§ 3.29 p.m.
§ The Paymaster-General (Mr. Reginald Maudling)
The subject that has been chosen by the Opposition for today's debate, Britain's energy resources, is, of course, very wide. A wide range of Votes has been chosen as the formal basis of our discussion. Clearly, the subject could not be covered fully and in detail in any speech of less than inordinate length. I shall deal in fairly general terms with our energy problems and, in particular, I shall concentrate on certain points which the Opposition has been good enough to say it would like specially discussed, those points being, efficiency in the use of coal, oil supplies and the nuclear energy programme.
As I go along and develop the theme I want to lay before the Committee, I hope I shall be able to cover those various matters, but before doing that I should like to resolve any doubts there may be in the minds of right hon. and hon. Members by saying that today I cannot make any further statement on the 34 immediate future of petrol rationing. On 15th April I told the House that the Government could not make a further statement until the future supply position was more assured and the Middle East situation at that time was not such as to give us that assurance.
That position still holds good today and the Committee will be aware that a meeting of the Canal Users' Association is now taking place. I cannot, therefore, make any statement this afternoon, but a statement will certainly be made as soon as it is possible to do so.
I want to deal with the general energy problems of the country, the demand which is likely to fall on our energy resources and the best methods we can adopt to meet that demand. I think that this is a convenient time to discuss the matter because we may well be at the beginning of a new phase in fuel policy in this country. Quite a remarkable change may take place in the next few years in the whole energy position.
We have seen many changes in recent years. Before the war, our supplies of fuel were so large as to enable us to make very substantial exports and the problem was then more one of finding markets than of producing fuel. Since the war, we have contended all the time with a grave shortage of fuel. We have been working on quite inadequate margins and coal exports have not been able to make that contribution to the balance of payments which we should like to see them make. Indeed, in recent years we have had to import increasing quantities of oil to supplement our existing indigenous fuel, mainly coal.
That has been the post-war picture, but there have been two developments which may change the picture to some degree. In the first place, events have underlined the difficulties which hang about the import of oil from overseas and, in particular, the rate at which world demand for oil is growing, the pressure on supplies of oil and the means of transportation. The other new factor is the remarkably rapid progress our scientists have achieved in harnessing nuclear science to the production of power for civil purposes.
It is right to say that we may be shortly at the beginning of a completely new phase in our fuel and power policy 35 as a nation, although I think it is important to emphasise that in this field developments take time. They are relatively slow even in the nuclear field, where so many dramatic things are happening, and it will be some years before nuclear electricity starts flowing into the national grid on a large scale.
What are the principles on which we should work in dealing with our energy policy? I suggest that there are two basic principles; first, that we must ensure an adequate supply of energy to meet the demands both of industry and the domestic user; and, secondly, that our indigenous sources of energy should make the maximum possible contribution to our balance of payments. All recent events have underlined the importance of observing those two principles. In the first place, we have learned once again how very serious can be the damage done to our whole economy by a relatively marginal shortage of fuel. In the second place, we have continued to see how heavy can be the strain on the balance of payments of large imports not matched by the export of home-produced fuel.
The lesson to be drawn from that is that in our energy policy our outlook must be bold and one in which we are prepared to take risks. We cannot prophesy with certainty either the demand or the supply, and our policy should be to err on the side of boldness. If there is to be an error, let us try to make sure that we are planning for too much, not too little, energy. Let us see that we are not embarrassed by a shortage of usable fuel. But, clearly, there must be a limit to this boldness. We cannot go ahead without any consideration for costs, particularly because capital costs for sources of energy are rising steadily and are already a very serious burden on our economy.
Our second principle must be flexibility—a horrible word which is used far too often, but for which it is difficult to find a suitable substitute. Many things of a technical and economic nature are changing. On the technical side, the changes in the nuclear field are very rapid. No man can predict front one year to the next where the researches of the scientist will lead us. It is very difficult to be precise about the price relationships between coal and oil, for example. 36 and the changing price relationships over ten years may make a great difference in the total demand for the different fuels. We must be prepared at all times to change our policy to meet changing circumstances.
Therefore, I do not think that detailed planning for a long time ahead is possible in this problem, or indeed, wise. If we try to plan too much in detail we shall import a rigidity which will mean that we cannot adapt ourselves to changing circumstances. As far as possible, we should allow the balancing of demand and supply of energy to be determined by normal commercial considerations.
That should be our first consideration, but the Government must have an overall responsibility for the strategy of fuel policy and must be prepared to intervene, to guide, influence and stimulate where necessary so as to enable us to meet our two main objectives: first, to ensure that our fuel supplies are adequate; and, secondly, that the contribution to our balance of payments from indigenous supplies is as large as we can possibly make it. In opening this debate, I suggest that it should be the object of the Government to set the main framework to ensure that these two main points are met, but to allow the details to be worked out through the normal play and interplay of commercial considerations.
Any study of energy policy must surely begin by trying to assess the demand and the rate at which it will grow and also by trying to assess the supply which will be available to meet that demand, to see how they interrelate and what that interrelation can tell us for future policy. It is very difficult to assess future fuel demand. One should try to deal with it over a fair number of years, because these matters change relatively slowly. I should like to try to produce a picture of the development we may see in the course of, say, the next eight or ten years. I think that 1965 is a convenient date, because the investment plans of the National Coal Board run to 1965 and the recently announced nuclear electricity programme also runs to the end of 1965.
The best estimate we can make is that total inland demand for fuel, which, in 1955, was about 250 million tons of coal and its equivalents, should rise by 1965 to about 300 million tons. That is an increase over the ten years from 250 million tons to 300 million tons of coal 37 and its equivalents. I should explain how that estimate is made and the degree of accuracy which can be attributed to it. Otherwise, if these figures are taken too much as gospel, as they tend to be, they can be more misleading than helpful.
The way we reach that assessment is, first, to make an estimate of the probable growth of industrial production as a whole and then to check that against what seems to be the likely development of individual fuel-consuming industries. For the growth of industrial production we have taken a figure of 3½ per cent. per annum compound, which is equivalent to 3 per cent. a year increase in the national income; and that, by a strange coincidence, means doubling the standard of living in twenty-five years, a target of which we have already heard.
That is a target which is ambitious but surely by no means impossible, and I think it would he absolutely wrong for this country and for any Government to aim at a lower target in the face of the requirements of our people and of the immense economic pressures which will be generated by other competitive economies in different parts of the world over the coming years. We therefore go on the assumption that the annual increase, on an average, in industrial production over the next ten years will be 3½ per cent.
I should, however, explain what the margin of error is. If, instead of 3½ per cent. on average, we get 3 per cent. on average, the difference in the demand for energy will be about 8 million tons of coal equivalent; a ½ per cent. in either direction may make a difference of 8 million tons, which is a big margin of error.
We have to try to estimate how much fuel will be required on the basis of this rate of expansion of our industrial production, and here great uncertainty must arise. If we look at the history of fuel consumption in this country it is interesting to see that in the middle of the last century it was increasing at about 4 per cent. a year, yet by the end of the century it was increasing at only 1½ per cent. a year and between 1913 and 1945 there was no net increase at all in the rate of fuel consumption. That leads one to suppose that after the first outburst of industrial expansion in this country two new influences came to work: first, that de- 38 velopment concentrated more on the lighter industries, which use less power; and, secondly, that modern technological development, for example, electricity, produced new ways of economising in the use of power.
Since 1945 there has been another surprising change in the situation, and the rate of expansion in fuel demand since the war has averaged 2½ per cent. a year, which is much higher than before the war but is still a good deal less than the average achieved in a large number of industrial communities throughout Europe and the rest of the world.
There are many uncertain factors in this matter and it is difficult to make any calculation about which one can be confident as to what will happen in this country over the next ten years. The balance between heavy and light industrial development is different from before the war; there is a much higher proportion of heavy industrial development, with many new processes for aluminium, titanium and cement production, for example, using large quantities of power. On the other hand, I do not think that we can look for the same economies in the consumption of coal by electricity, the same increase in thermal efficiency, as we had before the war, because very much progress has already been made and a continuation of that rate of progress will probably be too much to hope for.
Taking all these factors into account, the estimates which we have made assume that the consumption of energy will go on rising at a rate just under 2 per cent. a year, and it is that calculation which gives rise to the assumption that by 1965 the total inland demands for energy will have risen to 300 million tons of coal equivalent. The best check we can make against the probable requirements of steel, transport, industrial users and domestic users leads us to suppose that that is a reasonable estimate. As I have tried to explain to the Committee, it is however, only an estimate and is obviously liable to considerable amendment in practice. Nevertheless, it is the best estimate that we can make.
In addition to the demand for fuel for internal consumption, we must also plan some increase in net exports. The objective which my noble Friend, the Minister of Power. has in mind, and which he 39 has already announced in another place, is that we should try to cancel out the current imports of coal, which last year were 5½ million tons, and should also try to restore the cuts in coal exports of about another 5 million tons which had to be made in 1955, giving, on balance, a target of increasing the net export of coal by about 10 million tons.
There is, of course, a joker in the pack in the sense that there are different types of coal. The coal which we are bringing into the country is mainly large coal, of which there is a declining proportion available from our own mines due to modern mechanised methods of mining. To produce another 5 million tons of coal, therefore, does not necessarily mean that we can substitute it for the imported coal, because it may be small coal whereas the demand is for large coal which we have to bring in from abroad.
That is the general picture which I should like to put before the Committee A—picture of demand rising to a level of about 300 million tons of coal equivalent in 1965 plus, we hope, another 10 million tons as a contribution to the net export position. That means, in all. an increase of 60 million tons in the decade from 1955 to 1965.
The next thing that one has to decide or to try to estimate is where this additional 60 million tons will come from. First, we look to coal. The present plans of the National Coal Board, which have been set out in some detail and of which the Committee are aware, anticipate that taking deep-mined and opencast together, by 1965 we should hope to get another 20 million tons of coal, that is, 20 million tons towards an increased demand of 60 million tons.
I think it is important to try to estimate to what extent that target will be realised. Coal production recently has been encouraging. The figures of output this year have been good and remain good, and I think that the Committee as a whole are grateful that that is so. On the other side of the picture, one must admit that the figure for coal lost through disputes is still too high, and that must continue to give us a great deal of concern. But if this excellent trend of output can be continued—or, I should say, if it is continued, because it certainly can be continued with will on all sides 40 and efficiency on all sides—then it should be quite reasonable to expect the additional 20 million tons of coal by 1965 as a contribution to the additional 60 million tons which we have to find.
That leaves us, in our forward estimates, to find another 40 million tons of coal equivalent by 1965. That is part of the background to the nuclear fuel policy, and the other part of the background is the current cost to our balance of payments of importing energy which amounts, net, to about £250 million a year. On those two main factors—the 40 million tons gap in coal availability or power availability by 1965 and present cost to the balance of payments of importing fuel—rests the main case for the nuclear energy programme.
There is, however, another case for it: no one doubts that. looking further into the future, the development of nuclear energy in every form will be of major importance to this country and to every industrial country. Our scientists and our engineers have carved a most remarkable place for themselves by an achievement which the whole country salutes. We must support that by being bold in our planning for the use of nuclear energy. We must provide them with scope for their ideas in this country. We must provide them with a market in this country. We must demonstrate by our attitude and our policy the tremendous confidence that we have in our scientists and in the developments which will come from what they are doing in nuclear energy.
For these two reasons—the short-term calculated economic reason and the longterm interest in the whole nuclear development—the Government should have decided to make our nuclear programme the maximum practicable programme with the resources which we can see available at the present moment. As the Committee are aware, that is a programme of from 5,000 to 6,000 megawatts of nuclear capacity by the end of 1965.
There has been much discussion of the economics of this programme and I should like to say a word about them, because I believe that this is a subject which the Opposition particularly wanted to have discussed. There is no doubt at all that the development of this programme of nuclear power stations will be a very heavy burden indeed upon our 41 capital investment industries. The total cost of these new stations, as was recently announced, is £919 million, of which £740 million is the cost of the stations and about £170 million is the cost of the first initial nuclear charge.
There is rather an awkward point in the calculation of the relative cost of nuclear electricity and of energy produced from coal. In a nuclear power station, the primary fuel, uranium, has to be treated as a capital charge, because it is processed while the building of the station is going on, and once it is fed into the furnace may remain in use for from three to five years. Out of the initial fuel cost of these nuclear stations £170 million, something approaching half will probably be for the internal cost of processing the uranium in this country, so that the net charge on the balance of payments may be a little over £100 million over that period.
There is one other factor to take into account. In making these cost comparisons with conventional stations, we do not normally remember to add the cost of the additional investment in the coal mines in order to provide the coal required for the conventional power station. whereas in the case of nuclear stations an investment element for the supply of the uranium is already included in the capital cost of the nuclear station.
Let me now consider the effect of the programme on our investment resources. Whereas in the early 1960s the annual investment programme of the electricity industry might have been about £270 million, it will now, with the nuclear programme, be about £400 million a year, which will throw a big strain upon our investment resources.
What is the justification for this in economic terms? I have said that the programme could bring very great relief to our balance of payments, and that it should be possible to supply nuclear electricity at a comparable cost per unit to that sent out from conventional power stations. Some extremely interesting figures were given the other day by Sir Christopher Hinton, in a lecture in Stockholm, I think, in which he calculated that the cost per unit sent out in 1965 would be just over 0.6d. per unit, which is very close to the cost of electricity generated from coal-fired stations, except perhaps the most modern.
42 Sir Christopher, who has very great experience in these matters, also calculated that it should be possible to get a substantial reduction in the cost per unit over the next twenty-five years. The make-up of this cost is interesting, because about 65 per cent. of the total is for capital charges, whereas in the case of the conventional station this element is only 25 per cent. Therefore, our calculations are liable to a considerable margin of error in either direction.
I think, however, it is fair to say that the rate of interest of 5 per cent. in these calculations is a little artificial, because, in comparing the use of real resources, I think that we should compare not the rate at which the Authority can borrow, but the rate at which other people will have to borrow at the same time, and, therefore, the figure may be a little optimistic. It is also based on an optimistic assumption as to the extent that we can run these stations on base load and the degree of flexibility that we can get into their operation. In this field, once more, I think we are right to be optimistic, because if we cannot be optimistic about our nuclear advances what can we be optimistic about? This is not unreasonable.
The point about the capital charges is important, because if we can reduce the cost per kilowatt installed of the nuclear stations, which at present, is about three times the cost for a conventional station —about £150 per kilowatt against £50—the cost of nuclear electricity can be substantially reduced. As the Committee will be aware, one of the reasons which underlay the trebling of the nuclear power programme was the discovery of the scientists that we can get much greater power from a given size of station than had originally been supposed. I am glad to say that all the evidence we are receiving indicates that this progress is still continuing, and I think that we can confidently look forward to further increased efficiency in nuclear generation, and, therefore, we hope, further reductions in the capital cost per unit.
These are the justifications underlying the nuclear programme. By the end of 1965, which is the period we are looking at, these stations should be producing electricity equivalent to that produced from about 18 million tons of coal a year, though in 1965 itself it will be about 14 million tons. So, if we look again at this 43 gap of 60 million tons of coal equivalent in 1965, we have towards it 20 million tons of additional coal, and 14 million tons from nuclear energy—leaving another 26 million tons of coal equivalent to be made up by imported oil.
That is, I think, the best calculation that we can make; it is based on a reasonable estimate of demand, on the complete fulfilment of our coal production programme, and also on the assumption that the nuclear programme will go ahead without any check or hindrance. Yet, on these estimates, I ask the Committee to observe that we shall need by 1965 about 26 million tons of coal equivalent in the form of additional oil imports, which is an increase of over 50 per cent. on our present imports.
§ Mr. Maudling
Some can be produced in this country, but not, I think, in quantities likely to make any really significant difference, with figures on this scale, which are liable to a difference of 2 or 3 million tons either way. The real lesson to be learnt is that we shall still have to increase our imports of oil from abroad by over 50 per cent. between now and 1965. That is a very important fact for the country to realise in considering our economic prospects.
§ Mr. Gerald Nabarro (Kidderminster)
I do not question my right hon. Friend's figures at all, but the present imports of oil, based on last year's figures, for energy purposes was 26 million tons. My right hon. Friend has said that there would be a 50 per cent. increase, but I understood that the oil companies' calculation, supported by his Ministry, was that in 1965 the figure would be 40 million tons, and not the higher figure which my right hon. Friend has given.
§ Mr. Maudling
My hon. Friend cannot have heard me. I was talking in terms of coal equivalent. A ton of oil works out at 1–7 tons of coal. The coal equivalent of oil used in 1955 was 44 million or 45 million tons. I think my hon. Friend will find that that figure works out quite accurately.
We should look now at the prospective supplies of oil. Can we reasonably expect that it will be physically possible to 44 import oil on this scale, leaving aside the financial difficulties which are involved? The current rate of imports, as my hon. Friend the Member for Kidderminster (Mr. Nabarro) quite rightly said, is about 28 million tons of oil for use in this country. Compared with world production of oil, which rose between 1945 and 1955 from 350 million tons to 750 million tons, our own consumption is very small. Of that world production, British and British-Dutch companies control between them about 150 million tons. including about 35 per cent. of the resources of the Middle East. Quite clearly then, the actual amount of increase which this country will require is relatively small in relation to total growth in world oil supplies and demand.
I should add a cautionary word on investment, because the prospective expansion in world oil output is really fantastic. I have seen an estimate from a very reliable source in the oil industry which states that investment over this decade throughout the free world in oil production will be about £40 thousand million. That is really quite astonishing. That investment can only be paid for, to be controversial for a moment, very largely through the retained profits of the oil companies, and that is the reason they must have them.
I am trying to put before the Cornmittee, as a general picture, this rise in our energy requirements, balanced by increases in our coal output, by our new nuclear programme and, inevitably as well, by increases in our imports of oil. But even that is far from the whole picture, because we must look at some of the supply factors and demand factors. It is not possible to assume that because we have 300 million tons of fuel and 300 million tons of fuel wanted, the two will fit together. There may be too much small coal when the demand is for large coal. Again, in a few years prices may have moved in such a way that the demand for oil as against coal may come out of balance with the supply of the two commodities. We must look at the major individual items in the picture.
As far as I can see, there will be certain important changes in the way in which the demand for energy moves forward. We shall have a rapidly developing demand for coal for carbonisation. This is a particularly important problem. The 45 steel industry's demand for the carbonisation of coal is bound to rise, and that is something which must have special attention from the Coal Board. We shall also have a growing demand for smokeless fuels, in connection with the clean air policy in particular. That is another special aspect of the demand situation.
Again, the demand for secondary fuels, especially electricity, seems likely to grow a good deal faster than the general demand for energy. In fact, in recent years, it has grown much faster than has the general demand. Looking at oil and coal, we must remember that while oil can be substituted for coal over a very wide range indeed there are many uses of oil, particularly in traction, for which coal cannot be substituted. These are special factors arising in the demand situation.
In the supply situation, too, there are special factors. There is, first, the notorious difficulty of the proportion of small coal in our mining output. That proportion has risen, and continues to rise, despite the great efforts of the Coal Board, and this rise is the inevitable concomitant of modern methods of coal getting, particularly power loading. Secondly, there is the very important factor that the development of nuclear power for electricity generating will displace mainly the small, poor quality coal which now goes to the electricity stations, and which cannot. at present, be easily used elsewhere.
Thirdly, there is the question of the output balance at the oil refineries, which is not flexible to an indefinite degree. There is a limit to which we can vary the proportions of light and heavy oils, and if the comparative demand changes considerably it may make considerable difficulties. Finally, there are new possibilities for using fuel, some of which are exciting. I refer, for example, to the idea that we might import liquid methane to use here for the manufacture of gas. That is a technical possibility which is being examined. All these new possibilities will come into play during the next ten years.
There is, of course, the over-riding problem of price relationships and, linked with it, the very great problem of the special cost to the economy of imported fuels. What is to happen to the relative prices of different forms of fuel, and to what extent is it in the country's 46 interest to rely on indigenous fuel when imported fuel may be cheaper? Those are the sort of problems we shall have to face in considering how we are to meet this general growth in the demand for energy over the next ten years.
What are the deductions we should draw for our policy over the next decade? I should like to make some suggestions to the Committee, and I should like to base them on what I said at the beginning seemed to be the two main principles: first, that we should plan to have an adequacy of energy to meet industrial and domestic requirements; and, secondly, that we should plan to make the maximum use of our indigenous resources. Taking, first, electricity and gas, I think that we can have considerable confidence that the plans of these two industries should match up to the likely growth of demand from consumers in the next few years. The development of their investment plans has, of course, been set out in the recent White Paper, which hon. Members will have seen.
In the sphere of electricity, and particularly when thinking of the question of the load factor and the relative price of domestic and industrial electricity—which, in this country, is very different from the price relativity existing in other countries—we shall, over the next ten years, have to pay quite considerable attention to prices and load factor. With this proviso, I think it is fair to maintain that the general plans for the expansion of these two industries are sound.
In the nuclear field, we must press on to exploit the position we have gained, and pay particular attention to reducing the capital cost of the new stations coming forward. Thirdly, there is coal. I think that the figures I have quoted this afternoon of the growing demand for energy must lead to the conclusion that we ought to maintain the current rate of investment in the coal mines, and that the Coal Board's plan for investment in coal production is sound and no more than adequate, and should be sustained so far as total size is concerned. The Coal Board must, however, be prepared to make adjustments within that total programme to adapt it to what may be changing circumstances.
Obviously, the first thing that the Coal Board must seek to do is to develop, in 47 particular. the production of carbonisation coals. That is quite clear. Secondly, there must be—and these two are linked together—more production of the smokeless fuels and more attention given to fuel conservation in the sense of efficient use. We just cannot afford, whatever may be our economic situation, to waste the fuel which we get out of our soil.
It would, perhaps, be convenient if I were to say a word or two now—if I am not wearying the Committee—about fuel conservation, because I believe that this is one of the things that the Opposition wish to have discussed today. There are two separate aspects: efficiency in the industrial use of fuel and efficiency in its domestic use. I believe that a very great deal has already been done to increase the efficiency of fuel utilisation in industry—in particular, the electricity industry has made a notable contribution—but we must not underestimate the fact that a lot of the cheaper and easier ways of saving fuel have already been used.
We must press on as much as we can with the conservation of fuel by economical methods. It is not really sensible to save fuel without regard to cost. Some suggested means of saving fuel are wholly uneconomical. I have seen suggestions involving capital expenditure of £200 per ton of coal. Such costs, of course, put those suggestions quite out of court. Nevertheless, there are many ways of saving coal much more cheaply than that. There are such things as back pressure boilers, and the thermal insulation of buildings—about which we are to hear a good deal in the next few months. I may say that I am grateful to my hon. Friend the Member for Kidderminster for having brought forward his Bill for the thermal insulation of buildings.
Those are means where the capital expenditure involved is relatively low, and it is on those sort of means that we should particularly concentrate for fuel saving. Further, if great savings are to be made, there should be greater training of operatives, and greater efficiency in day-to-day management and operation. Here, it is right to pay a tribute to the excellent work of the National Industrial Fuel Efficiency Service, which has done, and continues to do, an extremely valuable job in encouraging fuel economy generally in industry.
