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Enterprise Projects

6. Mr. Tom Harris (Glasgow, Cathcart): What action her Department is taking to target enterprise projects at disadvantaged areas and groups. [52003]

The Parliamentary Under-Secretary of State for Trade and Industry (Nigel Griffiths): We are spending £170 million developing businesses in disadvantaged areas and among under-represented groups. The latest round of phoenix funding benefits a further 11 areas, including those in and around Bolton, Bristol, Dorset, Hertfordshire, Isle of Wight, Liverpool, London, Norfolk and Sheffield. It includes the city growth strategies to help inner cities, and the development fund for rural renewal. Similar schemes operate in Scotland.

Mr. Harris: Is my hon. Friend aware that 9 per cent. of the total land area in Glasgow has been designated an undeveloped brownfield site? Does he agree that Government action to prepare such sites for commercial use would have a significant positive impact on employment not only in Glasgow but in cities throughout the United Kingdom?

Nigel Griffiths: I wholeheartedly endorse that. On Tuesday, I visited one such site in Deeside, where this sort of development money is now greatly benefiting the local community and local enterprise. It is particularly important that funds such as those under the community

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development funding initiative in Glasgow go towards developing businesses. I know that such corporate venturing is very important.

Mr. Ian Davidson (Glasgow, Pollok): Is the Minister aware that my constituency has the highest unemployment in Scotland? Will he clarify what is being done to ensure that people from my area can get jobs in enterprises that are supported by his Department over a wider travel-to-work area? What has he done in particular to help Pollok and Glasgow recently?

Nigel Griffiths: I am grateful to my hon. Friend for raising the issues that concern his constituents. I know that he will want to join me in congratulating the Government on their tremendous efforts in cutting unemployment in his constituency, although I would be the first to acknowledge that more must be done and that there are no grounds for complacency. I shall ensure that he is written to with details of all the help that has been available in his constituency from both my Department and the Scottish Executive equivalent.

Brian Cotter (Weston-super-Mare): Will the Minister clarify the bid scheme that the Government are proposing to develop areas? On the face of it, it seems to be very good, but will it effectively deliver for businesses that do not have a lot of resources? There is concern that the application of extra business rates and taxes will be all right for larger concerns but not for smaller businesses, which could be overcome by bigger firms that want to spend more money and pay more business rates to revitalise an area. Will the bid scheme overcome that problem?

Nigel Griffiths: Looking at the mass of the company is an important point. It is obviously much easier to give 10 grants to 10 large bids than to do all the work that might be needed to sub-divide them into 100 bids. I know that officials at the DTI are well aware of that and of the need to help SMEs. I applaud the efforts that have already been made in that direction. I shall draw the hon. Gentleman's words to their attention; we take them to heart.

Coal Industry

7. Mr. John Grogan (Selby): If she will make a statement on the future of the coal industry. [52004]

The Secretary of State for Trade and Industry (Ms Patricia Hewitt): Coal continues to play an important part in the UK's energy mix. Since December 2000, the Government have spent £141 million on the coal operating aid scheme to help the UK coal industry deal with depressed world prices and compete successfully with imports in meeting demand.

Mr. Grogan: On the day that my right hon. Friend meets the chief executive of UK Coal and two weeks before coalfield Members meet the Prime Minister to discuss the future of the coal industry, will she assure me that the British Government will support in discussions in the European Union the concept of investment aid for the

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coal industry, which would for the first time allow aid to be used to access reserves or new faces, rather than largely being restricted to funding losses?

Ms Hewitt: As my hon. Friend implied, it is not possible at the moment, either under the coal subsidy scheme or under regional selective assistance, for the Government to support investment in the coal industry. We are currently in negotiations in Brussels, as part of the discussion about the new coal state aid framework, to see whether it will be possible to provide investment aid for those mines for which it would be appropriate. We do not know what the outcome of those discussions will be, but we are pressing that case.

Mr. Elfyn Llwyd (Meirionnydd Nant Conwy): As the right hon. Lady knows, the European Coal and Steel Community treaty is due to expire in July. She also knows that Spain, France and Germany have said that they will continue with the aid, pending the new treaty in January. I urge on her the need to extend the aid until the new treaty is in place. The colliery manager at Bettws Ammanford rang my hon. Friend the Member for East Carmarthen and Dinefwr (Adam Price) to say that he had regrettably been forced to open redundancy negotiations with his work force, so I urge the Secretary of State to rethink the issue and make an early announcement. The energy Minister visited Longannet recently, but he could do nothing to save that pit. Will she please intervene and save Bettws Ammanford while it is possible to do so?

Ms Hewitt: Of course all of us bitterly regretted what happened at Longannet. We are just thankful that nobody was in the pit at the time and that we avoided the casualties that would otherwise have occurred. I will draw the situation at Bettws to the attention of my hon. Friend the energy Minister and I am sure that he will wish to talk to managers and workers there. When the current scheme runs out, we would prefer to see an immediate transition to a new operating framework, but I stress to the hon. Gentleman that conditions that justified the establishment of an operating aid scheme in 2000—in particular, the very depressed world price for coal—do not really apply now. The substantial amounts of aid that have been given to the industry under the existing operating aid scheme were given on the understanding that the various mines would be economically viable by July this year. We are considering the matter carefully, but it will not be easy to solve.

Mr. Andrew Robathan (Blaby): The Secretary of State referred to the importance of coal in the energy mix. Can she confirm that her energy policies are destroying other Government policies? In particular, the workings of the new electricity trading arrangements are destroying the possibility of reaching targets for combined heat and power and renewable energy by 2010. Is she aware that the NETA have led to a 60 per cent. reduction in CHP production and to some wind farms being closed down because they are no longer productive?

