their families, for the Government to intervene, to grant aid and, if necessary, to subsidise Ellington to protect those jobs. There is an overwhelming social case and a powerful economic case for that. More importantly, the Government have an opportunity to give something back to communities who have given so much to this nation.
There is also an overwhelming social case for assistance. The area surrounding Ellington has been in decline for more than 20 years. We have development
area status, but need an enterprise zone. I urge the Government--whatever happens to Ellington--to provide an enterprise zone for the area. The problems of previous closures are many and varied. The area has been described as an inner city pulled apart. It has been made much worse by the 18 years of neglect and wilful destruction carried out by the previous Tory Government. We have objective 2 and 5b status when, statistically, we qualify for objective 1. With the exception of football, we are at the top of all the bad leagues and at the bottom of all the good ones.
Ellington underpins the local economy, which is still very fragile. Some £10 million each year is paid in wages and we cannot afford to lose that. The only guarantee of a job for the 430 men who work at the colliery is the one that they now have. Despite all the schemes for retraining, the task forces and national, European and regional funding, unemployment is still more than twice the national average.
I am delighted to say that the Government are attempting to address those issues through improved economic development, education and health action zones and all the mainstream improvements that have been announced over the past two and a half years. The closure of Ellington will set that work back even further. There is a powerful economic case to be made. Some £10 million over four to five years will guarantee jobs for the 430 people who work there and will provide an opportunity for work for many more years to come.
Subsidies to private industry are given in one form or another every day--from farming to car manufacturing, although there is, I might add, over-production in both industries. I have no difficulties with such support. In one case, jobs are preserved and expanded; in the other, it preserves a way of life. However, what is good for one industry is surely good for another. Ellington needs regional assistance to re-equip its powered roof supports in order to mine the available coal. The Government can, if they so wish, provide such a subsidy for UK coal. I urge the Minister to make such a case in Europe.
I have touched only on the social and economic arguments, but, in conclusion, I make one last appeal, which stands above all others. Let this Government--on behalf of the nation--give something back to the communities who so desperately need it. On the eve of armistice day, I remind the House that this may be the last chance to make such an appeal for the mining industry. I remind the House of the contribution made to freedom and democracy, and to the wealth of this nation, by miners and our communities. Mining villages the length and breadth of the land have two memorials to our fallen. From Ypres to the Somme and from Tobruk to Arnhem, miners paid the ultimate sacrifice. From the disasters of West Stanley to Hartley, from Easington to Woodhorn, mining communities paid dearly to fuel the industrial revolution and to power this century.
Dr. Michael Clark (Rayleigh):
I shall speak briefly, as we were asked to do so that other Members could speak. It will be easy for me to be brief, because I want only to support the hon. Member for Barnsley, West and Penistone (Mr. Clapham). I congratulate him on initiating the debate.
The hon. Member will remember that he and I served on the Select Committee on Trade and Industry; many other hon. Members will recall the late, lamented Energy Committee, which did such a good job to protect energy in general and the coal industry in particular. The hon. Member will remember that, when we joined the Trade and Industry Committee in 1992, we intended to look at a range of issues, although when I suggested that the Committee examine the coal industry, I was told by one of its senior Conservative members that that would be a reverse takeover of the Trade and Industry Committee by the Energy Committee.
However, within a matter of weeks, we were engaged in a serious inquiry into the coal industry, due to the decision taken by the Conservative Government to shut 70 pits--in fact, only half were to be closed, and half were to be put into review. However, as many Labour Members will be aware, the review was a device for delayed closure and, at that time, we were left with only about 30 pits. There was death by stealth in the coal industry, and that continues at present. In opposition, Labour was going to do so much to help and save the industry, but the death of the industry by stealth continues under the Labour Government, as it did under the previous Conservative Government.
I reinforce two points made by the hon. Member for Barnsley, West and Penistone. First, I was pleased that he referred to clean coal technology. Although we do not lack ideas, we lag behind in the development of that technology. It is a shame that we cannot make progress in that matter, so as to protect not only the coal industry, but our future fuel supplies.
Secondly, the hon. Member referred to the interconnector across the channel. Seven years ago, we gave much consideration to that matter. The amount of energy coming into this country from France is equivalent to the amount that could be obtained from four to five pits. Four or five pits have closed unnecessarily due to the fact that we are bringing in nuclear power subsidised by the French Government. That is not fair competition. That nuclear power is subsidised just as much as the Spanish, French and German coal that was referred to by the right hon. Member for Berwick-upon-Tweed (Mr. Beith) and by the hon. Member for Barnsley, West and Penistone.
I am pleased to follow the passionate speech made by the hon. Member for Wansbeck (Mr. Murphy), who has worked in the industry and in the colliery that is now subject to closure. He said that he would not plead the case of RJB Mining--I can understand that. However, unless, to some extent, one pleads the case for RJB, one cannot argue for the coal industry. I realise that the hon. Gentleman wants to plead the case for the coal industry, and I am sure that he does so, but, in making that case, he will also be pleading for RJB. I know that he does not want to throw the baby out with the bath water.
Since it took over a vast chunk of the British coal industry, RJB has mined 150 million tonnes of coal--80 per cent. of which has gone to the power stations.
The company received no subsidy, but, over the same time, Germany, France and Spain spent £14.5 billion on subsidy. That works out at almost £49 a tonne--more than the selling price of British coal seven or eight years ago. It is a massive subsidy, which permits industry in those countries to have coal that is almost free.
RJB spent almost £400 million on new plant and the replacement of equipment, and a further £1,000 million on accessing new reserves--£1.4 billion is a big investment, but it is only one tenth of the subsidy that goes into the industry in France, Germany and Spain. The hon. Member for Barnsley, West and Penistone pointed out that British coal prices have come down from about 1.4p to 1.15p per gigajoule, but that the world price is between 70p and 80p. How can any coal mine in this country compete with world coal prices--or even European coal prices--without some Government assistance?
A graph of coal production over the past five years shows that, with their big subsidies, French and German output has been steady, and that Spanish output has gone up. The United Kingdom--where there is no Government assistance--is the only major mining country in Europe where output has gone down. As has been pointed out, 7,000 men are employed in RJB alone, and there are huge knock-on effects for those employed in the mining equipment companies referred to by the right hon. Member for Berwick-upon-Tweed.
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