48 When we turn to domestic fuel consumption, the subject gets even more complicated; it is complicated by the clean air policy which has been introduced by recent legislation. As I understand, there are three grades of coal-burning domestic fire which we have to consider. There is the old, traditional type of open grate, which is, I suppose, installed in the great majority of our existing houses. That type cannot really burn coke, it can burn only large coal and a small range of the smokeless fuels. and is very inefficient.
Then there are the improved open grates. introduced since the war, which can take coke as smokeless fuel, but are still not as efficient as they might be. Finally there are the latest types of grate known by the extraordinary name, so the manufacturers tell me, of narrow-throated convectors. That type of grate is a further improvement on the ordinary open grate. In it one can both use coke as smokeless fuel, and also get a very high efficiency.
All these possibilities exist, and we have to encourage wherever we can the development of smokeless fuels for smokeless zones, and the use of more efficient grates. But it should be made clear that the possibilities of getting large quantities of any smokeless fuel other than coke for use in household grates at a price comparable to ordinary coal are not at the moment very encouraging. Some of the nationalised industries, some of the gas boards in particular, are carrying on most interesting experiments in the production of smokeless fuels, and there are already on the market, both privately produced and produced by the nationalised industries, a number of these smokeless fuels which are excellent, but inevitably the cost of processing them is high, and that is a considerable disadvantage.
§ Mr. Maudling
Yes, in some cases. We must endeavour to press on as fast as we can with the development of smokeless fuels which can be burned in a large range of grates and which are not an intolerable price to the consumer.
§ Mr. Shinwell
The right hon. Gentleman has made no reference, although he 49 may do so before he concludes, to the utilisation of waste steam derived from electricity generation, which could be used, if not for heating ordinary dwellings, for district heating in flats which are now being erected. There is a good deal of waste in electricity generation—much more so than in the case of gas production. The only means of conserving our resources and economising is by using waste steam.
§ Mr. Maudling
I agree. That is a very important matter and we had some considerable discussion on it during our recent discussions on the recent Electricity Bill. I think that the electricity boards are aware of the right hon. Gentleman's point. Certainly, considerable advantages can be gained by this means. I believe that there are technical difficulties and limitations, for example, in the extent to which district heating schemes can be made to operate.
§ Mr. Maudling
The actual availability of premises in the right sort of area to be heated by district heating, the availability of water and all sorts of things. One cannot just wave a wand.
On the question of the utilisation of coal, we have this problem of a large increase in the production of small coals. We must press on with new methods of utilising small coals because we must make the maximum use of our basic national raw material which is coal. The Gas Council is pressing on with experiments in the complete gasification of small coal which can be very valuable, if successful.
Secondly, there is the possibility of extracting oil from coal of this kind, a matter to which my noble Friend is giving particular attention and to which he attaches a great deal of importance. I think I am right in saying that the problem of converting small coal into oil is not so much a technical problem in the sense that it cannot be done, but an economic problem in the sense that no one has yet discovered a way of doing it at a reasonable cost. But this we regard in the research programme of the Ministry of Power as one of the most important projects which we have before us.
§ Mr. Arthur Palmer (Cleveland)
Would not the right hon. Gentleman agree that with the development of the nuclear 50 energy programme for power stations, it is likely that in a few years there will be a surplus of this small coal which would otherwise be used in electricity generation?
§ Mr. Maudling
Despite nuclear development, we do not expect the power station demand for coal to fall in the next ten years. I agree that this is an important factor in the planning of our fuel and power policy.
What shall our policy be for oil? In general, as I have said, we can with some confidence feel that adequate oil should be available for us throughout the oil-producing areas of the world. The problem, particularly in Western Europe, is one of transportation. We are examining with care and urgency these problems of oil transportation, many of which, as the Committee will be aware, boil down to the availability of steel, particularly steel plate, which is necessary in the manufacture of large tankers and pipelines.
It would be premature at the moment to say anything in detail about this, other than that the Government are aware of the great importance and urgency of the matter and that we are studying the whole question of how the necessary supplies of oil can be transported in future years. In the meantime, we have also observed the very large orders for tankers which have already been placed throughout the world and which will do a lot, if these orders are maintained, to help to mitigate this problem.
There is another special problem for us, and that is the question of the use of oil in power stations. My right hon. Friend the Member for Sutton Coldfield (Mr. Geoffrey Lloyd), when he was Minister of Fuel and Power, made a number of important arrangements for the development and use of oil in power stations, and, as the Committee will be aware, a number of contracts have been signed for the provision of this oil. I think that there can be no doubt, on the figures that I have given, that we shall need great quantities of oil in the production of electricity over the next few years.
It would be unwise to be misled by the present relative abundance of coal, particularly of power station coal, because over the last two years we have had a situation in which industrial production 51 generally has not been moving ahead. There has been a period or readjustment which we hope and believe will be followed by a period of rapidly expanding industrial production. If that should happen, this possibility of a surplus could vanish overnight.
There may be some case for rephasing the coal-oil conversion, particularly when we realise that we have an important task to build up our fuel oil stocks in the course of this year from the rather low level at which they stand at the moment, and building them up to a satisfactory level may well be assisted by some rephasing of the coal-oil conversion programme, but that is a matter which we must keep under review all the time.
Those are the main factors which will arise in our energy policy between now and 1965. I think that we can look forward to this growth in demand of about 50 million tons. We hope to have an additional demand for 10 million tons for export. This can be met roughly on the lines that I have suggested, by bold thinking and by being prepared at all times to readjust our policy and our thinking in a situation which technically and economically is liable to change rapidly and unexpectedly.
What of the situation beyond 1965? Here, speculation becomes even more unreliable. The development of nuclear power will go ahead. The Central Electricity Authority estimates that by 1965 it will be installing 1,850 megawatts of nuclear power as against 500 megawatts of conventional power. That proportion may change, although no one at the moment would be bold enough to predict that by then we will have seen the end of all conventional power stations. The proportion of electricity actually passed into the national supply system from nuclear sources will be about a quarter by 1965, but by the early 1970s it should have risen to over 40 per cent., so there will be a continuing large increase in the proportion of our electricity generated from nucelar sources, although at the same time the total demand for electricity will be rising.
A number of very important problems are still to be solved, particularly in relation to the flexibility of the operation of these nuclear stations.
§ Viscount Hinchingbrooke (Dorset, South)
Has my right hon. Friend any figures to indicate what would be the kilowatt output of a typical atomic energy electricity station in 1965? It is very low to date, as he knows.
§ Mr. Maudling
It would be unwise of me to say. That is one of the most difficult technical matters. Week by week scientists are producing new possibilities, but I would not like to give any figure. We are aiming at a total programme by 1965 of 5,000 to 6,000 megawatts, but the number of stations needed to produce that amount of power is not entirely certain. Obviously, the fewer stations we have to produce the power, the better it is from the point of view of the amenities of the countryside.
Much attention is being given to obtaining the maximum power possible from individual stations. Undoubtedly, we shall be hoping to introduce something in the nature of the breeder type of reactor which, so far as I can understand, produces its own fuel as it goes along; and, therefore, that is a further economy from the point of view of our balance of payments.
Also, we must pay attention to the possibilities of the direct use of nuclear heat in industry. One of the disadvantages at the moment of the nuclear source of energy is that it can only be applied to the generation of electricity. That is itself an experiment. If we can find means of producing nuclear power directly for industrial processes, that will be an advantage. There are many other exciting possibilities being examined by the scientists, including the underground gasification of coal to which the Coal Board is paying a good deal of attention, slagging gasifiers and fuel cells, none of which I understand in detail, but which, I believe, hold considerable possibilities for the future.
In that period and looking beyond 1965 our basic energy source is, and will remain, coal. I have no doubt that our main policy must be to ensure that we make the maximum use of the coal underground in this country. That will mean changes in the way in which it is used. It will mean adapting it to new processes. It will mean using new carbonisation methods and possibly more coal being used for oil synthesis and for processing to chemicals.
53 In every case I think that when talking about nuclear power we should not talk about it displacing coal but rather releasing coal for other purposes. It is most important to get that point across to the people of the country. It is also important to realise that price relationships will have a part to play and the price relationship between home produced coal and imported fuel may become increasingly important and produce increasing problems as we pass into the second part of the 1960s, but all this lies very far ahead.
I have tried to cover the main points which the Opposition have in mind. I have tried to set before the Committee the picture as we see it, as best I can, of our development of energy policy over the next ten years. It has been our boast that our energy policy before the war was a great source of strength to our country. Recently, we have had considerable difficulties for many reasons and now, with the genius of our scientists and the good will of our people, I believe that we can restore once again the position whereby this country's economy was proud to stand in the forefront of energy development throughout the world and where the people as a whole will be able to gain the full benefit to which they are entitled.
§ 4.23 p.m.
§ Mr. Alfred Robens (Blyth)
We are all grateful to the Paymaster-General for his exposition on the nation's fuel and power policy, particularly in relation to the investment programme as indicated in the White Paper.
I must confess to receiving his statement with rather mixed feelings. I could agree with a good deal that the right hon. Gentleman had to say, but I am bound to confess to some disappointment with some aspects of what he said, which I will deal with as I go along. One observation I would make in that regard is that I thought it was not so much the Government's policy he was announcing as their wishes and desires. There was rather too much "encouraging" people to do this and that and "pressing" industry to do the other when dealing with this very vital question of coal conservation, about which much more must be said and about which there must be a much more vigorous and practical policy on the part of the Government.
As the right hon. Gentleman has already indicated, all the work that can 54 be done easily and economically and quite simply by the industrialists and others is perhaps being done. It is not there that the greatest saving of fuel will be made; it is in the much greater field of thermal insulation, the using of waste heat from power stations, and so on, that really great savings can be made. The right hon. Gentleman passed over this far too lightly. While I do not wish to make that the main purport of my remarks, I think that we shall have to return to it again during the debate.
There is one matter upon which the right hon. Gentleman touched which has really nothing to do with the debate at the moment but to which I ought to make a reference, and that is when the right hon. Gentleman disappointed us all at the beginning of his speech by saying that he had nothing at all to say about petrol rationing. I understand the reasons why the Government have felt it necessary to continue petrol rationing, but I think that the right hon. Gentleman and his advisers must be completely out of touch with what is happening.
The truth is that there is not petrol rationing in this country at all. There is scarcely a petrol service station which is not breaking the law by coupon banking and by allowing motorists to draw the amount of petrol they need without relation at all to petrol rationing. I do not understand why the Government have permitted the world to come to the conclusion that, because of the situation in Jordan, the whole of the British economy once again stands trembling on the brink and that petrol rationing must be continued after they had decided, before the Jordan incident, that petrol rationing could be ended. We are the only country in Europe with petrol rationing. Anywhere on the Continent petrol is readily available.
The garages have ample stocks and the tanks at the refineries are well filled. The truth of the matter is that the Government have not looked at this position realistically enough. They are taking an extremely careful line. It seems to me to be quite out of keeping with what is actually taking place today for the Government to go on even believing that petrol rationing is in operation, because it is not. We may perhaps leave the matter there for the time being, because I want to deal with the question of the capital 55 investment programme, particularly in regard to nuclear energy.
Before we rose for the Easter Recess we had some long debates on the Budget and on the economic situation, when we talked about production and returned to the theme familiar to the Lord Privy Seal, referred to again this afternoon by his right hon. Friend, of doubling the standard of living in twenty-five years. There is nothing magic about that. We all want to see it. Indeed, if we can do more than that so much the better.
The truth is that we can double the standard of living only if we get the industrial production necessary to provide it. That is the important factor and not the way in which we shall be able to distribute the national wealth when it has been created. That is what we should be considering when we are dealing with the nation's fuel and power policy, because production is based entirely on the amount of power at the elbow of the worker. It is clear that as we develop industry, technically the automative processes will demand more and more power. If we are to get increased production from our fairly static manpower we must take out of industry all the physical and laborious tasks and provide the machinery which can do that.
Then, again, as the standing of living of the people increases there will be greater demands upon the power industries for amenities in the home and in travelling and things of that kind. There is no reason at all why we should not have the best amenities and the use of power in the housewife's kitchen. There is no reason why we should spend the whole of our time and take a great deal of pains in improving efficiency in industry if at the same time we do not apply our minds also to improving efficiency within the home and lightening the burden of the housewife, who perhaps does much harder work than the industrial worker. For the housewife who has to look after her family without assistance, refrigerators, electric cleaners and other gadgets about the house should be part and parcel of the nation's household requirements and not merely luxuries, as some of those things are regarded as the present time.
I suppose we shall move on to things like electric dispose-alls and electric deepfreeze machines and many other things 56 which will help considerably the amenities in the home and which will demand this additional drag upon power supplies. We cannot, therefore, get a doubling of the standard of living in the next twenty-five years unless we produce considerable power to provide the necessary amount for industry and at the same time provide sufficient to improve the amenities of the people themselves.
If one looks at the relative productive efforts of people throughout the world, one sees at once that the American people have the highest standard of living. Anyone who has been to the United States and studied industry there must come away with one or two rather vivid impressions. For myself, I came away with the impression that whilst it was true that the American worker had a higher standard of living than anyone else in the world, it was not because he worked harder or because he worked longer. It certainly was not because he was more skilful. It was because he had about eight horsepower at his elbow compared with three or four horsepower at the elbow of the British worker. In other words, he got more bread for less sweat.
There is no reason at all why we should not provide that same amount of horsepower at the elbow of the British worker. If we could get British productivity to the point which has already been attained in the United States—and there is no reason why it should not be done here —what a complete difference it would make to the economy of this country. We could carry our defence burden, for example, with reasonable ease. Our import and payments deficit troubles with the outside world could be managed without recurring crises. The burden of taxation could be reduced. Consumer standards of living could be considerably increased, either by increasing the consumer's own spending power or by increasing the State services, or by a combination of both. We could get the hours of work reduced and the savings of people and businesses could be greatly increased. These, in turn, could be reinvested in technical development and for the development of under-developed resources abroad.
§ Mr. John Harvey (Walthamstow, East)
While I am sympathetic to what the right hon. Gentleman is saying, I hope he will bear in mind that the Americans have 57 one great advantage that we do not have and cannot have to the same extent, and that is the large-scale economies that are possible in the huge enterprises which make it profitable to instal types of equipment that many of our own industries cannot do.
§ Mr. Robens
Yes, there are numerous features, and the large market which they have is certainly one of the great contributory factors. I understand that we shall shortly be talking about the European Common Market, however, and it may well be that in that direction we shall have a market just as big as or even bigger than the United States has within its boundaries. I do not ignore the fact that large-scale production is, of course, one of the assets, as is the fact that America has an enormous amount of indigenous raw materials—power, oil, and so on—within its borders.
Nevertheless, even if by the policy that is now set forward we provided that amount of horse-power at the elbow of the British worker, I do not suggest that that would in itself provide the production we need. It means that we must have efficient management and better relations between workers and managment. We have got to apply rather better than we do scientific knowledge to industry, and we must do it much more quickly. We must have alive and alert salesmanship and service after sales abroad. All these things are necessary, but it is not the slightest use having even those things on the management side unless we have the power. We come right down to power, therefore, as being the fundamental basis upon which our prosperity is built.
Lord Heyworth, in his chairman's report to the recent meeting of the shareholders of Unilever, said:It is not by the discovery of new and better products that we keep our place in the sun.. It is by improving methods and processes and reducing costs of manufacture that we bring our products within the reach of new classes of customers and so expand our markets.That sums up the situation very well indeed. This afternoon, therefore, we find ourselves discussing the fundamental basis of British prosperity, upon which is based the power and influence of Britain in the world, both now and for the future.
58 The White Paper has been very appreciatively received. It is an interesting document and well written. It gives all the information for which we have asked. We appreciate the ready acceptance of the right hon. Gentleman and his noble Friend of our request, both in another place and here, for such a White Paper to be produced. It is very valuable indeed.
The size of the investment programme is really prodigious. [Interruption.] Have I got something wrong?
§ Mr. Nabarro
I only want to remind the right hon. Gentleman that the fact that the White Paper is being discussed in the House this afternoon is a direct result of the row I had with my right hon. Friend the former Minister, who is now the Minister of Supply, in May last year for a White Paper setting out comprehensive details of this kind. It has nothing to do with the Opposition.
§ Mr. Robens
When the Minister of Power made his statement in another place he was pressed for a White Paper, and he was pressed both in March and earlier in this House for a White Paper. But it does not matter who did the most pressing. We are glad when the hon. Member for Kidderminster (Mr. Nabarro) presses with us. The fact is that we have got the White Paper and it shows how useful it is to be able to prod a Government into producing it, because we are now having a debate which we might not otherwise have had.
The interesting thing about the White Paper is to see the figures of the enormous investment programme. I wonder sometimes whether the ordinary man in the street realises what a fantastic sum of money we are talking of investing in our power industries. It is a total of £4,700 million, of which £919 million is for the nuclear power stations. Although this is an enormous programme, it is the nuclear energy programme that excites the imagination.
I join with the right hon. Gentleman, on behalf of all of us on this side, in paying our tribute to the scientists and others who work with them who have made this programme possible. It is gratifying to feel that today, at the International Fair, 59 Britain is able to offer atomic power stations for sale. That is a most creditable performance, and it certainly puts Britain on top.
The White Paper indicates that in 1965 we are to get 6,000 megawatts of electricity at a cost of £919 million. In effect, that is the coal equivalent of 18 million tons. I shall return to that later, because it is important to stress that coal equivalent of 18 million tons for an investment of £919 million.
For obvious reasons, the White Paper cannot include the oil programme, but the Paymaster-General has been good enough to supply information concerning it, and he would agree that we cannot possibly discuss Britain's power policy without relating the contribution that oil will make. Some time ago I quoted Dr. Daniel, of the Ministry of Power, in a paper which he read to the Institution of Production Engineers. At that time, I think in 1955, he took the assumption about doubling the standard of living in twenty-five years and he said that by 1975 —and I go ten years beyond the period with which the Minister has been dealing this afternoon—our fuel consumption would be to the coal equivalent of 375 million tons. The National Coal Board plans for 240 million tons by 1965 at a cost of £1,000 million, but it goes on to say that that 240 million tons can be raised to 250 million tons by 1970 at an additional cost of about £400 million.
I agree that the trend of the fuel consumption is fairly speculative, because it is based on so many assumptions which may or may not prove to be absolutely accurate, but if that trend can be assumed the gap by 1975 will be about 110 million tons to 120 million tons of coal equivalent which will have to be filled by alternative fuels. It will have to be filled by oil or nuclear energy or both. The Government issued a White Paper in February, 1955, which they called "A Programme of Nuclear Power," and they said that by 1975 nuclear power stations might total 10,000 megawatts to 15,000 megawatts, representing about 40 million tons of coal.
I ask whether there is now a change in the Government's estimate of the amount that the nuclear power stations will provide by 1975 as distinct from the estimate in the White Paper of February, 1955. It can be hardly the case that it is 60 the same. The right hon. Gentleman may remember, because some brief reference was made to it some time ago in the House, that the News Chronicle of 13th March quoted Sir John Cockroft as saying thatOnly 14 of these giant stations—modelled on Calder Hall but 10 times more powerful—would be needed to take over the whole of the country's present electricity load from coal.The right hon. Gentleman made no reference to it today, possibly because there was no opportunity to do so, but this is important. Whilst I am very glad that the right hon. Gentleman emphasised once again that the country will depend largely upon the coal industry, when there is a striking estimate of this kind that within this comparatively short time no coal will be required for any new nower stations, those engaged in the mining industry will naturally have some feelings of uneasiness, to say the least, as to whether their job will continue.
Whilst the mining industry is required to spend £1,000 million in development work, it will require large numbers of scientists and others to do that work, and the great danger is that if what Sir John Cockroft has suggested becomes true in the foreseeable future, young scientists might not go into the mining industry to carry out this programme. That would be a serious situation. It would be useful if the Minister could clear the matter up.
§ Mr. Maudling
What the position will be by 1970–75 is extremely speculative. Quite apart from what the nuclear scientists can do, one of the important things is what proportion of electricity demand will be base-load demand and to what extent we can use nuclear electricity stations for other than base-loads. There is no reason to induce the Government to have an estimate different from that made in 1955. If anything, things are less certain today than they were then, but as far as we can estimate, in the early 1970s about 40 per cent. of electricity will come from nuclear sources, leaving over 60 per cent. to come from conventional sources.
§ Mr. Robens
I am grateful to the right hon. Gentleman. That helps to clear up a growing uneasiness within the mining industry.
The right hon. Gentleman referred to the gap which would exist by about 1965. 61 He said that it would be a coal equivalent of 60 million tons and that 20 millions would come from increased coal output, 14 millions from nuclear energy and 26 millions from oil, but he indicated that that still left a further 28 million tons of oil which would have to be imported in 1965.
§ Mr. Maudling
If I may say so, there is confusion in referring to the coal equivalent and then to tons of oil. The additional 26 million tons is coal equivalent. In other words, the actual oil addition would be something over half that. The increase in oil imports would be an additional 50 per cent. over the present 28 million tons.
§ Mr. Robens
The amount would be not 26 million tons of oil, but the coal equivalent, which actually would be something less than a ratio of 1 to 1—.7.
The programme for nuclear energy indicated by the Government is wholly approved by us on this side of the Committee. We would agree with the right hon. Gentleman and the Government that the nuclear energy programme should be the greatest for which resources are available. I agree wholeheartedly with the right hon. Gentleman that it would be far better to have a surplus of power because we have planned for too much than to be short because we had failed to plan adequately.
There is another aspect of this problem. It is that human as well as physical resources will be required. When we consider this enormous programe and realise the number of highly trained technicians and others required to carry it out, we must ask whether the Government can say that in the field of technical education we are keeping up with the necessary tuition that will turn out the numbers of people we need. Although this is a matter for the Ministry of Education, I have no doubt that the Minister of Power and the Minister of State must have ascertained the views of the Minister of Education upon it. It is certainly a very important factor.
I return to the comment I made earlier, that the nuclear energy power programme, at a cost of £919 million, is to save the coal equivalent of 18 million tons. I mildly criticised the right hon. Gentleman for being a little light about coal conservation. This is one of the 62 most serious matters facing the country. The Report of the British Productivity Council made it quite clear that there was an opportunity of saving 30 million tons of coal a year in this country by the more efficient use of coal. I know that other experts have put the figure as high as 70 million, but Iet us take the British Productivity Council's figure as a reasonable one.
It means that we are throwing away the equivalent of nearly £2,000 million of capital investment by the wrong use of coal. Can we really sit here as those responsible for the nation's fuel and power policy and permit that to go on? Are we really still at the stage of encouraging people not to use coal when we would need twice the nuclear energy programme to do, what? Merely to take up what is being wasted today on the authority of the British Productivity Council in its special report on fuel conservation.
I say to the right hon. Gentleman that no fuel policy for Britain will be complete without a real and energetic attempt to save the 30 million tons of coal to which the British Productivity Council referred. I ask whoever will reply to this debate to tell us what the Government propose to do, other than what has already been done, to carry out the 44 recommendations of that Council? Are the Government really serious about the efficient use of coal? Do the Government think that it is worth while trying to save the 30 million tons, and does the right hon. Gentleman not see that this exceeds the oil equivalent which he says we shall need to import? Does not the Minister agree that even if supplies are available from the Middle East, even if tankers are available, from now on we are really allowing our lifeline to be held by people who at any time can squeeze it?