Mr. Speaker: Order. The question is out of order. It is beyond the scope of the original question and the Minister will not answer it.

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Urban Post Offices

8. Adam Price (East Carmarthen and Dinefwr): If it is her policy to support Consignia's proposed network reinvention programme for urban post offices. [52005]

The Minister for E-Commerce and Competitiveness (Mr. Douglas Alexander): The Government are committed to maintaining a nationwide network of post offices. Following the announcement in January agreeing in principle to a compensation package for the urban network restructuring programme to be undertaken by Post Office Ltd., I can confirm that support of up to £210 million will be available for the compensation and investment package for urban offices, subject to state aid and parliamentary approval.

Adam Price: I am grateful to the Minister for his reply, but the Government's policy on the issue is a touch Orwellian. The Conservatives are often roundly—and rightly—condemned for the 3,500 post offices that closed under their Government, but we are told that the 3,000 proposed closures under this Government are an issue of network reinvention and are the operational responsibility of Consignia, even though the Government are the only shareholder. Is not the real underlying agenda the Government's continuing intention to part-privatise, by the back door? As we discovered this morning in Hansard, the Government were involved in the discussions to privatise part of Consignia by selling a share to the privately owned Dutch company, TPG. Our experience in Wales with Dutch mergers is unfortunate—

Mr. Speaker: Order. The Minister will do his best to answer the question.

Mr. Alexander: I am grateful to you, Mr. Speaker. The hon. Gentleman raised the question of closure. The latest figures available indicate that for the year to the end of March 2002 the total number of closures across the country was 262, compared with 547 in the previous year.

Mr. Mark Lazarowicz (Edinburgh, North and Leith): I welcome the funding that the Government are making available to the reinvention programme, which I know will help the post office service in the future. However, I draw to my hon. Friend's attention the situation regarding the Stockbridge post office in my constituency. That area has been without sub-post office facilities for several months. We now have a commitment from Consignia about reopening a post office, but we do not have a date. Will my hon. Friend get in touch with Consignia and ask it to get a move on so that we can have a definite date for the reopening of a post office in the Stockbridge area of my constituency?

Mr. Alexander: Such matters are operational matters for Consignia, but in my dim and distant past as a student I used to use that post office, so I shall certainly be happy to make those representations on my hon. Friend's behalf.

Rev. Martin Smyth (Belfast, South): Does the Minister accept that the policies of successive Governments have made it difficult for small post offices to serve, in both urban and rural areas? Will better links be established with

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the reinvented Consignia to make sure that the people of our country as a whole are served by a Post Office that serves the nation rather than private enterprise?

Mr. Alexander: I certainly endorse that sentiment. From my own constituency, I know of the vital work undertaken not only in rural but in urban areas by Post Office Counters Ltd. That is why we are determined to get the Post Office's finances on to a sustainable basis, and remain committed to a national network of sub-post offices.

Dr. Vincent Cable (Twickenham): Will the Minister confirm that there is a link between the Government's decision to approve the closure of a third of urban post offices and their adoption of an extremely pessimistic target of 3 million for the take-up of post office card accounts? That is only half the number of people that the Government's own social exclusion unit has estimated to be without bank accounts. Do not the Government's assumptions inevitably imply a large-scale migration of custom from post offices to the banking system?

Mr. Alexander: First, I emphasise that the figure of 3 million is an operational assumption, and it is being considered. The Government's determination to move many who are unbanked into the banking system is consistent with our determination to tackle social exclusion in this country. However, we of course want to ensure that post offices are located where they are best able to serve customers, both those who wish to collect benefits and those who have wider retailing needs.

Mr. Mark Field (Cities of London and Westminster): I thank the hon. Member for East Carmarthen and Dinefwr (Adam Price) for raising the matter of urban post offices. We hear a lot about the problems with rural post offices. What is the Minister's relationship with Postwatch, the organisation that looks after the interests of post office consumers? What is his approach to urban post offices such as those in my constituency, of which well over a third are likely to be closed in the next 12 months?

Mr. Alexander: Of course, we maintain a dialogue with Postwatch. The programme will be subject to scrutiny in this House and in Europe. As we move forward with it, it is vital that there is consultation, at a national level with Postwatch, and at the local level of individual sub-post offices. That is exactly the Government's intention.

Mr. John Whittingdale (Maldon and East Chelmsford): Two years ago, the Government said that by keeping the Post Office in the public sector, it could become a "world-class player" providing a service fit "for the 21st century." Today, it is losing £1.5 million a day, it is about to announce thousands of redundancies, and the Government have been forced to admit that they have been engaged in secret talks to the sell the Post Office to the Dutch. Who does the Minister blame for that fiasco, given that just two years ago the Post Office had a golden future? Is it management, the unions, or his own Government?

Mr. Alexander: The hon. Gentleman makes a serious point about the challenges that we face with the Post Office. However, the point would have more credibility if

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a single Conservative Member had attended yesterday's Westminster Hall debate on the Post Office, to which my hon. Friend the Under-Secretary of State for Trade and Industry, the Member for Edinburgh, South (Nigel Griffiths), responded. However, I accept that we face challenges with regard to the Post Office. That is why we have taken decisions to strengthen management that are consistent with a commitment to commercial freedom. It is vital to move the programme forward to achieve the goals that we have set—the delivery of the universal service obligation, and the maintenance of a national network of post offices.

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