Examination of Witnesses (Questions 400-407)
RT HON MR MICHAEL MEACHER MP, MS SUE ELLIS AND MS MARIA NOLAN
MONDAY 15 APRIL 2002
400. So you have been let down by the industry?
(Mr Meacher) I do not wish to cast an accusing finger anywhere in this. I think there are lessons for us all to learn. That is what they told us, and I am afraid it has not happened.
401. I am getting there slowly in my own mind. In July 2001 you were told that there is a problem. When you took the decision that we had no alternative, you did not think that there was an extra cost to Government and you did not think there was going to be any fridge mountain, is that what you are saying?
(Mr Meacher) No, I knew perfectly well that if we did not manage to get the plant in place, there would be a cost.
402. So you were told we could get the plant in place, therefore you did not expect the fridge mountain and you did not expect the extra cost?
(Mr Meacher) That is true. That is true at the time at which we were told it, but I must admit that as we got into the autumn and the plant was not there and it was perfectly clear it was not going to be there, I became acutely conscious that there was going to be a significant cost to Government.
Chairman
403. Minister, you really have dragged your heels over this, because you told the Committee earlier on how you thought desperately for about year to work out what this would signify, and then magically the tablets of stone were handed down in June 2001. Dixons, in their evidence to us, furnished us with copies of letters, extensive correspondence with your Department. 18 September 2001, in a letter with Mr Mark Souhami, the Deputy Chairman of Dixons' signature, he says, "I am afraid that these meetings give me no great comfort either that officials understand the scale of the issue or that they are willing to assist us in finding solutions to the conundrum before us". Then I go on through this mountain and I still find again, under Mr Souhami's signature, a letter of 17 December 2001, in which he is pleading with your Department for a solution. He concludes and say, "You will forgive me if I say that I cannot understand why this nettle cannot be grasped." Now here we are in April 2002. You had the light shine upon you in June 2001. Ten months have gone by and we are still talking about a hoped-for announcement. Do you really think that that was as quickly as you could have produced some kind of workable strategy to deal with this problem?
(Mr Meacher) The truth is that we needed no reminder from Dixons to know that we had a serious problem upon our hands in June 2001.
404. But they kept writing letters about it. They obviously felt there was a need to remind you.
(Mr Meacher) I am sorry if the author of the letter felt that he was not getting a response from the Department. I do not know the details. Obviously I regret that.
405. The Permanent Secretary does, because he got these letters which were addressed to him.
(Mr Meacher) Okay. I am aware of these letters.
406. Do you not talk to the Permanent Secretary?
(Mr Meacher) I am aware of these.
407. You are now?
(Mr Meacher) I am aware that there were letters sent by Dixons and that they were discontented towards the end of 2001. I am perfectly well aware about that. What I am saying is that we knew we had a problem from the middle of 2001, and we did our best to deal with it. The problem is that you can only get investment from private industry if they know that there is a market there. They could have anticipated that there was a market there, as from June 2001. I was doing my level best to try to get companies that have a track record in this involved and trying to invest. As I say, when you are going to invest £2 million, £3 million, and if someone else is going to bear the cost—namely, the Government—you ensure that every condition is in place before you take the plunge. You do not have an economic incentive to get on with it. That is the problem. The only way in which I have been able to try to speed this process up is through saying to the Environment Agency, "When you get applications, obviously you've got to look at all those applications for a licence, you've got to look at those rigorously and stringently, no backing down on the rules, but be as helpful as possible, provide all the information required and try to facilitate these investments as best we can." The other requirement is, of course, the money. I am in no doubt about the importance of being able to place on the table a significant sum of money, but that has to be negotiated and that, of course, is quite difficult. I have been wrestling with that for some considerable time.
Chairman: I think that that is a good place, two days before the Budget, to draw our questions to a conclusion. We shall take that as a representation, and be sure that the Chancellor is made aware of the text of the evidence, and that all that you have said is available for him to view in framing the final text of his Budget speech. Can I thank you and your officials for coming here and for spending so much time. We cannot take away that which you have said, but we can offer you the facility to add to it if there are other things on which you kindly promised us further information. Thank you very much for answering our questions so fully, we appreciate it.
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