Is it, therefore, not sensible for us as a nation not to have our fuel resources held in the hands of other people over whom we have little or no control? Is it not important, therefore, that every ounce of coal we raise from the pits in this country should be used without waste, and so reduce our dependency on oil from abroad?
I shall make no reference to the health of the nation on this occasion, because we have had many debates in this House 63 about the injury to health caused by smoke. In addition, there is the enormous cost to public authorities and others of cleaning buildings, repairing ancient monuments and other places, including the Palace of Westminster. All this is caused by the smoke nuisance in this City and throughout the country.
I want to see the Government produce a really sound policy, which is bound to be a little irksome to some people who waste coal, though I should think it would be rather heartening to those industrialists and others who have spent a lot of money in improving their plant and making it as efficient as possible. Indeed, it must be very irksome to the industrialist who has spent his money and has done all he can to cut down his own inefficient use of coal to see neighbouring industries using it wastefully. I suggest that the right hon. Gentleman ought to stimulate his right hon. and noble Friend to produce a sound policy now, as a supplement to the White Paper on the investment programme, with the intention of carrying out the recommendations of the fuel conservation report of the British Productivity Council and making them a reality.
The nationalised industries were not nationalised merely to transfer their shares from private to public hands. The nationalisation programme was designed for us to use the nationalised industries as an instrument for working out a more realistic fuel and power policy for Britain. Incidentally, the nationalised industries are amongst the biggest house owners in this country, and they have under their control large quantities of fireplaces, boilers, and other coal burning appliances. The Minister has the right to give them directions in the public interest. It seems to me that, whilst direction may not be necessary, it is important that the Ministry of Fuel and Power should say clearly to all the nationalised industries that they must put their house in order and that, wherever they are using coal wastefully, this must be stopped. If we could get a real drive on the part of the nationalised industries, it would set a good example to industry generally since, as I have said, they control a vast number of houses and other places where the wasteful use of fuel is taking place day by day.
We should hear something from the Government about the steel situation. My 64 hon. Friends the Members for Loughborough (Mr. Cronin), on 4th March, and Hillsborough (Mr. G. Darling), on 11th March, asked whether we could have a statement on the availability of steel supplies for this programme. As the Minister of Power is now responsible for steel, I should have thought that today we might have had some assurance that the programme will be completed, so that we shall get all the steel required at the time it is required, so that the programme will not be held up, and so that there will not be any bottlenecks, as the result of a shortage of steel supplies, when we move into the nuclear energy programme.
We would like the Parliamentary Secretary to tell us, therefore, what is happening in the steel industry. If one thinks of the atomic power station programme, the conventional power station programme, the railway modernisation, the shipbuilding programme, including tankers, the oil refinery programme, the steel-using manufacturing industries, and civil engineering, the amount of steel needed will be prodigious, and a tremendous capital investment will be needed, also. That programme cannot be carried out unless the steel supplies are available, and unless the right qualities of steel are produced for the purposes for which we want them. It would be useful, therefore, if the Parliamentry Secretary could tell us the prospect for steel supplies.
I recommend the Minister to consider carefully once again one of the main recommendations made by the British Productivity Council for a national fuel policy. Bit by bit we are moving towards such a national policy, although no one has actually spelled it out. I believe that the recommendation of the British Porductivity Council is as valuable now as it was when it was first made. I will not read out the paragraph, but the Council suggested that a commission should be set up armed with full powers of investigation, not excluding the nationalised industries, and for a report to be published as a White Paper on the co-ordination of our fuel and power supplies.
One suggestion made was to examine the siting of both power stations and gas works, so that the waste heat from the electricity power station could be used in the processing in the gas works. When asked about that today by my right hon. 65 Friend the Member for Easington (Mr. Shinwell), the Minister said that, of course, one could only use the waste heat from the power stations if there were a place to which the waste heat could go. Well, the British Productivity Council has suggested where it could go. What the suggestion really means is that when building programmes are being carried out by the gas and power industries these should be considered together in order to accomplish two things. One purpose would be to get them as near to the coalfield as possible to save transport. The second would be to build them as close together as practicable in order that the waste heat from the electricity power station could be used elsewhere.
§ Mr. Nabarro
Would the right hon. Gentleman point out to the Committee in this context that the Anglo-American productivity team, in its report to which he is referring so copiously, published a full double-page map of Kidderminster as being the best example in the United Kingdom of the application of this principle? My right hon. Friend in the Committee on the Electricity Bill upstairs, somewhat disparagingly, I thought, said that he would not enter into any controversy with me on the economics of steam distribution in Kidderminster. I commend this report to him.
§ Mr. Robens
For obvious reasons, I would not dream of mentioning Kidderminster and ruining the speech of the hon. Gentleman who represents that constituency.
Nevertheless, I urge the Minister to give this recommendation his very earnest consideration. We have now reached the stage when it is necessary to co-ordinate the work of the fuel and power industries for which the right hon. Gentleman is responsible. The Productivity Council is quite right. If one were to set up a commission composed of technicians and others to work speedily and if the results were to be published in a White Paper we should then be moving towards the final stages of producing a sound fuel and power policy.
I will conclude by summing up our views upon the matter. I think, first, that we need a national fuel policy and that this is a task for a commission. Secondly, I think there must be a really 66 energetic drive for the more efficient use of coal. Thirdly, there should be a real endeavour to implement the recommendations of the Productivity Council. Fourthly, there should be the greatest possible development of the nuclear power stations to lessen our dependence on imported oil. Fifthly, there should be much greater emphasis upon the production of smokeless fuels in order to clean up our cities and towns.
There should also be the right kind of fuel and power policy for Britain which, thank goodness, is not a matter of party politics. It is the basis of British prosperity and of the happiness and welfare of her people. It will determine whether British influence in the world is to be great or small and whether we who are at the birth of the second industrial revolution will be regarded by future generations as wise or profligate. The Government can be assured that we on this side of the Committee shall be ready to play our part in the shaping and carrying out of such a policy.
§ 5.3 p.m.
§ Mr. John Harvey (Walthamstow, East)
I am pleased to have the opportunity of following the right hon. Gentleman the Member for Blyth (Mr. Robens), because I am certainly not out of sympathy with his suggestion that there should be a national fuel policy and that there is a real need for thinking very seriously about such a policy. The right hon. Gentleman suggested that we had moved towards a national fuel policy in recent years, yet I cannot help wondering whether, in point of fact, we are not, if anything, somewhat farther away from it now than we once were because of the quite unprecedented developments in regard to atomic energy and their impact on policies which were otherwise developing, more or less rationally, in regard to coal and oil.
We all agree, I think, that the prosperity of this country and of the British people clearly depends on our having available all the energy that industrial expansion will demand. One of the lessons which Suez, I think, has really hammered home to us is that this country could be strangled to death at Suez unless we do a great deal of clear thinking about our future oil policy.
I and many other hon. Members have been saying for years in our speeches in 67 the country that we as a nation could be strangled to death at Suez. I have no doubt that people who have listened to us have said, "Yes, that is very interesting", and have then gone home and thought no more about it until last autumn, when it became abundantly clear that exactly that could happen.
One of the things about which I am concerned today is whether we are not becoming a little too inclined to think that the atomic age is upon us and that it will solve all our difficulties, almost overnight, in the matter of providing us with our necessary energy requirements. In point of fact—and this we must face—we shall be heavily dependent on oil imports, and increasing oil imports, for many years to come. And not only we in this country but also our friends in the free countries of Europe, where the oil programme is calculated to have to expand at an even greater rate than in this country. It is estimated that in the free countries of Europe the quantity of oil imported will be quadrupled over the next twenty years.
Where is all this oil coming from? Quite clearly, we shall have to continue to rely very heavily on the Middle East for the expansion. On the other hand, equally clearly, many countries are now very much alive to the unreliability of oil supplies from the Middle East, and this is causing a great deal of heart searching and, indeed, of oil searching elsewhere. The French have recently announced some quite important finds in the Sahara which may well prove to be an immense oil field when the matter has been investigated in a little greater detail.
It is to be hoped that some of these things may, in their turn, act as a salutary warning to the countries of the Middle East that the prosperity which they can enjoy if they care to link their economies with the prosperity which we in the Western World hope to enjoy is not something that they will enjoy if they force the Western world to look elsewhere for the oil that it needs.
The question of the rate of expansion of future oil supplies is perhaps one which is not being given sufficient attention in the House, and, indeed, in the country as a whole. I wonder whether that is because it is something which falls particularly within the realm of private enter- 68 prise rather than in the realm of the nationalised undertakings. There is a grave danger of a series of separate power policies developing in the country, one for coal, another for electricity and atomic energy, and then, perhaps, one for oil, developed not in any sort of concert with each other, or in a rather remote concert if there is any concert at all.
May I illustrate the point? Until quite recently it was assumed that by 1965 we might have to import about 70 million tons of coal equivalent in terms of oil, and, by 1975, 100 million tons. It now appears that we may need only about 60 million tons of coal equivalent in terms of oil by 1965. We cannot, apparently, get any reliable figures of what will be required in 1975, because we do not know at what rate the atomic energy programme is to be developed beyond 1965. Somebody has got to know before long. Quite apart from the Atomic Energy Commission and the Central Electricity Authority, the oil industry must know, too, if it is to make the sort of investment that it should make and provide the sort of contribution that we expect from it.
Again, we are told that coal production may settle down around 240 million to 250 million tons. But it appears that a lot of the coal used for generating electric power may no longer be required. I submit to my right hon. Friend that one of the things we must bear in mind is that it is not unlikely that we may, before many years have gone by, be much more interested in exporting coal than we are today. If that is to come about, we must be very careful not to kill off the remaining export markets for that product now when we may so much need them again at a time not very far distant.
We should remember that over the last few years people who have very much wanted British coal, and who have not been able to get it, have sought other ways of meeting their requirements. It will not be just a question of us making more coal available for export if we do not watch that problem at this stage.
The Minister referred to the fact that severe damage could be done to our economy by a relatively small shortage of the type of fuel available. He went on to say that, looking further ahead, one could not really set limits to the sort of change in policy which might be 69 needed, but I would suggest to the Committee that basic policies in these sort of things cannot be changed at will. Policy in these things remains fairly static for long periods once it has been decided. Once a factory decides to go over from coal burning to oil burning it cannot be put back to coal burning easily and without considerable expense and inconvenience. Certainly, that is very true of British Railways.
Let us consider this problem for a moment. When, just before last Christmas, we found it necessary to impose petrol rationing, people were thinking of going away for Christmas and realised that they could not go by road. This was a personal experience of mine, but we found that we were, nevertheless, able to switch to British Railways and go away for Christmas just the same. However, in a few years' time, when our passenger locomotives are diesel locomotives on the long-distance journeys, it will not be so easy for motorists to go by train instead of by road.
§ Mr. Nabarro
s: I think that my hon. Friend is misleading the Committee by his wild statements that all the locomotives on the long-distance routes on British Railways will, in a few years' time, be diesel locomotives. Of course they will not. We are electrifying, for example, the whole of the main line between London, Crewe and Manchester, and every locomotive used there will be an electric locomotive using electricity generated overwhelmingly from a coal base.
§ Mr. Harvey
Yes, I accept the correction, but, at any rate, my hon. Friend has served to illustrate the point I was trying to make, that we are now definitely leaving the days of the steam locomotive behind and are switching either to diesel locomotives or to electric locomotives.
Therefore, we need to ask ourselves—and now, perhaps, I shall take my hon. Friend with me—how far we are to go along the lines of electric locomotion rather than diesel locomotion—
§ Mr. Harvey
—because with electric locomotion it does not matter how electricity is provided for it can come from coal power stations, or it can come from oil power stations, or it can come from atomic power stations, and still the 70 same method of propulsion, the same method of getting from one place to another, can be used.
All these things have to be thought out a very long time ahead indeed, and we have to ask ourselves, if we are definitely to abandon the use of coal over a wide range of our economic activity, what sort of repercussions that will have upon our demand for oil and our demand for electricity. While coal has been adequately thought of this afternoon and electricity has been thought of, I am not so sure there has been that frankness that perhaps there ought to have been on the subject of oil, and, personally, I should like to have a little more from my right hon. Friend as to plans for seeing that, for instance, Suez cannot happen again —that we cannot be held to ransom by a lack of oil.
There is a need to think very seriously about national oil policy as distinct from oil policies formulated by the big companies. I mean, for instance, that it need not be impossible for the Government to consider laying down in this country emergency stocks of crude oil that would be used in an emergency. I should like to see an inquiry into the possibility of using disused mine workings and quarries for this sort of purpose. After all, let us remember that that is the way in which oil is stored in the bowels of the earth, in certain geological formations; and according to many experts there are many such geological formations in this country which could be used for natural storage. The oil companies cannot be expected themselves to finance such a programme, even if it is feasible. We ought to consider what should be done about it and how much can be done.
Other than that, I wonder whether we should not contemplate a much greater use of pipelines in this country, such as those developed extensively in America and more recently on the Continent of Europe. It should be recognised that the development of pipelines does not mean miles of unsightly pipelines overland, such as one is used to seeing in pictures of Middle Eastern developments. In the United States there are underground pipelines carrying oil thousands of miles from the oil producing areas to the oil using areas.
Let us remember, also, that another type of pipeline has been used in America 71 recently with success for carrying fuel oil which, in turn, has been enriched with pulverised coal. Is there a lesson to be learned from that in the use of the small coal which, we are told, the Central Electricity Authority is not likely to require any more after the next few years? Is it possible for that coal to be pulverised and used to provide enriched fuel for certain of the big industrial concentrations in this country? Those are all problems which ought to be thought out alongside our thinking about coal developments and the development of atomic energy.
I do not want to detain the Committee too long, because I know many hon. Members are anxious to take part in the discussion, but I want to revert to the theme with which I began and which I picked up from the right hon. Gentleman the Member for Blyth, and that is the need for an impartial inquiry into the whole question of our future power programme. This is now too big a thing —it has always been a big thing, it certainly is now too big a thing—to be developed along a series of parallel, quite separate lines, with a coal programme and an electricity programme—both along conventional lines and with an atomic programme alongside them.
That brings me to a letter I received only yesterday from a very good friend of mine, who wrote:In the nature of things, power stations and gas works in big industrial areas should be integrated units. It is economically crazy"—and this is the point—to heat power stations with fuel oil which has been processed from crude oil in a complicated, modern, high capital-cost refinery. If the power stations are not prepared to work on straight crude oils—and there is no reason why they should not—they should have their own simple distillation units producing two fractions, one a long residue which would be burnt at the power station, and the other the light ends which would go to the gas works.… Power stations would also be the natural producers for certain chemicals, such as sulphuric acid, chlorine. acetylene …I agree with all that. There is a lot of waste, quite apart from the sort of waste we have talked about today, the waste of energy itself; there is waste by lack of integration. These are not the sorts of things which the oil companies and the authorities, all working along separate lines, are likely to get together about with 72 a view to hammering out the sort of national policy which we need, but some such policy must be hammered out, and I suggest that, in the interests of the country and of a future which surely can be a worthwhile future for us all, it is necessary now—and quickly—to have an inquiry into the development of a real policy which will give us power with maximum efficiency.
I should not like to think we are being panicked into an undue investment at this stage in nuclear energy, just because of what happened at Suez. I am not suggesting that that is what has happened, although it is just possible that it is what has happened. There is, however, need for a considered, detailed inquiry by people who know what they are inquiring into and who can make recommendations on behalf of all sections of British industry and the British people for the future prosperity of our country, and which will stand the test of time.
§ 5.20 p.m.
§ Mr. John Taylor (West Lothian)
The hon. Member for Walthamstow, East (Mr. J. Harvey), in the course of a very interesting and knowledgeable speech, suggested that there was a need for a national oil policy. The idea, although not entirely new, is very attractive at the moment. The Government and hon. Members opposite who are interested in oil production should give it serious consideration. The bulk of the hon. Member's speech was devoted to oil. When I looked around the personnel of the Committee at the beginning of the debate I thought that there was an even balance of Members to speak on coal, on electricity, and on oil, but as I also want to speak about oil it seems that there is a predominance of Members to speak on this subject.
I want to speak about indigenous oils. There is and always has been a tendency to pooh-pooh our indigenous power resources. It seems that they are so comparatively small that they are scarcely worth the bother; but we do not know, because we have never thoroughly prospected our indigenous oil resources, the extent of those resources. Rather the same view was taken in Germany for a time, but indigenous oil supplies now provide Western Germany with 30 per cent. of her total oil consumption.
73 I shall not claim that that would be the result of an extended survey in this country, but I shall say that we have a small but extremely valuable source of indigenous oil supply. It is being not only neglected but threatened and, indeed, condemned by Government policy. The right hon. Gentleman made a special point of the fact that it is Government policy to encourage and develop our indigenous fuel supplies, including oil. I do not believe that he would make such a statement unless it had been carefully considered by the Government, and certainly by his noble Friend the Minister of Power.
What are our indigenous oil supplies? There are a few borings producing a few thousand gallons a month in Nottingham-shire, near Newark. There are a few others in the South of England, and there are by-products from the National Coal Board, the gas industry and certain sections of the chemical industry. All those together do not amount to the production of our main source of indigenous oil. The Committee will not be surprised when I say that that is the shale oil industry. Production of shale oil, in comparison with our annual consumption of oil, is extremely small. That is frankly admitted. It may be 50 per cent. more than it is if it is developed.
At the moment, it is slightly less than 20 million gallons per annum, roughly 1 million tons. That is like a drop in the bucket in comparison with our annual requirements, but it is British oil. It is produced without the expense of tankers and pipelines, and it is a very valuable contribution to our oil supplies. It is produced by the industry which was the world pioneer of oil production and which certainly pioneered shale oil production. It is produced by a process which other countries are now developing. The United States is developing production of oil from shale and is subsidising it to the extent of 35 million dollars this year by special vote. It is being developed in China, Manchuria, Russia, Spain, France, Germany and many other countries.
The methods by which it is being exploited are the methods pioneered and still used in the shale oil industry in my constituency. Although the 1 million tons per year is a fairly valuable contribution and our gap would be that much wider if it were not produced, the astonishing 74 thing is that the industry is being strangled. It is apparently under sentence of death and the 20 million gallons per annum is due to be lost to our total oil resources in this country. Four-fifths of the production is for dery and diesel oil, and the other fifth is for motor spirit and naphtha.
§ Mr. Taylor
I was talking about two different conceptions of production. One is the Exciseable amount, the amount which pays Excise duty, the other is total production, some of which goes in by-products.
The industry is condemned because it is producing at a loss. Nowhere in the world as yet is shale oil produced at a price which is comparable with the cost of production from oil wells. Shale oil is everywhere being produced at a higher cost of production than oil from oil wells in the Middle East, in America or elsewhere, even though that oil has to bear the cost of expensive tankers and pipelines, probably canal dues, certainly dues to the Rulers and Governments of the producing States.
In spite of that heavy overhead cost of well-produced oil, shale oil is still more expensive to produce. Of course, it cannot be sold in this country at any except the prevailing rate and the prevailing rate for motor spirit or derv is that fixed by the oil producing companies. It is impossible for the shale oil industry to charge for its product a figure higher than the market rate for either motor spirit or derv.
It would not be making a loss were it not for the fact that it contributes nearly £1 million a year to the Revenue. I know that this is a matter not for the Paymaster-General's Department but for the Chancellor of the Exchequer, and we shall certainly raise it in our debates on the Finance Bill. I mention it as a factor which should be borne in mind in the context of this debate. Although there is an urgent necessity to encourage every indigenous source of fuel and power, and although this is a small but extremely valuable source of high quality oil and spirit, it is endangered because it has to contribute nearly £1 million in Excise duty. If the industry were excused payment of this sum, and if the 75 Excise duty on indigenous oil, in general, and shale oil, in particular, were abolished, the industry would be able not only to clear its way financially but also to set aside a sum for development.
In my constituency and the neighbouring one of Midlothian, between the Firth of Forth and the Pentland Hills, sufficient resources are available to enable the industry, if it had enough capital to invest in the sinking of new shafts and the exploiting of new seams of shale, to increase its production by 50 per cent. and carry on at that increased rate for another twenty years.
The astounding fact is that the industry will shortly have to close down unless it receives this relief. If it does not there will then be the still more astounding spectacle of the Exchequer losing not only its £1 million a year in taxation, but also the ordinary and normal taxation which comes from every industry through the various Inland Revenue schedules; the loss of at least 20 million gallons of oil per annum, and 3,000 workers without jobs, in a district which has no alternative employment.
It seems such a stupid state of affairs that I make no apology for mentioning it in detail this afternoon. We shall return to it, in its financial aspect, when we discuss the Finance Bill, and I hope and believe that there will then be united support from hon. Members on both sides of the House for an attempt to prevent the murder of this world pioneering industry. I am glad to see that one of the Joint Under-Secretaries of State for Scotland is in his place and is making notes about this circumstance.
In this business of fuel production the Government might consider the fact that coal was the chief fuel of the first Industrial Revolution, and that atomic energy and electricity are obviously the fuels of the second one. In many parts of the country, however, the fuel of the first Industrial Revolution is running out. In some districts coal mines are becoming exhausted, and although it is very easy to talk about moving populations and transferring miners to new and developing coalfields, we know from our experience that this is a very human problem and that a considerable proportion of miners affected by the closing down of worn-out and uneconomic pits do not move to the 76 new and developing areas. Their roots are too deeply embedded in the places where they were born, where their children are being educated, and where their families are finding other work. They do not move, and this is a potential danger.
In my constituency there is the dual problem of the threatened collapse of the oil-producing industry and the coincidental exhaustion of old coal mines. According to the National Coal Board, in ten or fifteen years most of the coal mines now operating in East and Central Scotland will have practically ceased to produce coal. This means that thousands of miners will have to find employment in other coalfields or leave the industry altogether and try to find employment in others.
In the development of their fuel policy the Government should endeavour to site new atomic and electrical power stations as far as possible in those areas in which the chief industry has become exhausted, or the resources of the old source of power have become denuded. I know that that is not always a practical proposition. In its present state of development an atomic energy station requires very large quantities of water, and many areas of under-employment are without large water supplies. I also know that it is often necessary to site new power stations near developing coal pits and not ones that are becoming exhausted. But there are places where suitable and extensive sites are available; where the land is cheap and no amenities will be spoiled, because they were spoiled by the first Industrial Revolution. As a matter of social as well as economic importance the industries of the new age should be sited wherever possible upon the ruins of the old, because that would enable us to find employment for a very valuable section of our community.
In other respects the speech of the right hon. Gentleman was a very valuable lecture. It was a lecture. It is the kind of subject in which the right hon. Gentleman excels. His speech was non-partisan; it enabled us to look to the future and see the general shape of fuel and power policy; it opened up some attractive possibilities and caused us a few misgivings. It was delivered attractively, imaginatively, eloquently and forcibly. It showed that the Government have given 77 a considerable amount of thought to this important and urgent problem, upon which the future of the whole nation depends. Although it might be niggled at in detail I am glad to welcome the general trend of thought behind it.
In devoting so much time to one small section of the fuel industry—and this, after all, is a matter of life and death for so many of my constituents, and is of no small importance to my native country and its economy—I hope that I have not detracted from the importance of the general policy which we are considering.
§ 5.38 p.m.
§ Mr. Richard Fort (Clitheroe)
We must be grateful to the hon. Member for West Lothian (Mr. J. Taylor) for introducing a human note into a debate which, as he said, started with a lecture—although I should prefer to use the word "review"—concerning the great power problems before us. Running through much of his speech, especially the earlier part of it, when he was discussing the West Lothian shale oil field, was what is really the fundamental problem of the future, namely, how best to use the capital which is demanded, as shown in the White Paper of last April, and as the right hon. Member for Blyth (Mr. Robens) emphasised so strongly.
The White Paper sets out an enormous programme, and we ought to be concerning ourselves with the question of what is involved in the use of the large sums of capital needed to carry it through. After the skill and knowledge of our fellow countrymen, capital which are our savings is the most valuable commodity that we have, and also a scarce one.
I was worried because it seemed that my right hon. Friend was suggesting that his technical advisers were considering problems which I should have thought at best were likely to come off only with luck, and more likely to involve us in large expenditure with no possibility of great profit to the country. Particularly, in my opinion, is that true from the point of view of the efficient use of capital.
Referring to the research and development work of the Government's scientific service, my right hon. Friend mentioned the process for converting coal into oil. Scientists and technologists all over the world have been working on this problem for a long time. It can be done. 78 The fact that the proposed processes would be extremely expensive is a good reason why they have been developed only very cautiously. A large amount of capital would be required to provide energy in the form of oil in that manner, and I should have thought there were alternative and more promising schemes to which capital might be devoted more profitably. In fairness, I should say that my right hon. Friend mentioned one of these alternatives, namely, the complete gasification of coal. That process has been used on the Continent for a good many years, but, for reasons which I have never understood, the gas industry in this country has been reluctant to adopt it.
The speech of my right hon. Friend and other speeches dealing with the technical problems involved in this power programme, reminded me of the extraordinary difficulty confronting the Ministries when providing recommendations for our discussions. We are today having to discuss some of the most complicated technical and economic problems which could confront any group of people. I pity the unhappy Ministers who have the responsibility of publishing White Papers and trying to explain these matters to hon. Members—who have even less expert assistance to aid them in their understanding—so that they, in turn, can enlighten their constituents and convince them of the need to furnish such very large sums of money. The problem of presenting technical advice to Ministries and to Parliament is revealed in a dramatic form when we discuss the complicated subject of Britain's power programme. I cannot remember any other debate since I have been a Member of this House in which the difficulty was so apparent.
My right hon. Friend put in a complete, but not a novel form the conclusions which most of us who have been trying to follow this matter have arrived at with the assistance of the information contained in the White Paper and the discussions to which we have listened both inside this House and elsewhere. First, we must ask ourselves what are likely to be the energy demands for the next ten or twenty years. I have never doubted that the estimates made by the Ministry and others are right; that it is unlikely that we shall depart very much from what has been happening during the last twenty 79 or thirty years which so closely parallels the increasing rate of energy consumption in other countries. Indeed, consumption in this country has been increasing at a smaller rate than in the United States, and so we must look forward to an ever increasing demand.
We all share the feeling expressed by my right hon. Friend about the difficulty of greatly increasing our coal production to help to meet the increased demand for energy. In view of our geological difficulties we shall find it hard to keep pace with that increased demand over the next ten or twenty years. The oil situation is clearly limited and circumscribed by political considerations.
Finally, we come to the nuclear energy programme. I know that some of my right hon. and hon. Friends, particularly the noble Lord the Member for Dorset, South (Viscount Hinchingbrooke), have been critical about the Government proposals. They argue that, as time goes on, it will be possible to have smaller power stations instead of the large stations at present proposed. I doubt whether that argument carries much weight. I think that the programme published earlier this year and the financial implications discussed in the White Paper represent the minimum which any Government could consider, in view of the demands for energy which will become apparent in the next ten or twenty years and the recent developments in the application of nuclear energy.
§ Mr. Palmer
When referring to the size of nuclear power stations, the hon. Gentleman will not overlook that the proposed station on the Fife coast to be erected by the South of Scotland Electricity Board is likely to be a very large one compared with any conventional power station.
§ Mr. Fort
I agree with the hon. Gentleman. I was saying that some of my hon. Friends wonder whether smaller stations might be produced, so that we shall not have huge buildings which they fear will destroy the amenities in many attractive parts of our coast.
I am surprised that hon. Members opposite did not criticise vigorously what I consider the most interesting part of my right hon. Friend's speech, when he discussed the method by which the importance of the different parts of the 80 power programme can best be ascertained. My right hon. Friend came down firmly in favour of electricity, gas, coal and nuclear energy competing with each other within the general framework of the overall programme set out in the White Paper. I am sure he is right. I do not think there is any group of people, even the best-brained economists and technicians, who can work out today the right relation between these industries, not only in ten years but today. The only satisfactory way of getting that right relationship is to allow them to compete on a sensible price-basis.
When I was thinking about this matter I was struck by the fact that an analogous problem had been solved by competition on a price basis during the last ten years. Nobody could have foretold ten years ago the present enormous demand for the fuels which are used in jet engines, the so-called "kerosenes", which have entirely altered refinery practice. These fuels have replaced the aviation spirit which looked likely ten years ago to hold their field for a very long time. Striking the balance between aviation spirit, gasoline and kerosene has been possible only because of free competition in the use of those fuels.
A point I got from my right hon. Friend's speech was the need for flexibility. None of us can foresee the developments in the next ten years. We might possibly be able to move natural gas by refrigerating it and putting it in tankers, as petroleum is today, or large enough natural gas fields may be found in Europe to justify laying gas pipelines. These might be much cheaper ways of bringing energy to this country than importing uranium ore and processing it until it finally goes into a nuclear power station. I was delighted to hear the Government's firm view that these matters can best be worked out by competition rather than by any rigid determination of plan at the present time.
§ 5.53 p.m.
§ Mr. Albert Roberts (Normanton)
We are discussing a very important subject which does not always demand the same attention as an international crisis. We all depend upon power; the lifeblood of the nation comes from energy. Our fuel needs are wrapped up in coal, nuclear energy and oil.
81 Our coal seams are limited. As I have been connected with the mining industry, I will, naturally, have more to say about coal, its extraction and conservation. The Paymaster-General said that he was aware of our concern about the conservation of coal. That point was also mentioned by my right hon. Friend the Member for Blyth (Mr. Robens). We have not had a firm policy on coal conservation, which should be one of the most important aspects of our debate. To save 1 million tons of coal is probably more important than winning 1 million tons.
George Stephenson said more than a hundred years ago that the Lord Chancellor, who then, as now, sat on a bag of wool, should be sitting on a bag of coal. That is as true today as it was then. We cannot over-emphasise the need for conservation. A great waste of coal has gone on for more than eighty years. The words said in 1875 concerning the great waste of fuel will need to be said again in another five or six years, unless the Government take positive action. I would quote from a pamphlet, written by the late Sir Hubert Houldsworth, who said:It should be accepted at once and acted upon, that it is a national duty to prevent any waste of coal. The National Coal Board has a national duty to win the coal required. The user of coal has an equal national duty not to waste it. Just as the National Coal Board must plan and work for increased capacity and output, so must the industrial user plan and work to secure full efficiency and economy in the use of coal.We are not doing enough in that direction. We have thousands of stokers—
§ Mr. Roberts
It is possible for stokers to waste millions of tons of coal or to save them. More could be done in the direction of giving additional remuneration to stokers who are fully qualified and are interested in their work. These things may not appear glamorous, but they are very important; a national policy for stoking should be put in hand.
§ Mr. Nabarro
The hon. Gentleman may have listened to a speech I made on this subject four years ago, and he perhaps recalls that the people who most strongly opposed the training of industrial boilermen and a certification of minimum standards were the T.U.C.
§ Mr. Roberts
That may be so, but nothing will prevent me from voicing my opinion in this Committee.
§ Mr. Ede (South Shields)
Not even an interruption by the hon. Member for Kidderminster (Mr. Nabarro).
§ Mr. Roberts
We have proof of what can be done with efficiency; the coal-fired generating stations are burning coal of far inferior quality to that which they burned ten or fifteen years ago. An improvement of 1 per cent. in thermal efficiency equals a saving of 1½ million tons of coal. In the last few years thermal efficiency has moved 4 or 5 per cent. I believe that in the new coal-firing stations which are being put up today the thermal efficiency is 31 per cent. or 32 per cent.
The National Coal Board is conscious of many needs. The programme to spend £1,000 million in the next ten years may seem to require a lot of money, but only £550 million is to be spent in mining activity. The noble Lord the Minister of Power said in Sheffield a few days ago that within the next few years two-thirds of our coal output will come from within a very few miles—thirty or forty miles—radius of Sheffield. The demand for coal may be unlimited, but the industry should be allowed to settle down. I do not for a moment expect the output of coal to increase tremendously, but if we could increase the manpower in the industry the answer might be very different.
The mining industry will have to play just as important a part in forty years time as at present. There are no foreseeable limits to the uses of electricity. Almost double the amount is being used today as when the industry was first nationalised. The demand for the commodity is insatiable, and we do not know where it will end. The next twenty years may see the electrification of all our main railway lines. The demand for domestic purposes will go on increasing and, at the same time, the application of the Clean Air Act will no doubt help to stimulate the use of electricity.
The Paymaster-General failed to take cognisance of a very important point when he was referring to 1965, when there might be a levelling out of coal demand by the electricity industry. I understand that we are to build coal-firing generating stations until 1970. They have an estimated life of twenty-five to thirty years. 83 That would bring us to the year 2000. Certain stations will be going out of operation in 1965. I should like the right hon. Gentleman to tell us if he is contemplating any conversion of the old stations into nuclear energy stations, because whilst the installations have a life of twenty-five years, the buildings themselves will have a life of fifty to sixty years.
It is estimated— I can only take the figures given by the Paymaster-General— that the output of electricity from nuclear power stations will have reached about 25 per cent. by that time. I believe he said that by 1975 the output would be 40 per cent. We have to realise that that is only about 15 per cent. of our energy requirements. We should not let any mistaken idea prevail in the country that when we get nuclear power stations we shall be at the end of our difficulties. If output of coal goes up by 10 million, 15 million or 20 million tons, the demand at that time will be more than the output can meet.
Like many hon. Members, I should like to see more of our coal exported. At present, I believe we are exporting 7 million to 10 million tons of low-grade fuel. I think the Paymaster-General will agree that on the Continent there is better coal utilisation than we have. That is a sorry position for this country to be in. I should like to see exports developed in order to assist the balance of payments position. I realise that importation of oil makes a great financial strain on the country, and the more fuel and power we can obtain from our own resources the better it will be for us.
We must all intensify the drive for energy if we intend to improve our standard of living. If we want to survive as a major industrial Power we must have energy. The Government must take note that our share of total world trade has fallen from 15 per cent, to 11 per cent., while the U.S.A. figures show an increase from 13 to 16 per cent. With some apprehension I also take note of the fact that steel output of this country has been surpassed by Germany and the number of ships built in this country has been surpassed by Japan. With this constant demand for energy and the growing demand from industry, we cannot maintain a high standard of living comparable 84 with other parts of the world. I know this is not as political a matter as it used to be and we must all be interested in the subject. I hope and trust that it will be possible to galvanise ourselves into action and not to allow ourselves to fall into inertia. Otherwise, I am afraid that the future for this country will deteriorate considerably.
We must all appreciate that the times in which we live are very competitive. I want to see industrial peace. I want to see an improvement in industrial relations between employers and employees. More confidence must be placed in the men's leaders. Let them realise that they are playing a part and have got to play a part if they want to take advantage of what the world can offer. I hope and trust that the Paymaster-General will try to develop the conservation of fuel, flexibility of thought and the confession that we can all help in this matter, whether we are members of the Government or of the Opposition. A bloodless revolution took place between 1945 and 1951. To a large extent a redistribution of wealth took place. It may well be that we shall have another bloodless revolution to help us to attain a position in the vanguard of progress.
§ 6.9 p.m.
§ Mr. Gerald Nabarro (Kidderminster)
A very satisfactory feature of the speech of my right hon. Friend the Paymaster-General was that over a period of 53 minutes he spoke without reference to notes. As the speech was packed with economic facts and figures of every description, I felt that that, in itself, was a substantial parliamentary achievement. I am "fed up" with seeing Ministers standing at the Dispatch Box reading speeches prepared for them in their Ministries. This performance was in refreshing contradistinction to the habits of my right hon. Friends in that important respect.
There is no doubt that over the years since 1945 we have speculated a great deal in this House— those informed on fuel and power matters in the country have done likewise— as to the possible course of supply and demand for fuel in its various forms forward to the 1960s. The right hon. Member for Derby, South (Mr. P. Noel-Baker) as long ago as 1950, was so exercised by this problem of the growing 85 gap between supply and demand that he established the Ridley Committee. The Report of that Committee was disappointing. I think it was regarded as disappointing by right hon. and hon. Members in all parts of the House as well as by many outside the House concerned with the fuel and power industries.
When the Ridley Committee was established— and I say this particularly in reference to what the right hon. Member for Blyth (Mr. Robens) said about a national fuel and power policy— it was hoped that its recommendations would form the basis for the evolution of a national fuel and power policy. In fact, the Report of the Committee was so tepid, and hedged with so many qualifications of every kind and description, that it became valueless, other than as an encyclopaedia for reference purposes in fuel and power matters.
I mention that because, again this afternoon, there has been an insistent demand for further inquiries into fuel and power resources. There has also been the demand by the right hon. Member for Blyth for a national fuel and power policy. All I reply to him is this: with the major industries in public ownership, namely, coal, gas and electricity, a national fuel and power policy is not possible unless Ministerial powers of direction as to the use and consumption of fuel are employed.
An overall fuel and power policy could not succeed unless there were Ministerial directions. It cannot be done only by manipulation of prices, which some economists and theorists seem to think is possible. My right hon. Friends in Conservative Governments since 1951 have always taken the view that there should not be Ministerial direction as applied to the detailed and price policies of nationalised industries, and if they continue to take that view then, in my view, there cannot be a national fuel and power policy.
It has its merits and its demerits, of course, but what is inescapable— and, think, accepted in all parts of the Committee today— is the fact that during the next decade if industrial production continues to increase on approximately the scale and at the average annual rate which we have witnessed since 1945, there must be a continuing shortage of all forms of fuel and power and negligible tonnages of 86 coal for export, however desirable politically it may be that we should export coal. I will deal with that matter in a few moments, for I am not by any means in agreement with my right hon. Friend's conclusions in that important regard.
As my right hon. Friend said, our total energy need today is of the order of 250 million tons of coal or coal equivalent. I calculate— and I think that my sources of information from fuel technologists outside the House of Commons are at least as good as those in Ministerial circles— that in eight years' time the total energy demand will be about 303 million tons a year; in other words, it will have increased by about 53 million tons over a period of approximately eight or nine years. The rate of increase I calculate to be about 6 million tons per annum.
Today, out of the 250 million tons of coal and coal equivalent which we are employing for inland purposes in this country no less than 88 per cent., or 220 million tons, comes directly from coal. In 1965, if the efforts of the National Coal Board are brought to full fruition and if the aspirations set out in White Paper Cmnd. 132 as to coal production are achieved, we shall reach an increase in coal production amounting only to 20 million tons per annum. In other words, we shall have 240 million tons of coal per annum from 1965 forward as compared with 220 million tons today.
If the total energy need in 1965 is about 303 million tons and the optimum coal production we can anticipate at 240 million tons is achieved, it follows that no less than 79 per cent. of this nation's energy needs as far ahead as 1965 will still be wholly dependent upon coal; 88 per cent. today and 79 per cent. in 1965. I think that that is the answer to the hon. Member for Normanton (Mr. A. Roberts), for as I assessed the implications of what he was putting to the Committee he feared that there might be a certain measure of unemployment or unfilled capacity within the coal mining industry at the end of the programme which we are envisaging today.
I reply to him that if, in 1965, 79 per cent. of the nation's energy needs are still to come from coal, then there can be, eight years ahead, no fear of that; and even if the percentage of total energy need derived from the use of coal declines year by year, then surely, as 87 time goes on, we shall begin to use coal for the purpose that nature and science deemed it most efficient to use that precious mineral—namely, as the source of manifold chemicals.
We burn coal today, even in the large power stations, at an average efficiency of only 24 per cent. and we waste 76 per cent of it. If that coal were used for carbonisation and for associated chemical processes, making admirable use of all the by-products, then we should begin to reach efficiencies three or four times as great as the efficiencies with which we use coal, still dirt cheap in the eyes of many people, in industry and in our homes today.
§ Mr. Roy Mason (Barnsley)
The Minister did not say whether these points had been taken into account in assessing his figures of coal production over the next ten years and I wonder whether the hon. Member for Kidderminster (Mr. Nabarro) has taken them into account. The National Union of Mineworkers hopes that well within the next decade the seven-hour shift will have been introduced, that there will be an extra week's holiday with pay and, thirdly, that Saturday working will have ended. To what extent, too, has the hon. Member taken into account the ending of opencast mining?
§ Mr. Nabarro
I have taken all those factors into account and I have judged them against the background of intensified mechanisation in the pits. I, too, desire to see the end of Saturday working. I desire to see the end of opencast working in certain areas. But I cannot do more than quote from Cmd. 132, which makes it perfectly clear that we may expect an increase in coal production of approximately the magnitude I suggested. The White Paper used these words—
§ Mr. Nabarro
Paragraph 4, in page 4:Because it takes several years to complete a major pit reconstruction or a new pit sinking, the plan anticipates that although rather more than half of the colliery investment will be made in the first half of the period, the increase in annual output by 1960 will be only 8 million tons compared with the expected increase of 12 million tons in the following five years.88 Those figures are, of course, on a per annum basis.
The point to which I am leading is this: 88 per cent. of our energy needs today come from coal and in 1965 the figure will be 79 per cent. Nuclear power, by 1965, in spite of this huge investment, can furnish only 6 per cent. of our energy needs, and the remainder has to be shouldered by oil. In the long term I do not think that there will he any grave difficulty in furnishing the oil needs of the size which have been envisaged today.
I intervened in my right hon. Friend's speech because I disagree with his interpretation of the oil companies' figures. These figures must, of course, be drawn from the oil companies' sources. The oil companies advise me—and I hope that my right hon. Friend has had the same information but has used it in a different way—that today we are importing 26 million tons of oil which is used for energy purposes. He may say that in terms of coal equivalent that has to be adjusted according to a ratio of 1 to 1.1 or 1.2, or more.
§ Mr. Nabarro
Or even 1.7. That is not universal by any means. It depends on what the oil is used for.
§ Mr. Nabarro
I do not even accept that it is the average. What I believe is beyond doubt at present is that we are importing today 26 million tons of oil for energy purposes. The oil companies say that in 1965 we must bring in 40 million tons of oil for energy purposes. That is an increase of about 14 million tons of oil for energy purposes over the period of the next eight years. Related to total energy needs, that represents 10 per cent. oil for energy purposes of our total energy needs today, and in 1965 it rises to only 13 per cent.
My conclusion is that overwhelmingly we shall depend for all the foreseeable future, which, to me, is only eight years — I cannot judge these fuel and power needs after 1965— we must depend overwhelmingly upon coal.
§ Mr. Maudling
I do not want any danger of misunderstanding to arise. My hon. Friend may think that the advice 89 which he has received from the oil companies is different from that which I have received but, quite clearly, what he has said coincides with what I said— that the importation of oil will be increased by 50 per cent. between now and 1965.
§ Mr. Nabarro
I will give my right hon. Friend a graph prepared by the oil companies. I am sure that he will profit by studying it.
I will pass now to the comments made by my right hon. Friend on coal exports. He sought to justify a system whereby we import coal, particularly large coal, into this country so that we may export coal from this country.
§ Mr. Nabarro
Yes, to export small coal. It is a matter of degree. What my right hon. Friend is seeking to justify is the importation of certain types of coal to export certain other types. In fact, in the year before last, we brought 12 million tons of coal into this country so that we could export 12 million tons of coal. Last year, we brought in approximately 6 million tons of coal to export approximately 6 million tons of coal. Did my right hon. Friend say, "Nonsense "?
§ Mr. Maudling
We do not import coal in order to export an equivalent amount of coal. We import large coal because we need it and we cannot get enough from home production.
§ Mr. Nabarro
My right hon. Friend is neglecting the fact that in certain circumstances we are bringing oil into this country for energy purposes. What he neglected to observe in his speech this afternoon was that, while it might be sound economics in certain circumstances to bring in coal of one type or grade in order to export coal of another type or grade, it is thoroughly unsound economics to bring in oil to use for energy purposes and to promote, wholly or in part, the export of coal.
My right hon. Friend shakes his head. I am sorry that he cannot agree with me on this important matter. He signifies that he disagrees with me. The fact of the matter is, of course, that it is a thoroughly wasteful process to bring oil into this country for energy purposes as a substitute for indigenous coal. It must prove so. I cannot think that my right 90 hon. Friend and the hon. Gentleman the Member for Normanton, who spoke earlier, are so anxious to increase coal exports from this country, if it means that to do so we have to bring oil from the other side of the world to underpin that export of coal. That seems to me to be a thoroughly bad policy. My right hon. Friend is still shaking his head, but that is exactly what we are doing. We are bringing in fuel oil in order to export coal.
§ Mr. Maudling
If my hon. Friend will study the comparative price levels it may well be that, on balance, there is a gain to the balance of payments to import oil at one price and export coal at the price we can obtain for it now. That is a calculation that is often made, though it may be that it is not always the case.
§ Mr. Nabarro
I do not accept that that very often takes place. I do not accept that it is good economics or good business either, especially having regard to the very great difficulty of securing adequate oil in the present turbulent state of political affairs in the Middle Eastern countries, which are our main sources of supply of sterling oil. If my right hon. Friend wishes to continue to rely on fringe supplies of American dollar oil to promote exports of coal from this country, which, for the most part, earn soft currency, and not hard currency, I would quarrel at once with his economic conclusion.
§ Mr. A. Roberts
Does the hon. Member agree that there is a scarcity of large coal in this country and possibly a surplus of inferior coal that cannot be burnt here owing to methods of utilisation, and that that is the reason why it is being exported?
§ Mr. Nabarro
I will deal with the intervention of the hon. Member when I come to that part of my speech which deals with fuel efficiency. The plain fact is that no coal mined in this country is bad coal. The lowest quality of coal, with the highest possible ash content, may be usefully employed under specially designed types of boilers in power stations.
I want to say a few words about the scale of investment envisaged in this White Paper. It may be in a slightly different form to that put to the Committee by my right hon. Friend, and though 91 we may disagree slightly upon interpretation of the figures the fact remains that the scale of investment is very large indeed, far bigger than anything that we have envisaged in this field in recent years. For example, I calculate that the 1957 investment in conventional forms of fuel and power production is at the rate of approximately £450 million, and that excludes the oil companies, because they are not referred to in the White Paper figures. At the present rate of growth, it will reach £500 million at today's prices within three years from now; to that rate of £500 million per annum is to be added the figure of approximately £100 million per annum for atomic power facilities and the provision of the necessary fuel resources at the outset. That gives a figure at today's prices of about £600 million per annum.
I want to ask my right hon. Friend about what I thought was a significant omission from his speech today and from all his earlier speeches. To what extent is this vast expenditure to be recouped from the resources of the industries themselves, either through their depreciation funds and accumulated surpluses, or, alternatively, by resort to borrowing on the open money market? We had a long and heated controversy on the occasion of the Coal Industry Bill last year as to the amount of money for the coal industry that was to be obtained from internal resources by depreciation and associated methods, or, alternatively, by resort to the money market.
In the case of these other fuel and power industries, we have had no guidance from the Government at all. We just do not know, for instance, what is the policy of the electricity industry in regard to the huge sums of money for which it is to ask for investment purposes. We do not know whether, largely, it will obtain that money by increasing prices, enlarging the annual surpluses, increasing rates of depreciation on its very expensive plant and equipment, and using that surplus for the promotion of future investment programmes, or whether the money is to be obtained by further borrowing on the open market. I think that my right hon. Friend ought to consider a statement in connection with each of the nationalised fuel and power industries as to how these programmes are to be 92 financed during the next few years. For example, I wrote down his exact words when he used them, and I think that he was really injudicious to use them. My right hon. Friend said that he hoped for a reduced cost of electricity per unit—
§ Mr. Maudling
I think that that was the passage in which I referred to the cost of energy produced by nuclear power, as stated by Sir Christopher Hinton.
§ Mr. Nabarro
I was very pleased to hear my right hon. Friend suggest that the cost of energy produced by any of the nationalised industries will ever come down. I do not think that he can have seen the newspapers this morning, and noticed the prominence given to the proposals of the London Electricity Board to put up its prices by 2s. in the £— 10 per cent.— from 1st June, 1957.
§ Mr. Nabarro
The hon. Member says it is outrageous. I quite agree with him. It is outrageous.
What is my right hon. Friend doing about this kind of thing? I am not quoting this example this afternoon, in isolalation; it happens to be a convenient moment to mention it. Why has the London Electricity Board put up its prices by 10 per cent.? To what extent is that big increase in price intended to cover operating costs, and to what extent is it an effort to create a surplus to provide for future investment programmes? I want to know that sort of thing from my right hon. Friend.
It is valueless, in my opinion, for him to say in this Committee, "We want the House of Commons to be with us in supporting investment amounting to hundreds of millions of pounds for the electricity industry," if he will not tell the House of Commons, either in Committee this afternoon, or in a fuel and power debate later, how the sums are to be furnished; whether by increased prices to the consumer, as we have seen with the London Electricity Board— and such a steep increase— or by resort to new borrowing on the money market.
§ Mr. Palmer
Is not the hon. Gentleman aware that the principal reason for this rather sudden increase in the price of London's electricity is probably the artificial price freeze imposed last year by the Government?
§ Mr. Robens
I have followed the hon. Gentleman's argument very closely. Would he say where the money should come from— whether from increased prices to the consumer, or from borrowing?
§ Mr. Nabarro
I will come to that point in a moment. I want, first, to deal with the London Electricity Board.
§ Mr. Robens
I am not referring to the London Electricity Board now. I am following the hon. Member's main argument.
§ Mr. Nabarro
I just want to finish off, if I may, this matter of the London Electricity Board. This increase has special significance at this moment, because the London Electricity Board has 1,700,000 consumers in this area, of whom 1½ million are domestic consumers. It is not an increased charge which falls for the most part on industrial production; it will be an increased charge that hits the householder.
I thought that a resident in London hit the nail right on the head this morning, because I received in my voluminous mail bag a letter from 194, Kennington Lane, London, S.E.11, which reads:The London Electricity Board have just announced a ½d. increase per unit for lighting and heating supplies. This will affect over 1 million homes. We are constantly being told that the cost of living must be pegged. Surely the Government should appoint a committee to inquire if this increase is justified. Little wonder that wage claims are being pressed forward by the unions. It is playing into the Socialists' hands. Trusting you Tories will give the matter your kind attention …I am giving it generous attention, because this is rather an important matter. I could not understand why, for example, the Table of the House of Commons accepted so many Questions to my right hon. Friend recently about the price of petrol. What is his position within the Statute? He has no statutory control over electricity prices. He has no statutory control over gas prices. He has no statutory control over the price of industrial coal, or over the price of oil or of motor spirit. He has statutory control only over one narrow sector of fuel and power prices. He has statutory control over the price of domestic fuel—
§ Mr. Nabarro
No. The right hon. Gentleman says "general direction," but one thing that his Government— and he was Parliamentary Secretary to the Ministry of Fuel and Power, preceded by his right hon. Friend the Member for Easing-ton (Mr. Shinwell) who was Minister of Fuel and Power— consistently refused to do was to give any direction to any nationalised fuel and power industry as to the level of prices. They took the line — quite rightly, I think— that those industries must pay their way, taking year with year.
No, this capital investment programme, in its present form, is likely to be exceedingly inflationary unless some intelligent price policy is enunciated by the Ministry for all forms of fuel and power, and unless we can be told what percentage of these vast sums of money is to be found from the internal resources of the industry, and how the residual which can only come from borrowing, is to be financed.
The Government have evidently given no attention at all to this matter— not publicly, at least. I decline today from expressing my own opinions— the hon. Gentleman the Member for Cleveland (Mr. Palmer) is pointing a finger of scorn at me for declining to give an opinion on it. The plain fact of the matter is that the conditions and circumstances of each of the industries vary so enormously, especially in technical considerations, that it is impossible, within the compass of a short statement, to give any conclusive view as to what percentage in the case of each industry should be found by resort to new borrowing, and what from internal resources.
If the hon. Member for Cleveland has any fears as to the accuracy of what I have just said, let him consider that approximately 70 per cent. of the cost of mining coal is wages, and that only a tiny percentage of the cost of producing electricity is wages— the remainder being largely in respect of the cost of fuel and the cost of amortising very expensive plant. Therefore, in this important context, there cannot be any set rule over the whole of the nationalised fuel industries, but what I am insisting on today, from my right hon. Friend, is that he should not escape lightly by presenting to this House a White Paper of capital investment involving huge sums 95 of money, without saying how it is to be subscribed and found over the period of eight years concerned.
§ Mr. Palmer
I will tell the hon. Member why I am not impressed with his case. If he is in favour, as he appears to be, of investment from internal resources— particularly in electricity— it certainly means a considerable increase in the price of electricity, which argues in favour of what he seems to be arguing against.
§ Mr. Nabarro
No, it does not necessarily mean a considerable increase in the price of electricity. If a proper fuel and power policy were applied to the Electricity Authority, it would immediately eliminate a very large number of wasteful enterprises pursued by the Authority today which are in no measure or wise concerned with the generation and distribution of electricity. I would not vote that Authority millions of pounds a year to erect expensive showrooms all over the country, or for it to pursue commercial activities. I believe that the function of the Electricity Authority is to generate and distribute electricity at the cheapest possible prices, and not to indulge the many extravagances about which pointed comment has been made on both sides of the House at appropriate moments during the last few years.
I want to pass from my views on these financial points to the question of fuel utilisation and efficiency which has figured so largely in many of the earlier speeches. I think that a good deal of progress has been made here during the passage of the last ten years, and the progress cannot rightly be attributed particularly to one or other of the main political parties. All have been concerned with it, though some more than others. In my opinion, as the situation existed at the end of the 1940s there were three outstandingly important fuel efficiency matters to be tackled by Government policy.
The first was the relatively low standard of combustion of coal in industrial boiler-houses which could most conveniently be attacked through clean air legislation. That clean air legislation is on the Statute Book. The operation of it has only just commenced. There is evidence of improved standards of combustion in boiler houses, but, of 96 course, it will take very many years before any significant improvement may be achieved.
The second of the three is in connection with the Private Bill, which is at present before a Committee upstairs, for the thermal insulation of buildings, and although this subject has been touched upon today, it has been my view for many years— and I am supported in this by hon. Members on both sides of the Committee— that little will be achieved until there is statutory compulsion.
In fact, last year out of 40 million square feet of new industrial buildings erected, and in spite of the quite low cost of thermal insulation materials, no more than 10 per cent. of all those buildings were insulated against heat loss. Yet it is a well-known technical fact that up to two-fifths of all the fuel employed in heating an industrial building may be saved by these simple insulating processes. I hope that if that Bill cannot find its way through the Private Bills Committee upstairs, it may be transferred to a Committee where the Government will give it the full support which most of us think it ought to have.
I want to say a word about my intervention in the speech of the hon. Member for Normanton on my third fuel efficiency point, which concerns industrial boilermen. The present position is very unsatisfactory indeed. Last year, there were about 700 boilermen trained up to the City and Guilds examination standard. There are approximately 80,000 boilermen in industry today. My right hon. Friend the Member for Sutton Coldfield (Mr. Geoffrey Lloyd), when he was Minister of Fuel and Power, coined the phrase, and used it extensively in fuel and power publications, that an unskilled boilerman could waste more coal in a day than a skilled coalminer could raise, and that is abundantly true. Yet we are training only about 700 boilermen every year out of 75,000 or 80,000.
The answer is that we are still continuing to rely on voluntary methods. There should be compulsion, which means that boilermen, after a given date should be required to have a minimum standards certification. That has admirable precedents in many foreign countries and is responsible for saving large quantities of coal.
97 I do not think that my right hon. Friend should continue to rely solely on the instrument of the National Industrial Fuel Efficiency Service to which he referred. It is a body which seeks the voluntary co-operation of industry. It carries out hundreds of surveys in the course of a year, but if an industrial firm does not wish to follow the advice of the advisory service and does not wish to invest the capital involved to secure higher standards for burning coal and associated fuels, then, as there is no compulsion the firm may remain in status quo, continuing to waste large quantities of coal.
I do not know the answer readily to this problem. The National Industrial Fuel Efficiency Service has made good progress, and generally has achieved its "surveys" objective in the last two or three years, but I feel that unless there is some degree of compulsion added to the work of the Service there may be no really significant results achieved during the next few years.
I should like my right hon. Friend or the Parliamentary Secretary to say how many surveys have been carried out in factories and in what percentage of those factories have the Service's recommendations been implemented. He will find, I think, that the figure is somewhat small. I would not impute to the Service any lack of desire to cover the widest possible field and to carry out the largest possible number of investigations, but the plain fact is that relatively very few factories act upon the advice which is given.
I hope that I may have answers to the various points that I have raised. Although fuel efficiency is important, I say to my hon. Friend the Parliamentary Secretary that the question of the huge capital sums required, and how it is to be subscribed and found over the next few years, is overwhelmingly the most important single consideration in this debate. If he cannot answer fully today, I think that on an appropriate parliamentary occasion in the near future we ought to be given many more details about the sources of the huge sums of money which Parliament is being asked for to finance expansion of the nationalised fuel and power industries.
§ 6.46 p.m.
§ Mr. C. R. Hobson (Keighley)
We all enjoy the speeches of the hon. Member for Kidderminster (Mr. Nabarro). I 98 only wish that they were delivered with a little less ebullience and what appears sometimes to be too much conceit. I think he spoils very useful contributions by falling into those two errors.
I am sure that the Committee is in agreement with the hon. Gentleman's remarks about fuel efficiency. Indeed, the Bill which he presented a short time ago, and which we all hope will become law, was supported by hon. Members on both sides of the Committee. There is complete agreement about that.
My hon. Friend the Member for Normanton (Mr. A. Roberts) developed the need for fuel conservation and fuel efficiency in a comprehensive manner. I was interested in his suggestion of bonus payments to stokers who save coal. I knew of some municipally owned power stations where that system was operated before nationalisation. The reduction in the amount of fuel consumed was considerable. Undoubtedly, attention should be given to the development of this scheme. I cannot accept the remark of the hon. Member for Kidderminster that the T.U.C. would be opposed to it. It is tantamount to saying that there is opposition to payments by results in every case, and, of course, that is not so.
§ Mr. Nabarro
The hon. Gentleman misunderstood me. The fact is that the T.U.C. has put itself in opposition to a system of certificating industrial boiler-men according to minimum standards.
§ Mr. Hobson
That may be so, but I understood that the hon. Gentleman was alluding to payments.
I want to refer to the London Electricity Board. I share the deep concern about this steep rise in charges; but, before developing that point, I should like to make it clear that the fact that it is a nationalised concern means that we are able to discuss the London Electricity Board. We are able to do so through Supply procedure, by having a debate on the Board's report and accounts, as we can with any nationalised body. Before nationalisation, when two-thirds of the industry was municipally owned, we were able to exercise control over generation and distribution through the local authorities. But it was impossible to raise in the House any matter relating to the remaining one-third of the undertakings which were privately owned.
99 The only redress we could possibly have against private companies was to object when they brought forward a private Bill, and try, by means of bargaining, to obtain a little more information about them.
I am deeply concerned about the whole structure of the London Electricity Board. I do not want to refer to the minor matter, which is now before the Committee of Privileges, of the sale of scrap, although I think it indicates that there is something wrong. On the question of prices, this steep increase of 10 per cent. cannot be excused on the ground that there was a price standstill. Every nationalised industry had a price standstill. Other area hoards had a price standstill, but those area boards which have increased the price of electricity have not increased it by 10 per cent.
What is more, in the statement made in the Press, in so far as I was able to follow it, there was no reference to the increased cost per unit that the London Electricity Board was having to pay to the Central Electricity Authority. I should have thought that that was a very relevant figure indeed. It is no use blaming the increase entirely on the increase in miners' wages or the increase in the cost of the transport of coal. These are factors of which we are aware, but at least one would have thought that we would have been told what increased price per unit the London Electricity Board was paying to the Central Electricity Authority.
I am amazed that there should be this increase of 10 per cent. That is not the whole story. About 18 months ago, the London Electricity Board altered the whole of the rental basis of electricity. It changed it from so much per point to an area basis, with the result that the average householder had to pay considerably more on the fixed charge. That is the sort of thing that is going on. I hope that the Committee will not allow the affairs of the London Electricity Board to go by just like this. I think that it is the duty of both sides of the Committee to have a whole day's debate on the affairs of the London Electricity Board, because the way in which it has increased the cost of electricity and played about with the fixed charges is something which I cannot find sufficient evidence to justify.
100 In considering this question of fuel and power, we have to remember that in this country we have only two assets of raw materials in excess of our needs. One is coal and the other is china clay. These are the only two mineral resources which this country has in abundance. It follows that there is enough coal in Britain for the needs of the country. The problem has been how to get it.
In retrospect, up to the beginning of the war, we were able to get all the coal we required and, indeed, to export coal. There was a falling off during the war largely because many of the young miners, as they always do because they make jolly good soldiers, volunteered with the result that the age of the men in the pits rose and the number of men employed at the pit face declined and were a wasting asset. We got into the state during the war in which coal had to be rationed, and, of course, coal has still to be rationed.
There have been welcome improvements recently. I should like to pay tribute to the miners for their increased production which has been very considerable in recent months, and also to the managements. There is no doubt that production is going up considerably to the benefit of the whole country. What we have to do as soon as possible is to stop importing coal which is paid for in dollars. I cannot understand the argument of the hon. Member for Kidderminster, who seemed to be objecting to the importing of oil, which we largely get for sterling, when we are having to import coal for which we pay dollars. I cannot understand his reasoning on that.
That brings me to the question of conserving coal and to the use of the small coal produced in the pits. The nationalised Electricity Authority has done a wonderful job in the way in which it is able to burn this poor fuel. It has altered the boilers with the result that a lot of coal which would have been wasted is being quite successfully consumed in the boilers of the power stations. What I cannot understand is the Ministry's policy — I do not know whether it is still so but it certainly was a year ago— of transferring coal burning plant in the power stations to oil burning boilers. Why should that be done? Why should electricity generation in this country be entirely dependent on oil? This change 101 over to oil is a serious thing when we consider the turbulent state of the oil bearing regions of the world. This is a policy which ought to be stopped, I should like to know whether any direction has been given.
Neither can I understand why there have not been some directives by the Government to stop municipalities from changing from trolleybuses to buses. This matter was raised in an admirable Adjournment speech— I regret that very few hon. Members were present to hear it— by my hon. Friend the Member for Cleveland (Mr. Palmer), and I think that most hon. Members who were present at that time agreed with it. What is wrong with trolleybuses? They are manoeuvrable, so they cannot be ruled out on that ground. They are cheap to maintain and they are clean.
§ Mr. Geoffrey Wilson (Truro)
Would not the hon. Gentleman agree that the trolleybus is inevitably confined to a particular route which cannot be changed if a street is up, whereas the bus is not?
§ Mr. Hobson
I do not accept that at all. That is the position today after we have scrapped the trolleybuses. What was the position when there were trams? It was possible to put them on different routes because the lines were there and we should be able to put trolleybuses on different routes because the overhead wires are there. But we are pursuing a policy of pulling down the network. Why is that going on? It is making the transport of this country dependent on imported fuel.
Quite apart from that, it has a very important bearing on the load factor of the power stations. I cannot understand why this is being done. In my opinion, the high-powered oil salesmen are so much in competition with their Yankee counterparts and all that is involved that they are using some of their methods in going to the transport managers and telling them to use buses. That ought to be stopped. I hope that we shall hear something about that when the Minister replies to the debate.
There is a further advantage. Reference has been made to the Clean Air Bill and to the using of smokeless fuels. Trolleybuses avoid the necessity of using diesel oil. There is a lot of talk about the effects of strontium 90, but I think that more people are affected by white bread 102 and inhaling diesel fumes than will be affected by strontium 90 either now or in fifty years' time.
To return to the question of the electricity board, I think that there has been far too conservative a policy pursued in regard to district heating. I admit that the siting of power stations comes into the matter, otherwise we shall have fairly heavy costs for pipes, calorifiers and other technical equipment required, but I do not think that sufficient consideration has been given to district heating, which is carried out most effectively in the industrial parts of Germany, the Ruhr.
We all take pride in the success of nuclear energy and in the atomic power stations which are now in commission and in which we lead the world. As Britons we are very proud of that. But the cost of the programmes for 19 more stations is terrific. I am beginning to doubt the wisdom not of the development of atomic power stations, but of having a number of small ones. I have not sufficient technical knowledge to say whether that is the right policy to pursue, but I feel that the atomic power stations ought to be larger units. I should have thought that perhaps we should have proceeded more slowly with more experiments in the existing stations rather than develop a series of 19 small power stations.
I hope that consideration is being given to that point, because I think it might have reduced the cost per kilowatt had we pursued a policy of large atomic power stations rather than many small atomic power stations. I begin to think that the programme of 19 small stations, with the one exception to which my hon. Friend the Member for Cleveland referred, may be a wrong policy in view of the cost involved, and I hope that serious consideration will be given to this.
Summarising my views, we ought to concentrate, as we are concentrating, on the greatest possible production of coal. We ought to concentrate on the minimum amount of oil imports. Obviously, atomic energy power production must proceed, but we ought at least to give serious consideration to whether we are having too many small power stations rather than two or three big power stations, because, from the very nature of the substances employed, there is obviously much experimental work still to he done. It might 103 be an expensive and foolish policy if we had all these small atomic power stations throughout the country.
We all welcome the White Paper. No party differences arise from it. We all recognise that the country must have power. It is particularly difficult for the electricity industry when the amount of electricity required doubles every ten years. It is a very expensive business. The White Paper has looked into the future as far as it is possible to do that with any degree of practical common sense, and I therefore welcome and support it.
§ 7.3 p.m.
§ Mr. J. C. George (Glasgow, Pollok)
I should like to join my hon. Friend the Member for Kidderminster (Mr. Nabarro) in congratulating the Paymaster-General on a very remarkable speech. It was eloquent and lucid and gave an extremely interesting and informative review of the future of this country in respect of its energy supplies. I was delighted with the picture which he painted of a nation of high investment and high production— a nation, I hope, with high wage rates and also high profits. I should like to think that this very high investment policy which we are pursuing will lead to a cessation of rising prices and to a time of falling prices, accompanied by lower taxation for the whole country.
There is no doubt in the mind of any hon. Member present that there is a tremendous opportunity ahead of us. If we could grasp this opportunity and cease fighting among ourselves, we could indeed open a brighter prospect for everyone in the country. Aided by the spread of automation in our industry and abundant power supplies, the standard of living in our highly industrialised country must move ever upwards. Providence and the scientists have put new keys into our hands for a brighter future.
Must we cumber, shackle and hamper ourselves with bitter labour relations? This highly enlightened nation, with all the money we spend on education, increasing annually, has reached a stage of labour relations which puzzles everyone. I wish the Minister of Labour well in his attempt to foster better relations in industry. I hope he will bring out the 104 Industrial Charter again; I hope he will pursue the idea of a contract for every employee; and I hope that both sides of the House will use every effort to bring in an era of better labour relations, being confident that better labour relations can do more to raise the standard of living in this country than even the nuclear power programme which we are discussing. If we could not only stop strikes but imbue the workers of this country and the management with a spirit of harmony and of working together, we could outstrip most countries in the world.
The right hon. Member for Blyth (Mr. Robens) said he saw no reason why we should not equal American production and, indeed, better it. I am afraid I cannot agree with him. America has tremendous natural assets which we do not possess. She has a tremendous market. The right hon. Gentleman rightly said that we may be in that position when the European Common Market is established, but America has that big market now and has always had it, and because of that the Americans can indulge in wide research schemes and can manufacture costly machines, knowing that they will sell enough to repay the research and make a profit.
They have natural gas and oil, and Nature has been extremely kind to them with respect to their deposits of coal, for their coal mining conditions are infinitely better than in this country. The existence of an iron mountain at Masabi has been a great aid to the steel trade in the United States.
The Americans have tremendous natural benefits, but I have had the experience of equipping a factory in this country entirely with new American machinery and of getting exactly American results. What the right hon. Member for Blyth said about labour in America and labour in this country is quite true; given the same facilities our men can produce at least the same results.
§ Mr. Robens
I met American industrialists recently who have plants in this country manufacturing identically the same goods as in America, and they get better production at cheaper rates in their British factories than in the United States.
§ Mr. George
I am chairman of one of the companies manufacturing American machinery in this country, and we can 105 produce more cheaply than in America. In fact, on that basis we have taken many export markets from the U.S.A. I do not think we can look forward to equalling American production, but there is a tremendous gap which we can close by obtaining the key to better labour relations. Let us strive for this for everybody in the country.
Let us follow the scientists and get on with the job. They have got on with the job in nuclear energy in the last few years and have added a new fuel to our energy supplies. We have timber, coal, oil and water; and now we have uranium, three million times more powerful than coal. We await the news about the fission process, through which, we are told, one quart of water will be equal to 20,000 tons of coal. I had hoped the Minister would tell us something about that. The scientists have got on with the job. Only eleven years after Hiroshima and only fourteen years after Enrico Fermi proved the control of chain reaction possible, we have Calder Hall, and today we are discussing a network of nuclear power stations all over the country. The hon. Member for Keighley (Mr. C. R. Hobson) said we should have gone ahead more slowly. It would have been better policy but not wiser policy to have gone ahead more slowly.
§ Mr. C. R. Hobson
I did not say more slowly. I am all for speed. I was suggesting that we did not want too many atomic power stations and that it would have been better to have concentrated on two or three large power stations rather than on nineteen small ones at the present stage.
§ Mr. George
Perhaps Calder Hall would have been a better power station had it been built later, but in that event it would not have been producing power in 1956 by a method which compares satisfactorily with that of conventional power stations. We are the first country in the world to accept the challenge of the cost of nuclear power and to face up to it, through our scientists. As a result, we are out ahead of the world today, due to the great work of the scientists certainly but also due to the work of the engineering firms. I had hoped to hear this mentioned in the debate because the scientists would not have been able to have done as well without the work of the engineering firms.
106 While I thankfully salute the scientist, I think that the Committee should salute the engineering firms who have taken up the building of these atomic power stations. They have shown remarkable speed in design and in preparing their estimates. It is worth spending a little time to consider the task that faced them. Four design teams went to Harwell in 1954 and spent only six months before they were suddenly confronted with the Government's first nuclear power plan early in 1955. That plan demanded that building should start in January, 1957. There was no time for experiments before serious design work had to start and they had only eighteen months to prepare the designs and to present tenders. I am told that the tenders sent in by these four competing firms weighed six tons. A tremendous task faced these men in building this first big commercial nuclear power station in the world, the first to replace fossil fuels by uranium.
It is right to say that these firms did not face the task in a selfish way. It is right to say that they put prestige before profit. They wanted the prestige of being the first to build a commercial nuclear energy power station. Their performance was an amazing achievement. In the process, they have shown how to double the output from these stations. This was private enterprise at its very best. We should give these firms our thanks.
We have discussed the cost of power from conventional and nuclear stations, but there is still a big margin to help nuclear costs. We need not think that every station to be built from now on until the fifteenth has been built will be exactly the same. Great improvements will be incorporated. We are not bound to any one design at any one time. There will be many designs and many changes. I had the privilege of visiting Calder Hall and seeing atomic power in the process of generation. Although I had tried to study the issue before I went there, those in charge explained to me the great margin that could be closed if new designs were brought into being. They have already found how to weld three-inch plates and raise the temperature inside the reactor and thereby obtain higher steam pressure, which means more efficiency.
Low temperature steam is still used in Calder Hall and old type turbines which 107 had been discarded long ago are now being used again for low pressure steam. All our efforts have been directed towards raising the temperature and raising the pressure of steam, thereby obtaining higher efficiency. That will come as the years go by. There is a great margin which can be and will be closed by ingenuity. If we can weld a four-inch shell, as I am told may be possible, it will mean higher pressure and higher temperature and, therefore, the use of more efficient turbines, leading to greater efficiency in generation.
We are told that by 1965 nuclear power will save 18 million tons of coal, or 12 million tons of oil. That is tremendously important for the nation, because every ton extra burned in the power stations means an extra ton imported. I wonder, however, whether the Government have taken enough time to sell this new, imaginative scheme to the nation as a whole and whether it realises how mystified people are at the prodigious figures which are issued by Department after Department—£ 1,200 million for the railways, £1,200 million for the mines and £5,000 million for electricity. People have given up trying to understand and now merely hope for the best. I hope that my right hon. Friend the Paymaster-General will think of a means of putting these figures to the people in a simple way so that they may know what is happening and may be convinced by reason, and not just by hope, that all this is for the best for the future of the nation.
The expenditure up to 1965 on conventional power stations is to be £630 million, on nuclear power stations £870 million, on transmission and distribution £1,200 million and, in Scotland, according to my estimate, £600 million. This makes a total of £3,300 million to be spent by 1965. Nowhere, in any publication, is there any indication that this vast expenditure will produce a reduction in cost. Capital expenditure is generally incurred by a company to reduce costs, to produce greater efficiency and either to earn higher profits or to pass the benefit on to the customer, or both; but we have had no indication that this vast expenditure will reduce the cost to the public.
My right hon. Friend has mentioned that the capital cost of a coal-fired 108 station is £58 per kilowatt and of a nuclear power station £153 per kilowatt. An allowance of £29 per kilowatt for the first charge would reduce the £153 to £124 and that, as my right hon. Friend pointed out, is the proper basis on which to compare the nuclear stations with the coal stations. I see it estimated that the Scottish No. 1 station will cost only £100 per kilowatt, possibly because an excellent and very easy site has been chosen.
This is a great national effort to expand nuclear power, and it is essential that in that effort we should keep good relations between the Authority and our citizens. In Scotland, initial errors have been made. A great deal of ill-feeling has been stirred up by clumsy action on the part of those responsible, in particular in connection with the Scottish No. 1 station at Hunterston. An unauthorised entry took place on to the estate. The lady who owns the estate found one morning a group of men working within the grounds without any request having been made for permission to enter. She asked what they were doing and for whom they were working. They refused information and asked leave to use the telephone. She gave them permission. They spoke for a considerable time on the telephone. Afterwards they refused to say for whom they were working and what was their business, but stated they had been told to withdraw if anyone objected to their presence. Later the authorities apologised to the lady concerned after I had written to the Secretary of State for Scotland.
The worst mistake made was the publication throughout Britain that a nuclear power station would be built on this site. Press reports expressed no doubt at all that the station was to be built, in spite of the fact that there is provision for appeal and for a public hearing. Before a public hearing was arranged— and one has now been held— it was made clear in the Press that the station would be built. It may not be built there, but the impression was created that the Authority was ready to ride rough-shod over the rights of the individual. I trust that greater care will be taken in future in this respect.
§ Mr. Emrys Hughes (South Ayrshire)
Another Government Department did almost exactly the same thing. In South Uist it rode rough-shod over the crofters. 109 The difference was that at Hunterson there was a public inquiry but at South Uist there was none.
§ Mr. George
I am at present dealing with nuclear power. I have not got round to rockets yet. The impression was created in the district that a public hearing would be a farce. We do not want that impression to be created in Scotland or in any other part of Great Britain. A public inquiry is the citizen's defence against authority. The sanctity of that defence must be maintained. I hope that in future greater care will be taken.
The whole country realises that this atomic energy programme must go forward. People are prepared to accept that fact, even though it may upset their lives, provided that they are warned beforehand. We have advanced along the road to nuclear power and we are the first in the world to do so. In addition, because of the work of our scientists, we have the ability to export large nuclear power stations and to open a new era of prosperity for the country. Some of the benefit should be set against the cost of research work for which the Government have paid in recent years.
We have not been slack in Scotland in this respect either. The Minister may have noticed that a Scottish firm, Humphreys, of Glasgow, has joined with an American firm, Alco, to manufacture small nuclear power stations, producing 10,000 kilowatts, known as "packaged" stations, costing £200 per kilowatt, and producing power at between 1½d. and 2d. per unit. These may have a wide application to remote areas of other countries. Scotland, therefore, has firms which are able to export large and small atomic power stations.
Also, we have been paying attention to the needs of power in the years ahead. The Scottish Hydro-Electric Board has made good progress with its programme to harness the rivers of Scotland. The South-West Electricity Board has just finished a 5-year plan for rural electrification in the South-West of Scotland, and another is just commencing to connect 2,500 farms and 7,200 isolated homes.
I am as keen as anybody for Scotland to have delegation of authority, but I wonder if the time has not come to think again about the separation of the electricity authorities. We have the North of 110 Scotland Hydro-Electric Board, the South of Scotland Electricity Board and the Central Electricity Authority for England and Wales. There will come a time, perhaps before 1963, when a very great decision will have to be taken. That decision is, are we going to stop hydroelectric development? Are we going to stop building conventional power stations? I believe that decision could best he reached if an overall view were taken of the national position. Much as I like Scotland to have its affairs under its own control, it might well be that we should retrace our steps for the benefit of the country as a whole.
The Minister referred to indigenous materials and asked, why rely on indigenous fuel if imported fuels are cheaper? I wonder if he had in mind the shale industry when he said that? If he had not, may I renew an appeal to him? My right hon. Friend said that his first duty was to ensure adequate fuel supplies—
§ Mr. Maudling
If I may interrupt my hon. Friend, I was not thinking particularly of shale oil or of any one source of fuel. I was thinking that, whilst we want to make the maximum use of indigenous fuel supplies, we must also take into account the fact that it may be an expensive process sometimes to rely on indigenous fuels when imported fuels may be cheaper. That is a general problem we shall have to consider over the next few years.
§ Mr. George
Would my right hon. Friend refer to his earlier remark, when he said that his first duty was to ensure adequate fuel supplies and protect indigenous production? Would he apply that to the shale industry of the Lowlands? I took time during the Recess to go down the shale mines in the Lothians and to visit the distillation plant there. I formed the highest impression of the efficiency of that company on the surface, although something more could be done underground, where conditions are difficult. However, there is a first-class relationship between the workers and management. I felt that I had stepped back thirty years, because there was a family feeling between management and men, all desperately interested in the welfare of each other.
There are 3,000 people in the Scottish shale mines in that area, and if the industry is closed it will be a black day for 111 that part of West Lothian. So I ask the Minister to review the position. I want to repeat a proposal which I made once before in this House. If nothing can save the industry, if it is losing money to the extent we are told, if there is no prospect of meeting the cost of production, then the industry should be nationalised by the Government and put under the control of the National Coal Board in order to keep that village alive.
I am strengthened in making that suggestion for one main reason. It has been reiterated time and again how delicately poised are our oil supplies. Here is an indigenous supply which, I am told, could run all the transport in Scotland. Apparently it cannot pay enough in taxation and so it must close down, yet I understand that it is paying £6 per head per week in taxation—
§ Mr. Cyril Osborne (Louth)
May I put a point to my hon. Friend? Surely he could not apply that principle to every industry in the country— that because it is losing money is should be nationalised, and therefore supported by the taxpayer. If that were done we would all be taking in one another's washing, and it would be very dirty and very expensive.
§ Mr. George
But this is a special case, because it is the only source of oil in Scotland. That is why I felt able to make the suggestion. We cannot ignore this source of oil which could keep our transport running. We have just had serious difficulties, and we may have them again. Some day we may be glad to have that oil, so the position should be reviewed.
§ Mr. Osborne
May I remind my hon. Friend that the hon. Lady the Member for Coventry, South (Miss Burton) made an almost identical plea for the Coventry workers when she said that the Minister ought to provide them with work for which there might be no necessity? If that principle were applied throughout the country, we should bedevil one another. I ask my hon. Friend to look at this from the point of view of the taxpayer, which is why we are all in this House.
§ Mr. George
I appreciate the anxiety of my hon. Friend about other industries, but oil is a very special case. [Laughter.] 112 This is not a matter for mirth. It is a serious matter and I trust that hon. Members will take it seriously.
Now I pass from oil to coal. I have considerable anxiety about the vast capital expenditure in the coal mining industry. We have all seen the 1950 plan and the 1956 plan. The changes made were accepted by the country without a ripple on the surface because people have ceased to try to appreciate why these vast sums of money are being spent. This is what has happened. The 1950 plan involved an expenditure of £635 million. The 1956 plan contemplated an expenditure of £1,147 million. For the former expenditure we were to get 238 million tons of coal and for the latter 228 million tons. The 1950 plan envisaged a reduction of manpower to 618,000, but the 1956 plan raised that to 682,000. Both envisaged an output of 240 million tons by 1965, but the 1956 plan depends on the continuation of opencast coal which the 1950 plan abandoned.
These figures are worth a great deal more thought and scrutiny than they have had, for who would say to the nation that the scrutiny which such plans receive in this House is efficient in view of the vast sums of money involved? As I understand it, the area concerned draws up a plan for the National Coal Board, then it goes to the division, then to headquarters and then to the Minister. As far as I know, the Minister has no technicians to check the plans.
Neither is this House in a position to check them. The Report of the Fleck Committee expressed serious concern about the lack of scrutiny given to plans by the National Coal Board. Who is to scrutinise the plans, and what guarantee has the country that the £1,147 million is being properly spent or that the estimates made are reliable? Indeed, I do not think they are reliable, because the output for the first eight weeks of this year was running at about 240 million tons, which was not supposed to be possible until 1965.
That is why I made a plea that "Investing in Coal" should be studied. Some of the results from that investment should be added to the forecast of 240 million tons which the collieries have shown themselves capable of producing now.
113 I have other anxieties, also. The Minister spoke of an output of 240 million tons in 1965, but there are many snags which he did not mention. The bonus shift penalty has been taken off. That is estimated to lose 4 million tons a year. Saturday working is being retained, but it can be withdrawn at any time. That represents 11.8 million tons at the moment. The demand for a reduction in working hours from 7½ to 7 per day will, if met, cost £10 million, and an extra week's holiday, 5 million tons. The new Coal Mines Act is now beginning to have an effect, and is estimated to reach the equivalent of taking 5,000 men off production. All these losses could in total equal and exceed the extra coal which the plan says can be produced by spending £1,000 million.
This matter should be given serious thought. We cannot bank upon an output of 240 million tons. Up to now the National Union of Mineworkers has been successful in obtaining almost everything it wants.
§ Mr. George
If it wants half an hour off its day I believe it will get it, and if it wants extra holidays I believe it will get it. We cannot budget for an output of 240 million tons while we neglect the possibility of these losses being encountered.
I now want to direct the attention of the Committee to the execution of this plan. We have the greatest programme of shaft sinkine, of any country, yet we are going down at the rate of only 80 feet per month. The Iron and Coal Trades Review of 8th March reported that in Russia and South Africa they were sinking shafts at the rate of 650 feet per month, in similar conditions.
§ Mr. Emrys Hughes
After the hon. Member made a previous speech I put his point about the comparative rates of sinking of shafts in Britain and Russia to the people concerned, and their explanation was that the safety regulations in this country would not permit sinking a shaft at the rate the hon. Member mentions.
§ Mr. George
Safety regulations may be tighter here, but there is a tremendous difference between 80 feet and 650 feet. There is room for investigation of this matter by the Minister.
114 We also know that by using horizon mining we have become engaged in driving many more miles of tunnel, and we should be driving them at a faster rate. Here the rate of drift driving is about 80 yards per month, but in France — again I quote from the Iron and Coal Trades Review— they travel at a rate of 330 yards per month, in drifts of ten by fourteen feet. Conditions are roughly the same, and there is, therefore, room for examination for this aspect of the matter. If we are going to spend vast sums of money let us spend them as quickly as possible and get a return as quickly as possible.
Many reasons have been given for the need to export coal, but to my mind they are the wrong reasons. Surely the real reason why we should export is in order to retain some of our old customers, who depend entirely upon us. My worry is that we have too lightly disregarded many of these customers, whom we may need again, even this year. If we ignore them for too long, they may obtain another source of supply, which they will not want to lose, or they may turn to oil. It is of vital importance that we should export coal as quickly as possible.
I believe that we should be able to obtain an output many millions of tons in excess of the estimated 240 million. I listened with eagerness to the Minister when he said he was considering producing oil from coal. We should have been experimenting with the German system long ago. The Fischer-Troptz system has been built in South Africa, but has proved a failure there. They are losing heavily from it, but they are determined to make it work and get oil from coal. We should profit from their experience.
My hon. Friend the Member for Kidderminster (Mr. Nabarro) was rather nervous about the question of price policy. The Minister mentioned that the boards may have to review this policy in the future. I think that they should. If it has to be paid from below the line it will be a heavy burden upon the country. The policy must be reviewed in order that more may be obtained from savings within the industry.
This whole programme is an immensely challenging task for the Minister. The co-ordination is complex but the reward is prosperity, and it is well worth fighting for. The Minister said that an 115 increase of 3½ per cent. per annum in output would give us double our present standard of living in 25 years. I do not think that anybody has any doubt that we can double our standard of living in that period if we have the imagination necessary to carry out these development plans. With the good will of workers and managements there is no need to preach decadence and decay. In this nuclear age this country is well in front. Let us determine to keep it there.
§ 7.36 p.m.
§ Mr. Arthur Palmer (Cleveland)
The hon. Member for Pollok (Mr. George), in an optimistic frame of mind, has put many points before the Committee. It is beyond my mental resources to take them all up in detail, but I noted with interest that, by implication, he condemned the past policy of his own Government in splitting the South of Scotland from the integrated system for the whole of the United Kingdom in the matter of the supply of electricity. I would remind him that hon. Members on this side of the Committee opposed that policy not on narrow party grounds, but because we felt that it would tend to operate against general national electrical efficiency. I am delighted to know that the hon. Member, who is an expert in engineering matters in his own way, agrees with the attitude adopted by us on that occasion.
I was also interested to note the praise that he gave to the engineers and technologists who had made possible the nuclear energy programme. As a fellow engineer, I gladly accept what he says about that. He went on, however, to talk about the great job which, he said, private enterprise was doing in this programme. I would remind him that the real pioneering work was done by public enterprise.
I now want to turn the attention of the Committee to the main purpose of our exercise this evening namely, the discussion of our fuel and power policy. The Paymaster-General made an attractive speech, and I agree, up to a point, with the trend of his opening remarks. When I look at the fuel and power industries, as a Socialist my first reaction is always to be rather appalled at the lack of order, but I appreciate, at the same time, that we must not expect too much. We need a 116 policy rather than a plan, because the time scale involved is very considerable.
It is no good human beings looking ahead for too long a period. We can look ahead for one, two or even five years with reasonable success, but to prophesy what will happen ten years ahead is a much more difficult business. In addition, the amount of money to be invested is enormous, and any mistake that arises as a result of too much rigid forward planning might easily be financially disastrous.
Technical developments might easily cause schemes, which, today, seem quite desirable, to become out of date. We need more order, more organisation, but we must not be too grand about it. We must be humble and allow for the flow of changing circumstances for the fertile, energetic spirit of our scientists and technologists. Also, we have to take into account international developments over which we can have little control. Having said that, and being prepared to go that far with the Paymaster-General, I must add that, nevertheless I think that, on balance, the right hon. Gentleman was just a little too vague and general.
In this matter of a fuel and power policy for the country there are, in my opinion, at least three plain signposts guiding the way. The first I would define as the need for sufficient energy to bring supply in balance with demand and to keep it there. The second, surely, is that we need energy from the most economic and suitable sources. Thirdly — and not enough has been said about this— avoidable fuel waste should be made very expensive or even illegal. I appreciate that at the moment a great deal of waste is unavoidable, because of the limits on our technical and scientific knowledge, but there is a vast amount of quite avoidable fuel waste. I suggest that these three signposts point the way to a fuel and power policy which would not mean too much rigid planning.
I wish to spend a little time examining the question of obtaining sufficient energy from suitable sources. Today, we have had a lot of sums worked out about the balance between coal, oil, nuclear energy and so on. For my 1956 sum I am prepared to take the figures given in the Economic Survey, which mentions 254 million tons of coal, or coal equivalent, as representing the present total energy 117 demands of the nation. For 1965 the figure I have obtained— on the very fallible assumption of a 23½per cent. to 3 per cent. increase in the national income which has been referred to— is probably 300 to 320 million tons of coal or coal equivalent. We can divide my 311 million tons up as follows. For 1965, I have divided it into 240 million tons for coal which is the figure given to us— perhaps a little optimistically— by the Coal Board 51 million tons for oil 2 million from sundry sources and nuclear energy, on the revised assumption of 18 million tons of coal or coal equivalent.
I agree with the Paymaster-General that one must not be too fixed or too wooden about these figures. I should have thought that the outstanding point about them is that they represent a capital expenditure over ten years, on electricity from coal, and nuclear fission, of over £3,000 million, and, in the coal mines, of £1,000 million and, in the gas industry, of £400 million, which gives a figure of £4,400 million as the total expenditure over the next decade. But, after having spent all that, in spite of having done all we can to increase coal production and with a nuclear investment programme which is possibly the most ambitious in the world— and with which, on principle, I do not quarrel— our oil imports will still have shot up to between 30 and 40 per cent, more than the present figure. I consider that a point to which the Committee should pay attention, and I should like the Paymaster-General or his hon. Friend to deal with it in reply.
In spite of all our efforts to develop our own indigenous sources of energy, ten years from now we shall still be importing a vast amount of extra oil. How does that square with the statement in the Appendix to the White Paper which I am at a loss to understand because of its wording? It states, in pate 9:The burden on the nation's balance of payments which arises from our growing dependence on imported fuel will be substantially reduced by this expansion of the nuclear programme.I consider that an extraordinarily sunny statement, in view of the figures which I have given and which, I think, are close enough to the figures given by the right hon. Gentleman as to make no difference. I feel that the statement contained in the White Paper is remarkably misleading.
118 We should not deceive ourselves. It is true to say that without these great efforts which it is proposed that the nation shall make the demand for oil would be even greater. But the fact remains that in a decade from now we shall need one third to one half more oil than we do now and we shall be obliged to pay for it in one way or another in terms of exports.
Reference was made earlier to the international political uncertainty of the oil supply position which was made clear to us all by the recent experiences over the Suez Canal. We cannot do without oil. No modern industrial nation can. We must have it for industry and agriculture. Food production depends on oil which we use for our tractors— the horse has disappeared from the agricultural scene— and, of course, we need it for transport. But I cannot make the point sufficiently strongly that if we must have oil— and we cannot escape, also, from the necessity of having extra amounts of oil— surely its use should not be encouraged where energy derived from home sources could do the same job. Surely that should be a primary aim of any fuel policy which we embark on at present.
My hon, Friend the Member for Keighley (Mr. Hobson) referred to an Adjournment debate which I initiated— when I was supported by hon. Members from both sides of the House— in which I referred to the great fault of the London Transport Executive in changing over the rest of its surface traction from electrically driven trolleybuses to diesel oil buses. We had no satisfactory answer to the questions which were then raised, and, with great obstinacy, backed I am sorry to say, by the responsible Minister, the London Transport Executive is persisting in that mistaken policy. However, I do not wish to say too much about it although I feel very sore and annoyed over the matter. It is a shocking policy and should not have been adopted.
Apparently it is the intention to continue with extended use of oil in power stations. I will be frank, and say that there was a time when I thought that this was, perhaps, an inevitable development. But I am now certain, particularly with the advent of the nuclear power programme, that we should not extend the use of oil in power stations any further. I understand that at the height of the Suez crisis the Central Electricity Authority 119 was told to go slow in this matter because it was not always possible to get the oil. But now I understand that oil supplies for the three oil-fired power stations have returned to normal and I am informed that the Authority is prepared to place contracts for further oil-fired power stations. I suggest to the right hon. Gentleman that that is a decision which should be examined again.
Coal resources have been abundant this winter. Reference has been made to the patriotic efforts of the miners. All these things have helped us in recent times and I make allowance for them. Nevertheless, if we have faith in our nuclear power programme and our policy of modernising the coal industry— both of them indigenous sources of power— let us be bold enough not to use oil where that is not absolutely essential.
§ Mr. Osborne
Would not the hon. Gentleman agree that few people realise that, in the last ten years, oil imports have gone up from 2 million to 28 million tons annually? My right hon. Friend seemed to overlook that point. The hon. Gentleman says that oil imports will go up to 40 million tons per annum and even then we shall only be all square by 1965, yet no account has been given so far of the probability of our having to pay far more for the oil that we get. I should like to hear what the hon. Gentleman says about it. If the people in the Middle East, living at about one-fifth of our standard of life, are no longer satisfied to export their raw materials to us and so give us a higher standard of living than they enjoy, what is to happen?
§ Mr. Palmer
I entirely agree with the hon. Member. The indication is that prices will increase. I was interested in his point about the increase in oil imports. Even last year, in spite of fuel rationing, our oil consumption went up by 8 per cent. It is going up all the time.
Reference has been made to the probable surplus of small, low-grade coal that is burnt by electricity generating stations. I have it on very good authority that the development of nuclear power stations will tend to create a surplus of this kind of coal. That is not to say that we shall have a general surplus of the other qualities, but we should push ahead to see whether the small low-grade coal can be turned into oil, and there is a 120 case for further research expenditure on that.
The nuclear energy programme is fully justified. Not only is it a significant contribution to our energy needs, but it is of great value as a testing ground for a vast new exporting industry. We shall not always have the lead that we have today, so it is important to get in early. When it comes to replacements we are likely to hold the markets and not our competitors. I have worked as an engineer in industry and I know the natural, unconscious bias of the expert to go on using the same methods first used.
If anyone asks me whether the programme is of the correct size, my reply is that I do not know. I do not believe anybody knows the correct size of the nuclear energy programme. Coal will certainly remain the primary energy source of the country for the reasonable future. Even if all the power stations are nuclear stations, as they probably will be, we shall still have much to do with our coal. If we continue full employment we are not likely to have a fuel annual output greater than 250 million tons or more. If we have a greater output, then we shall only be using up our coal resources the faster. The country needs as big a nuclear energy programme as our financial and material resources will sustain. That means using nuclear power for electricity, which is the only present way of using it at all.
I am sorry that the hon. Member for Kidderminster (Mr. Nabarro), who usually sits below the Gangway, is not here at the moment.
§ Mr. Palmer
I apologise to the hon. Member. I am flattered that he has bothered to return to the Committee to hear my few remarks. I apologise, as I just had not bothered to look to the farthest corner of the Committee.
The hon. Gentleman referred to a most important question, which we discussed at length in Committee on the Electricity Bill, how far the publicly-owned fueland-power industry, particularly electricity, should finance its future development from its own resources, and how far it should come to the Treasury for finance or go to the money market.
The hon. Gentleman will remember that during the Electricity Bill debates his 121 right hon. Friend gave us an outline of what passed for Government policy. The Paymaster-General said that it all depended upon circumstances. However, broadly speaking, the Government seem to be in favour of more use of the internal financial resources of these large-scale industries for their future development, and, if so, I think that they are perfectly right. I support, as far as my support counts for anything, the idea that nationalised industries should here imitate large-scale private undertakings, like the chemical and oil industries.
On the other hand, I have no illusions about it. The hon. Member for Kidderminster seems to think that that kind of thing can be done without increasing prices. I shall not enter into the merits of the proposed increase of prices by the London Electricity Board, because I have not had an opportunity of looking into the figures and reaching a conclusion, but any fair-minded critic would say that electricity is sold a little too cheaply in this country. Electricity prices have gone up an average of 30 per cent. or 40 per cent. over the pre-war position; against the general price increase that is remarkably small.
One effect of public ownership is to keep prices artificially low, because the management boards concerned fear the unpopularity which comes if prices are raised. It is hard to believe that a privately-owned industry, even affecting vast numbers of citizens, would have had the same amount of hard publicity in last night's London evening newspapers as did the London Electricity Board, after its announcement of price increases. The price of electricity is a little too low today and I can see nothing wrong at all, as a matter of general public policy, in increasing electricity prices, provided that the increased revenue is used to finance future developments.
§ Mr. Nabarro
The hon. Member is making my point for me. I said quite clearly in my speech that it was difficult to determine why this very large increase in price to be charged by the London Electricity Board is to take place. The Board did not say whether it was to cover operating costs or to provide, as I termed it this afternoon, for a surplus to finance future capital investment. Therefore, it is an artificial price increase. That is the 122 information I want either from the Board or from my right hon. Friend.
§ Mr. Palmer
I accept what the hon. Member says, but it does not contradict what I said. If we want more internal financing that inevitably means certain price increases.
§ Mr. Palmer
I think that it probably does. May I give the hon. Member a figure which I am sure he will treat with respect and which, I assure him, is an accurate one?
On the generating side of electricity supply the cost per kilowatt of installed plant is no more today than it was in 1948 at the time of nationalisation. That means that in the matter of capital investment the electricity industry has used very great economy at a time when prices of all kinds have increased, including the price of coal which so much determines the price of other commodities. The electrical industry has managed to keep the price per kilowatt installed for generating capacity at much the same figure.
§ Mr. Nabarro
The hon. Member must not lose sight of the fact that last year the electricity supply industry sold nearly 10 per cent. more current than it sold the year before and that has been a continuing process. In practically every other large-scale enterprise, as the volume of output and sales increases, it is generally possible either to stabilise or reduce the price to the consumer, but there has not been any of that kind of process evident within the electricity industry.
§ Mr. Palmer
I must disagree with the hon. Member. I should have thought that in relation to real prices generally the price is much lower than it was before the war in fact, about half. That is the reason electricity is used so wastefully.
§ Mr. Palmer
The hon. Member has talked about the automatic progression of electrical consumption, but the truth is that the expansion of use of electric power since the war has been rather less than it was before the war; it is a little lower.
123 Between 1920 and 1938 electrical consumption advanced on an average by about 10 per cent. per annum. Since 1945, electrical consumption has tended to advance between 7 per cent. and 8 per cent., which is less than in Germany or the United States of America. We should not assume that we in this country are developing our electrical power resources too lavishly. On the contrary, the trend is rather the other way. I think that when the figures for last year are published we shall discover that the expansion of electric power production has dropped considerably compared with the previous year.
Here, I would agree with the hon. Member that as we are proposing to spend £3,000 million over the next ten years on power station development, whether in nuclear form or conventional form, we certainly want the maximum advantage.
§ Mr. Palmer
I am not going to accept the argument which the hon. Member uses so glibly when he concentrates on showrooms. Once before. I told him that they are a fleabite in relation to the total capital investment of the industry. I do not accept the argument that the electricity supply industry wastes capital. That industry does not control it in the end. Expenditure of capital is created by demand and controlled by other industries. I agree, however, that for every single pound spent we must have the maximum advantage in output.
We have to spend larger sums on further research to improve power station efficiency. Great progress has been made, but we should not be complacent because our power station efficiency is still lower than that in America. I hope that the new Generating Board will be able to give single-minded attention to these questions. It will not be diverted to wider questions of the supervision and distribution side of the industry, but be able to concentrate on much further work to step up the efficiency of our power stations. I think that the High Marnham station is likely to be a model station for efficiency and that there should be no limit to the aim of achievements of that kind.
124 If we are to get the maximum value from money spent on power station development, we must also improve the load factor of the system. I do not think that, in the end, we can escape from having a great deal more shift working in the industry, in consultation with the trade unions. I speak as one who is often a friend and defender of electricity supply in this House, but I think it must get away from some of the old-fashioned ideas on tariffs, and so on, which date from the 1930s. It must have special tariffs which will really encourage an improvement in the load factor, but at the same time as we put that point of view we must not also argue that the electrical power industry shall publicise itself through promotional advertising. It must do promotional advertising if only to improve the load factor.
§ Mr. Palmer
Automation should help in this direction, of course.
I believe that these are all issues to which the Minister of Power should be directing attention. At various times I have been an advocate of the idea of a Ministry of Energy. I agree that the title is a little unfortunate and might be embarrassing for a politician who became the Minister. I appreciate the discretion of the Government in shortening the title of "Fuel and Power" simply to "Power". That is less compromising and ambiguous.
§ Mr. Palmer
The question to which I feel the House of Commons has not given attention is how this new Ministry of Power really differs from the old Ministry of Fuel and Power.
§ Mr. Palmer
It has got steel, but apart from that, I cannot see much difference, except the change of name. Perhaps I had better tread warily, but the Atomic Energy Authority is not responsible to the Minister of Power but is still responsible to the Lord President of the Council. In spite of recent changes and resignations, the two right hon. Gentlemen are in each case noble Lords in another place. How we are advancing towards the idea of a really responsible comprehensive 125 Ministry of Power I have great difficulty in understanding.
There will be no Minister of Power worthy of the name until there is one who has brought in a practical fuel conservation programme. When we have a Minister of Power, or Minister of Energy, or whatever he may be called, who will do that, we will have arrived. Volumes have been written and innumerable speeches have been made in the House of Commons about the disparity between the country's gross energy output and net energy utilisation. The Paymaster-General added a little to that today.
From the vast sums which we are quite properly proposing to spend on coal mining development, nuclear power stations and oil refineries, we can spare much more money for investigations into methods for massive economy in energy utilisation. I have said before, and it is a certain criticism of this side of the Committee, that when we enjoyed office— and I think that we shall enjoy it again very soon— although we nationalised the fuel and power industries, we did not organise them in relation one to another.
We shall know that we have made some progress in this matter in the future when in the fuel and power industries, electricity, gas, solid fuel, and, I hope, oil, we have moved to a conception of selling energy rather than selling any one particular form.
§ Mr. Nabarro
The hon. Member said, "I hope, oil". Does he mean that it is the policy of his party to try to nationalise oil?
§ Mr. Palmer
My nervous system would not be capable of dealing with the responsibility. I must leave that to others. I said nothing of the kind.
I am prepared generously to admit that we have made some progress in recent years both under the Government of my right hon. and hon. Friends and under the present Government. But if we were really honest with ourselves we would also admit that we still have no real, overall energy policy worthy of the name. We have, instead, a number of enthusiastic 126 but separate and sometimes incompatible policies. We have today had a sparkling parliamentary performance from the Paymaster-General, but I am afraid that I was not impressed by it as a practical move towards the integrated fuel and power conception which I believe the country must have in the end.
§ 8.13 p.m.
§ Mr. Geoffrey Wilson (Truro)
It was not my good fortune to hear my right hon. Friend, nor the following two or three speeches, and I should not have ventured to intervene but for some remarks of the hon. Member for Keighley (Mr. C. R. Hobson) and my hon. Friend the Member for Pollok (Mr. George), with which I did not agree and which should not be left on the record without some comment.
The hon. Member for Cleveland (Mr. Palmer) took up a point made by his hon. Friend the Member for Keighley about trolleybuses and trams. I understood their argument to be that they supposed the principal reason for the change from trolleybuses and trams to buses had something to do with fuel and power and that it was a bad thing because it would mean the use of an imported source of fuel and power rather than one indigenous to the country.
The changeover from trams and trolleybuses to buses has little to do with sources of power. It is a matter purely of convenience in congested areas. It is absurd to continue with their argument. People who are making these changes are people who started with trams. In many cases concerns which now operate buses were originally tram owners who changed to the use of buses because the bus is a more convenient vehicle in traffic. That is happening in many places throughout the world.
The hon. Member for Cleveland answered his own question when he talked about importing oil and using it in power stations. The plain fact is that there is such a shortage of power in this country that we have had to increase our imports of oil to such an extent that some of that oil has had to be used in power stations, which is perhaps not a very suitable way of using it.
§ Mr. Palmer
The hon. Member must surely see that there is a short-term aspect and a long-term aspect. I was 127 looking ahead to the long-term aspect and arguing that, if possible, we should become less dependent upon imported coal.
§ Mr. Wilson
The problem is not confined to this country. It is common to all Western Europe. The hon. Member is probably familiar with a Report produced by O.E.E.C. last year, "Europe's Growing Needs For Energy. How They Can Be Met." That document referred to Great Britain and to all the countries of O.E.E.C. and Western Europe. In the summary arc these very striking sentences:The primary energy requirements of Western Europe by 1975 arc likely to amount to 1,200 million equivalent tons of coal, a figure which, under favourable or unfavourable circumstances, might rise to 1,300 million tons or fall to 1,100 million tons. According to our forecasts based on present plans primary energy production in Western Europe is likely to amount to about 750 million equivalent tons of coal by 1975.That means a gap of 450 million tons of coal equivalent by 1975 and the Report pointed out that that could be met only by imports.
§ Mr. Nabarro
My hon. Friend cannot compare power circumstances in Western Europe with power circumstances in the United Kingdom. Most of the electricity development in France, for example, is based on water power. In Scandinavia, it is largely based on water power. If my hon. Friend's argument is valid, why is public transport in Amsterdam, Brussels, Copenhagen and other capital cities of Western Europe still based on trams and trolleybuses?
§ Mr. Wilson
I will come to that in a minute. My hon. Friend has not understood my point.
The Report refers to Great Britain as well as to other countries of Western Europe. My argument is that the overall deficiency of power in Western Europe means that into Western Europe must be imported large quantities of fuel, including oil, and in this country we are using oil for power stations. It is, therefore, not correct to say that merely by continuing to use electric trams we will save anything at all, because we will merely shift the use of oil from one part of the country to another and it will be used in power stations instead of on the roads.
The proper economic use of electric power would be on the railways. I and 128 a number of other hon. Members on both sides of the Committee have just returned from an inspection of the French Railways. We made a very extensive tour by courtesy of the French nationalised railways. All the members of the delegation were very impressed with the electric lines. The French have gone into electrification in a very big way, bigger than we are contemplating, and certainly bigger than anything which we have at the present time. They are most efficient. At what cost is another matter, but, of course, the French railways are run under financial arrangements different from ours. There is no doubt that electric traction on railway lines is a very efficient and effective means of transport, but in a congested street electric traction is a different matter. To urge its use for trams is not a good argument to put in favour of the use of indigenous fuels. We want to use our fuel resources in the most effective way.
That brings me to my second point, which the hon. Member for Keighley also mentioned. He wondered whether there were not too many small nuclear power stations. I do not think that they can be described as small, but I should have said that far from there being too many, we might have a few more and have them more widely scattered, because the cost of conveying large quantities of electricity over large distances is considerable. To put atomic power stations in areas where there is no coal is a very good policy and one which should be extended rather than restricted.
§ Mr. Wilson
I should like one very much in Cornwall, and I could even suggest a site for one. Apart from that, I think that localised atomic power stations might lead to a greater use of pumped storage.
We have heard that that is being investigated in Scotland. The idea is that of pumping water up to a height by means of electricity generated in nuclear power stations during the periods when there is not much use of electric power so as to provide extra electricity supplies during the peak periods, by using the water for hydro-electric purposes. I understood that my hon. Friend the Member for Pollok rather queried whether hydroelectric power was something with which we should continue or which we should expand.
129 That comes back again to the same point about the general shortage of power in this country. I think that our shortages are such that we shall have to use every form of power that we can possibly find, and that wherever there are opportunities of using hydro-electric power in this country, and there will not be very many, then we certainly ought to use them. Once the stations are installed they continue with little maintenance for a very long time, since once the installations have been provided the greater part of the cost has been met. We must use everything that is possibly available to us.
I hope that we shall go forward with our atomic power programme as quickly as we can, and I am sure that we shall, because one of the most remarkable things about the atomic energy position is that every time that estimates are made, they seem to he exceeded and the programme gets ahead of schedule. I have no doubt that it will be the same in this case.
§ Mr. Wilson
I feel that in general we have a bright future to look forward to with regard to our power situation, notwithstanding the shortages that are at present experienced in this country.
§ 8.23 p.m.
§ Mr. George Darling (Sheffield, Hillsborough)
On the last occasion when we debated fuel and power I said my usual piece, which apparently I am going to go on saying for many years, about the need for an intelligent carbonisation programme to deal with our coal supplies. I was glad today to see that the Paymaster-General was coming along and making progress in this direction. The right hon. Gentleman did talk about carbonisation, but he gave no indication at all of the kind of programme he had in mind. He talked vaguely about making use of small coal that may not be needed in the power stations of the future, and he also spoke of carbonisation as a general policy, but he gave us no details at all.
This will not do. We must stop burning raw coal. We cannot get the smokeless fuels that are now needed, and which will be needed more in the future when we develop the clean air policy under the Clean Air Act, unless we have large-scale carbonisation of coal. What the 130 Paymaster-General did not tell us was what he was going to do with the gas that comes out of the carbonisation process. He also spoke about using imported liquid methane, and we are, of course, taking methane now from some of our mines. The right hon. Gentleman also spoke of underground gasification, and I suppose that as we develop our oil refineries here— and this is one point which I want to make in another connection in a moment— to provide for the 50 per cent. increase in our oil needs about which the right hon. Gentleman spoke, we shall have a lot of tail-end gas from the oil refineries, which I suppose can be fed into some kind of gas grid.
With this great increase of gas on his plate, so to speak, the Paymaster-General seems to have no idea at all of what to do with it; but with an intelligent carbonisation policy that gas could be used for all kinds of industrial purposes in place of coal. My own view is that we shall get a far greater coal saving by this carbonisation policy over the next ten years than we might get from the atomic energy programme. That is a matter of speculation, and I may be right or I may be wrong, but in any case I am sure that we should save many millions of tons of coal if this carbonisation policy were developed intelligently and on a big scale.
There are one or two questions I want to put to the Paymaster-General, because not only did he give us no idea what he was going to do with the gas he was to produce, but the whole policy which he outlined so well this afternoon depends upon a purely speculative factor, and that factor is steel.
It seems to me that we cannot talk about electrifying our railways and the modernisation of our railway system, going on, as the right hon. Gentleman said, with an investment programme in coal production, with the development of atomic power stations, with the building of oil tankers to bring us more oil, with the building of oil storage tanks, the building of a harbour, possibly at Milford Haven, to take the large tankers which are to be built throughout the world, the building of a dry dock, which we still have not got to accommodate these large tankers, and all the rest of it, without realising that all these things add up to a steel programme which, I am confident, is greatly in excess of the steel production of this country.
131 The right hon. Gentleman said nothing at all about how this problem is to be dealt with, but it is a very important problem. Now that steel has come under the control of the right hon. Gentleman's Department, it seems to me that before we go any further with our discussions about the atomic energy programme or anything else, we ought to have a White Paper on steel to tell us precisely what the steel situation is, as my right hon. Friend the Member for Blyth (Mr. Robens) said this afternoon.
I want to put another question in this connection about the atomic energy programme itself. It seems to me that if we are to be short of steel for all the plans and projects that are in mind we have to make some choices. If we cannot do everything, something must be left out. One of the greatest overall present needs in our economy is for more and more exports. Our whole economy depends on that. It has been said in this debate, and is, of course, perfectly true, that one of the things that we should be exporting is atomic power stations. We are in first, and this is the kind of thing which we can develop throughout the world.
If we can sell atomic power stations to other countries, and particularly to the under-developed countries, we shall do good not only to other people but to ourselves, but if because of shortage of steel we have to hold back the export of those power stations in order to develop our own atomic energy programme, I believe— and I say this with a great deal of diffidence— that we shall be making a profound mistake. We ought to give a high priority not only to the development of atomic power stations for export but to the development of other engineering products, particularly those of heavy engineering.
If our steel production programme is such that we cannot take in all these things then, in the list of priorities, I would put the export of atomic power stations pretty high. That may mean that we have to cut back our own atomic energy programme here. We should take that into consideration. After all, the saving in coal— although to use the word "saving" in this connection is not altogether correct— that we expect to get from the atomic energy programme over 132 the next ten years is only 18 million tons. We can get a saving of 6 million tons with a fuel inspectorate going round the country compelling, as the hon. Member for Kidderminster (Mr. Nabarro) said, factory owners and employers to use fuel-saving devices in their factories. We can also get fuel saving fairly easily from a big carbonisation programme.
For the reasons given by the Paymaster-General, I fully support this great expenditure on the atomic energy programme. We have got in first, we have the job going, and we should develop it not only because it will save coal, but for psychological and prestige reasons and the rest; but if we have to make a choice, we must choose exports. I hope that the atomic energy programme is not being considered in isolation but in relation to our export drive, bearing in mind that we should not cripple the export of power stations and other heavy electrical generating gear of all kinds in order to stick tightly to this programme of internal energy development laid down in successive White Papers.
I was in South America recently and went into the big power station at Montevideo, originally equipped by Metropolitan-Vickers. It has been doubled in size — but doubled in size by Brown Boveri, of Switzerland. That is only one example among far too many. It appears that we are being cut out in engineering exports, and we might regain that trade by developing the export of atomic power stations as much as we possibly can.
I hope that we can have a White Paper, or some official explanation of the steel situation, on the production prospects over the next few years, the likely demand for steel for all kinds of uses, particularly those associated with these giant programmes we have in mind for all kinds of internal purposes— a complete statement of steel production, development and prospects. We want that, first of all, so that we can understand just what the steel situation is, and how it might limit us in the activities in which we are engaged.
At the same time, I also hope that we can have an assurance that these problems of making a choice and of deciding just on what to concentrate in the production line is having the full consideration of the Government; that we are not treating those subjects in 133 isolation from each other, but are trying to get an overall picture of our resources and needs, and of how those needs are to be met.
The Paymaster-General's statement, excellent though it was, fell down on three grounds. First, he did not tell us how he will develop the carbonisation programme, which I consider to be so important. Secondly, he did not tell us how he is to find the steel for all the projects under consideration. Thirdly, he did not tell us how he will deal with the supply of oil which he contemplates. He told us that, for fuel purposes, he expects the supply of oil to be increased by 50 per cent. over the next ten years.
We should like to know whether that would be crude oil coming here to be refined, or whether it would be fuel oil, imported as such to be used in industry. If it is to come in as crude oil to be refined, where are we going to get the steel to build the extra oil refineries over the next ten years? What are we going to do with the products that we get from the crude oil, apart from the fuel oil which is apparently to be used in industry on this expanding scale? Shall we further develop the petrol-chemicals industry in order to use the other materials that come out of the oil refining processes?
Have all these matters been considered, or are we just talking loosely about increasing coal production here, gas production there, atomic energy development somewhere else, and increasing the use of oil and so on, each item being considered in isolation, with no real overall plan and with no indication of the summing up of our steel resources upon which so much depends and which is the crucial issue in all these discussions? If we have not got the steel, all these things fall down. We ought to have a White Paper or some authoratitive statement on steel before we consider these matters any further.
§ 8.36 p.m.
§ Mr. Hector Hughes (Aberdeen, North)
I welcome the use of nuclear energy for peaceful purposes, as a means of increasing human happiness. I say that at the outset because I intend to engage in some criticism of the two documents upon which this debate is based.
I want to deal with an aspect of Britain's power resources which, I think, 134 has not been adequately dealt with— it certainly has not been stressed— in the debate today. I refer to the dangers inherent in the exploitation of nuclear energy not only for the workers in that industry, but also for all other citizens. We are all familiar with the dangers which are from day to day and from night to night incurred by the gallant men who go down into the coal mines and hew coal. We are all familiar with the dangers incurred by workers in the oil industry and in various other aspects of Britain's power resources, but nothing is said in either of these documents about the dangers which are inherent in working with nuclear energy.
I have read carefully both of these documents, one "A Programme of Nuclear Power", published in February, 1955, and the other "Capital Investment in the Coal, Gas and Electricity Industries", published this month. In my submission, neither of them deals adequately with the dangers to which I have referred. They both steer unobtrusively away from those dangers, yet those dangers are very great and should have been stressed in both of these documents. These omissions are remarkable and are quite unjustifiable. Indeed, the Minister made no reference to them, nor did he attempt to justify the omissions.
The former of these two documents, in page 8, says:The history of the development of nuclear energy has made everyone aware of its destructive possibilities and it would be natural to ask whether there were any special dangers associated with nuclear power installations.That shows that those dangers were present to the mind of the draftsman of the document but, as I have said, he steered unobtrusively and quietly away from them.
Everyone is not aware of the history of the development of nuclear energy. Nuclear energy is a comparatively new power. Who is aware of the history of it? Scientists and other people are conversant with those investigations, developments and inventions, but the ordinary people are not. When a document is drafted as an exposition of the uses and possible developments of nuclear energy, surely that is one thing which should have been dealt with adequately in the document. It has not been dealt with.
Nor, indeed, is there any attempt to adumbrate what the protective measures 135 are which may be taken against these dangers. There is not a word about it. The document merely says:The main hazards in a nuclear power station are caused by the concentration of radio-active materials.What are the hazards? There is not a word about them. What are the protections which the draftsman envisages against those hazards? There is not a word about those either.
The document goes on:The disposal of radioactive waste products should not present a major difficulty.This incomplete document does not state the full facts and no reason is given for it not stating the full facts.
There are some questions to which I should like the Minister to address his mind. I will put them specifically in an interrogative form, so that they will be easy to deal with. First, what are the destructive possibilities referred to? Secondly, what are the special dangers? Thirdly, what are the main hazards? Fourthly, what damage, disease and injury will they bring? Fifthly, what protection can science provide against these horrors? Sixthly, what steps are being taken to provide this protection and by whom?
The document says, on this, that… great efforts are being made to determine the most economical methods …What are these efforts? What are these methods? How far are they being effective? How far are they advanced?
The document goes on, unconvincingly, to say:Her Majesty's Government have always been in favour of the greatest possible international co-operation in the peaceful uses of nuclear energy, …Her Majesty's Government have a very strange way of showing their willingness to come to international agreement on that subject. There is not a partical of evidence of this; none is adduced. What is being done towards bringing about international agreement? Why are there no urgent meetings of the heads of Governments to discuss this international problem? In particular, what are the British Government themselves doing in this field?
This matter is most urgent for the British people, because it is well known that nuclear energy can produce strontium 136 90. This can cause bone cancer, also leukaemia, a type of cancer of the blood, diseases of the reproductive organs and other present or delayed action damage not only in our own generation but in generations yet to come. Scientists have said quite recently that even low doses are hazardous to human life.
It may be asked how this radioactive strontium 90 is likely to reach humans and other animals. The answer is perhaps not so well known. There are at least three ways in which it can reach humans. One is by effluent, a second is by air contamination and a third is by fall-out from bomb tests.
This radioactive strontium 90 may come by effluent from nuclear power stations. There have been examples— I will cite one— of biological contamination through river waters. For instance, the Columbia River, below Hanford power station, in the United States of America, has been found to contain radioactive elements in excess of the background. I do not want to exaggerate or to he alarmist and, therefore, I will say that it is fair to add that so far no biological damage has been traced to the low levels of radiation in that particular source. The risk, however, is present and this is the type of thing which should have been dealt with in the White Paper, but there is not one word about it.
These dangers can reach us in our food arid without our knowledge. A fatal dose may be within any worker. If a station of this kind has a river near it, there may be a leakage from it. What steps will be taken to protect not only the workers, but also the citizens of the neighbourhood? If they are infected, the contamination may spread to other parts of these islands.
I am not a scientist myself, except, perhaps, in the science of law, but I have taken the trouble to read a little bit about this. I notice that the Atomic Scientists' Association said only the other day:Of greater import, however, is the damage which may result to the present generation, mainly from one radioactive substance— strontium 90. This substance enters into our food, chiefly in vegetables and dairy products and it accumulates in the human body in the bones where it remains for a long time.
§ Mr. C. R. Hobson
I am following my hon. and learned Friend's remarks and I appreciate the dangers from radiation, but 137 I am wondering whether my hon. and learned Friend is aware that for years many power stations, through their cooling towers, have used chlorine gas at very high pressure and that a leak could poison a whole neighbourhood? Power stations are fraught with physical dangers of this sort. Does my hon. and learned Friend think that the danger to which he is drawing attention is any greater than the danger of a chlorine leak in a power station?
§ The Parliamentary Secretary to the Ministry of Power (Mr. David Renton)
May I supplement what the hon. Member for Keighley (Mr. Hobson) has just said by pointing out to his hon. and learned Friend the danger of sulphur fumes, which come often, I am afraid, in large quantities, also from power stations?
§ Mr. Hughes
The point I am making is that these two documents set out to explain to the public, and in particular to Parliament, the situation concerning Britain's industrial resources, especially her resources of nuclear power.
I am pointing out that these documents should have been complete. They are not complete. The quotation which I made a little earlier states:The history of the development of nuclear energy has made everyone aware of its destructive possibilities and it would be natural to ask whether there were any special dangers associated with nuclear power installations.There are such special dangers. No reason was advanced by the Minister, in opening the debate, to justify these omissions from documents which purport to be complete and exhaustive expositions of Britain's industrial resources. In the document called, "A Programme for Nuclear Power" there is not a word about protective measures and about the dangers.
It is up to the Government spokesman who replies to the debate to answer my specific questions on these points.
§ 8.51 p.m.
§ Mr. Emrys Hughes (South Ayrshire)
I want only to make two very short points. I am not appalled, as was the hon. Member for Pollok (Mr. George), at the fact that £3,000 million are to be spent over a period of ten to fifteen years on developing the power resources of this country. I read recently in the Economist that £4,750 million which had been spent on the rearmament programme had been 138 spent on obsolete weapons and paraphernalia and all that money had now gone down the drain." The £3,000 million to be spent on our power resources are spread over ten to fifteen years and represent only two years' expenditure on a rearmament programme for weapons and installations which are already obsolete and out-of-date and on which the nation has had no return whatsoever.
I represent a constituency where there has been considerable expenditure on the development of the power station at Barony pithead at Auchinleck, which will be a useful source of energy for the development of electricity for the South-West of Scotland. One of the ideas current about the power station is that it will be able to burn peat. Has the Minister's Department gone into the question of how far peat can be used as a fuel in new power stations? There is a very active society in Scotland which is interested in the production of peat and which has argued in very great detail that a vast area of Scottish peat bogs could be reclaimed for agriculture if the peat were removed and could be used in these power stations. I know that the hon. Member for Pollok disagrees with me, because we went round the Barony power station together.
I ask the Minister to give the utmost consideration to the arguments put forward on the possibility of a very large area of peat bog in Scotland being used to supply peat for use in power stations. I am not a scientist or a fuel expert, but we Scottish Members receive a great deal of information from people who are informed on these matters and I should be very glad if the Minister dealt with the point.
As for coal, I remember a remark made in a letter sent to me by Mr. Bernard Shaw when I stood as a candidate for Parliament. He was not enthusiastic about the continuance of the coal mining industry. He said that coal mining was not an industry, but was an atrocity. If we can secure other sources of fuel to prevent men working so long in the darkness of the earth we should further these developments.
I welcomed the tone of the speeches made in this debate, especially the one made by the hon. Member for Pollok 139 when he looked forward to a great expansion of State enterprise and State industry. I hope that that will be the purpose of the Ministry and that it will look forward to the development of power stations and power industry which will be under national control and be used for the national interest.
§ 8.56 p.m.
§ Mr. Harold Neal (Bolsover)
There is always some pleasure to be derived in the discovery of disagreement with one's political enemies, but the debate today has not provided us with much satisfaction on that score. Under the happily chosen title of "Britain's Power Resources", the discussion has ranged widely and there has been remarkable unanimity in the Committee.
There have been some excellent speeches, notably from my right hon. Friend the Member for Blyth (Mr. Robens), my hon. Friend the Member for Normanton (Mr. A. Roberts) and, in particular, from the hon. Member for Walthamstow, East (Mr. J. Harvey). The Minister, too, delivered an excellent parliamentary utterance with a customary ease which I envied very much. The right hon. Gentleman set himself a number of mathematical problems and proceeded to solve them as he went along. However, they did not reveal any drastic division between the Opposition and the Government on the subject of power resources.
It should be a good augury for the future, because generally what this House of Commons finds itself in agreement upon the country executes with distinction and skill. I have often heard it said of a debate here that it was the most important one of the Session. At the risk of uttering a commonplace, I say that the subject we have been discussing today has no comparison in its importance for the prosperity and the welfare of the country.
Jack London, in one of his books, put into the mouth of a character these words:Power. We have conned the word over until our minds are all a-tingle with it.I wish that were the mind of the British people today, because the more we talk about this subject and the more we think about it, the better it will be for everybody concerned in the country. The 140 White Paper issued in 1955 stated very truly:Our civilization is based on power. Improved living standards both in advanced industrial countries like our own and in the vast underdeveloped countries overseas can only come about through the increased use of power.A simple illustration of that declaration is found in our own history. One is struck by the fact that for many centuries our standard of living did not advance very rapidly. Then suddenly there was an inflection in the curve about 200 years ago, and from that point our standard of living made a marked advance.
To try to pin down that date will lead one to the conclusion that the turning point was man's discovery that he could reinforce his energies with the use of other forms of energy, coal and steam power. I believe that we are at a similar stage today. The wisdom with which we use our old and new power resources will largely determine the level of our material enjoyment for many years to come. I do not scoff at the Lord Privy Seal's prophecy of doubling our standard of living in twenty-five years; I believe that with the wise use of our new and old power resources and the cumulative increase in our productive capacity which is certain to follow, that prophecy can be fulfilled.
Not only will our success depend upon our investment in the new resources; there must be no risky abandonment of those resources which once enabled us to become the leading industrial power in the world. There is an old saying in my part of the country:Don't throw away your dirty water until you are sure of your clean.We must be sure that there is no rundown in the capacity of our conventional resources until the new forms of energy can adequately take their place. That is why the White Paper is correct in regarding any investment programme as provisional. It emphasises the point when it says that it will be altered in many ways in the course of time. A ten-year investment programme for coal and for atomic energy must be elastic enough to reduce the former as the rising needs of the nation are met economically by the latter. Some unexpected success or failure may require us to revise our ideas not once every ten years, but perhaps once every two or three years.
141 We have already found it necessary to revise the coal plan, issued only a few years ago, and now the atomic energy programme, issued in 1955, has had to be revised, but our broad approach to this problem of power remains a twofold one. First, we must stop the unnecessary waste of our available resources and, secondly, we must increase conventional and new forms of energy in their right proportion to meet our industrial and domestic needs. In reviewing the capital expenditure programme of the publicly-owned sector of our economy, the White Paper commences with a description of the development undertaken in the Coal Board's ten-year plan—" Investing in Coal ".
Much has been said about the coal industry today. My right hon. Friend the Member for Blyth paid a warm tribute to the industry's recent achievement. Like him, I have what might be regarded as a vested interest, in that I represent a mining constituency, and I cannot he expected to apologise for attempting to underline some of the statesmanlike utterances that he made about the industry. It has entered upon a phase of prosperity which we all hope will not be temporary in character. The output figures for the week ending 13th April— of 4.598.800 tons of deep-mined coal and 268.000 tons of opencast coal— represented a splendid achievement.
The other day I was asked by a highly-placed official in the coal industry to what I ascribed the recent increases in coal output. I do not believe that it is possible for anybody to put his finger upon a given feature of the industry and say, "This is responsible for the increased output of coal". There have been many contributing factors. First, there have been the good relations existing in the industry. Happily, there are still some pillars of sanity in the National Union of Mineworkers, and they have co-operated well with the Coal Board in obtaining these increases in output. Secondly, there has been a slight increase of manpower. This means that the average age is tending to fall. That aspect of the matter had been giving us reason for perturbation for some years past. Thirdly, the effects of reorganisation since vesting day are now beginning to be felt.
As my right hon. Friend said a few days ago, these figures do not bear out 142 the opinion held in some quarters that we are a lazy nation. Not only should we stop this carping criticism, but we should abandon our injurious modesty about the coal industry. Let us say aloud that the British coalminer produces more coal than any of his European counterparts. This success has been achieved in spite of the handicap of unequal geological conditions. We have mechanised thin seams upon which our grandfathers would have scorned to invest either muscle or money and created a mammoth production. Were any further consolation needed, we can point to the fact that we still have the cheapest coal in Western Europe.
I should be insincere were I not freely to acknowledge that, amid all the success which I have mentioned, a "red light" is showing. I refer to the growing proportion of small coal in our present output. As the Minister indicated, intensive mechanisation and the use of explosives have aggravated this problem. I am sure that the colossal amount of slack in the country must be a matter of concern both to the Minister and to the Coal Board. At some time we may think of extending the briquetting industry to use up some of this small coal. The calorific value of small coal is the same in proportion to its size as that of large coal. I am all in favour of efficient methods by which it may be used by industry. I join in the tributes which have been paid to the Central Electricity Authority on the adaptation of its firing apparatus to the use of small coal. But, as the number of coal fired generating stations declines, it will be increasingly difficult to find a market for this inferior small coal.
The present day miner knows nothing of the experiences shared by some of my hon. Friends of having to load coal with a fork. In those days millions of tons of coal were thrown into the waste every year, which was a loss to the consumer market and a source of fire danger underground. I beg the Coal Board to seek the co-operation of the industry in an attempt to produce more round coal.
When did the Minister of Power last go down a pit? He might bring some of his great industrial experience to bear on this problem. I have heard of the Paymaster-General and the Parliamentary Secretary donning helmets and going down pits in Yorkshire and the Midlands 143 to help to increase output, and I see no reason why the "Commander-in-Chief" should not go to see the men in the "front line".
§ Mr. Neal
The Minister might find a solution to this problem created by the excessive amount of small coal, we must avoid the fantastic situation of exchanging small coal for large coal with our competitors on the Continent.
I wish to say a word about fuel efficiency. No one has done more to encourage the efficient use of solid fuels in this country than my right hon. Friend the Member for Blyth. As I am in a complimentary mood, I might also refer to the hon. Member for Kidderminster (Mr. Nabarro) in that connection. We should learn from our past errors. We have been so prodigal in the use of coal that we were unable to take advantage of the export market at the end of the war, when there was a coal hunger in Europe. A few years ago, when my right hon. Friend the Member for Blyth suggested imposing sanctions against inefficient industrialists who were wasting coal, there were howls of protest from hon. Members opposite.
The plain fact is that fuel consumption in industry represents such a small proportion of the cost of the manufactured article that the inefficient manufacturer can continue to use inefficient apparatus in the sure knowledge that he can pass on the extra cost to the consumer. I have heard the hon. Member for Kidderminster say many times what he repeated today, that one bad stoker can waste the output of one good miner. It might interest the Committee to learn what is being done under the Ministry's assisted schemes in this matter. Perhaps the Parliamentary Secretary might bear that in mind when he replies.
I would say a word about coal exports. At the present time they are of little account, but there is a possibility that we may yet export coal in considerable volume. If our nuclear programme advances more rapidly than those of our Continental neighbours we shall certainly have surplus coal for export. It is a long-term possibility, but it should not be left entirely out of account by the Minister and his colleagues.
144 Page 4, paragraph 5, of the White Paper says that the capital expenditure of the coal industry for 1956 was calculated to be £107 million, although actually only £96 million was used. What is the explanation of the shortfall? Was it a shortage of steel, lack of technicians or physical difficulties of development? Perhaps we might hear the reason from the Parliamentary Secretary. It is significant that the figure fell £11 million below the estimated amount. That could very easily mean a loss of capacity in the industry in 1957.
The White Paper wisely embraces the coal, gas and electricity industries. Capital expenditure in these industries must never again be considered separately and apart from each other. Now that the large developments have taken place and the grid link-ups have been completed, capital expenditure must be related not only to demand but to the impact of cheaper forms of secondary fuel. There is no mention of oil in the White Paper. There has been a tendency in the past to attempt to bridge the gap between coal production and consumption by importing oil. I hope that the omission means that the Government are intent upon bridging the gap with coal and atomic energy.
The speech of the hon. Member for Walthamstow, East was very interesting because of his suggestion that we should use our disused coal mines for the storage of large quantities of oil. He either did not know or had forgotten that the roof of a disused coal mine caves in, and that in any case it would be difficult to seal up very large quantities of oil.
§ Mr. J. Harvey
I did not refer to coal mines in my speech. I had particularly in mind the tin mines of Cornwall, which I understand might be useful. I said "mines", not "coal mines".
§ Mr. Neal
Even the roof of a tin mine would cave in in the same way as that of a coal mine, unless my mining experience is at fault.
I hope that there is no intention by the Government that the gap must be bridged by oil. One favourable way in which we can use oil as a primary fuel is the dieselisation of our railways, which offers a splendid opportunity of saving fuel. Branch lines are especially suited for this plan. A diesel engine has many advantages over the steam locomotive, 145 especially when stand-by losses are considered. One ton of diesel oil will replace 9½ tons of coal. The reason is that the steam locomotive has fire raging in its belly while standing in a station or in sidings, but a diesel engine can be switched off in those circumstances and is more economical as a result. We might take a lesson from the United States of America, which has substantially increased its transport in that way.
Only about three years ago we heard a Tory Minister of Fuel and Power telling the House of the probability of augmenting our power resources by the import of liquified gas. I little thought that after the experience of technicians who have been engaging their attention on this problem we should have the Paymaster-General return to that subject and offer it to the Committee this afternoon. We cannot look forward with any keen expectancy to the process ever being accomplished. A ship carrying liquified gas can carry only 50 per cent. of the British thermal units carried by a tanker of the same size conveying oil. Furthermore, there are engineering difficulties which have not been overcome in reducing the temperature to the required level. As happened two or three years ago, the suggestion may have the effect of appeasing the Committee when there is concern about fuel resources.
There have been speculations in the Press recently about piping gas from the oilfields of the Middle East to the United Kingdom. Anyone who has been to the Middle East and seen the enormous flares burning day and night, wasting energy, must be entranced at the prospect of such an achievement, but there are political difficulties which are even greater than the technical difficulties. We should be wise to concentrate on developing our own primary and secondary fuels instead.
It must be a pleasure to the Secretary of State for Scotland to be associated with this White Paper because of its reference to investment in hydro-electricity. Paragraphs 21 and 22 state that the expenditure is expected to be £20 million in 1957. That is very heartening. In this country we were very late in adopting this method of generating electricity. Small countries like Norway, with fast flowing rivers, began on such projects before we did. Brazil, with its wonderful watershed at a high level, have 146 been able to develop hydro-electric plants much in advance of our own.
We have achieved a great deal in the last thirteen years. Our success has been made possible because of the co-operation of the Scots with the North of Scotland Hydro-Electric Board. My experience when I was at the Ministry of Fuel and Power was that landowners, crofters and farmers welcomed and facilitated this development. I hope that experience will be repeated in relation to the new scheme for North Wales. I do not think there is much else we can do in the expansion of the hydro-electric industry in Scotland or Wales. I believe that there is some good yet to be done in extending transmission and distribution. The time may come when Scots will export electricity below the Border, but I do not think that it will be within the next few years.
§ Mr. James Griffiths (Llanelly)
My hon. Friend may add that some day someone will have the courage and the imagination to go on with the Severn Barrage.
§ Mr. Neal
I am afraid that my time is getting too short to become too international.
I want finally to refer to the programme of the Central Electricity Authority, with special reference to the revised nuclear programme in the Appendix of the White Paper. I join with my hon. Friend the Member for South Ayrshire (Mr. Emrys Hughes) in deploring the perturbation about the size of this programme, about the magnitude of the sum of money. I thank him for reminding the Committee that this sum of £3,000 million represents only two years of our rearmament programme and that we ought not to be staggered by the amount it is proposed to invest in this good work.
The programme envisages the most startling industrial development since the discovery of the steam engine, and if it is completed by 1965 we shall be producing nuclear output capacity of 6,000 megawatts, equivalent to 18 million tons of coal. It offers a prospect that at some time men will not be troglodytes working underground doing dangerous work to reinforce the energies of man. What an immense programme this is. It has been made possible only because we lead the world in the peaceful uses of atomic energy.
147 But how modest we Britons are. If Britannia no longer rules the waves, it is a certain fact that she rules the isotopes and the reactors. I believe that the names of Rutherford, Cockroft and Hinton will rank with great names like Newton, Faraday and Einstein in historic scientific achievement.
It is a surprising reflection that the Ridley Committee, which has been spoken of so much this afternoon, five years ago stated that it could not venture to make calculations about the capacity of atomic energy, but now we are calculating on producing 18 million tons of coal equivalent in the next eight years. It would be imprudent for anybody to attempt to criticise the investment totals. Without the knowledge which is at the disposal of the Government it is impossible to question the estimates given in the White Paper. They may be too large, they may be too small. That is one of those speculations which any Government would have to make at this time, almost regardless of the financial consequences.
We on the Opposition side can say only that we wish the Government well in this great project, because it means so much to the future of our country. Here, let me add a warning. We must avoid the appearance of creating the impression that the full impact of the atomic age will be here in a year or two. It is not just around the corner. Furthermore— and here I speak for myself only— we must avoid becoming too deeply entangled in treaties on the Continent. Perhaps it is a rather selfish view, but I think that we have much more to gain commercially— [Interruption]— the Parliamentary Secretary says that there are lots of treaties on the Continent. He knows the kind of treaty I mean.
§ Mr. Renton
I said that the hon. Gentleman's party, when in power, got entangled with lots of treaties on the Continent, including bulk buying agreements.
§ Mr. Neal
We were never entangled in a treaty like the mess at Suez.
I was saying that this is my point of view, whether shared by my party or not. We can derive more commercial advantage by selling power reactors than by providing know-how. At any rate, we on 148 this side of the Committee believe that what happens at Calder Hall, at Bradwell and Hunterston is much more important than what might happen at Christmas Island in the Pacific.
Atomic energy is as inspiring as it is terrifying. If it is wisely used, the potential good could outweigh the potential evil. We may be standing now at the golden gateway of a new dawn of expansion in our economy and in our influence in world affairs. Who knows? The verdict of any impartial observer as he looks at our industries today must be that our power resources are in good shape. These industries have succeeded very largely because they have been a collective effort, and it is for these reasons that we join with the Government in commending this programme to the Committee. We believe in doing so that it can mean so much to the material well-being of the nation.
§ 9.26 p.m.
§ The Parliamentary Secretary to the Ministry of Power (Mr. David Renton)
The hon. Member for Bolsover (Mr. Neal) has drawn attention to the remarkable unanimity which has been displayed in this important debate. May I say, on behalf of my right hon. Friend the Paymaster-General and my noble Friend the Minister of Power, how gratifying it is for us to know that these very important matters of the nation's power policies have the broad support of the Opposition as well as of the supporters of Her Majesty's Government?
The hon. Member for Bolsover, like so many hon. Gentlemen here today, asked me a number of detailed questions, and I think it would be more useful for me to try to reply to them in detail rather than discuss all over again the broader issues which have been so well ventilated. May I, first, try to answer three specific points which the hon. Gentleman raised? He drew attention to the point made by my right hon. Friend the Paymaster-General in his opening speech in the, debate, when he asked what was to happen to the small coals and also the lower grade industrial coals when the nuclear power programme gets under way.
My right hon. Friend pointed out that, for ten years, at any rate, there is not the slightest question of there being a surplus of such coals. As to the general question of the future of the coal mining 149 industry, to which the hon. Member for Normanton (Mr. A. Roberts) and others have referred, I should like to say that even in forty years' time— that is to say, even when young men now going into the industry will still be at work in it— coal will still be our principal source of energy, on present indications. I think it is right that we should put that on record and stress it, because we shall certainly be dependent on coal for a very long time to come.
The hon. Member for Bolsover also asked me how much had been spent— if that is the right word; probably a better word is lent— under the Government's fuel efficiency loan scheme so far. The answer, in round figures, is £3 million. I have not got further details, but I can give them to the hon. Gentleman on some other occasion. He also asked why the White Paper shows a slight shortfall in capital investment in coal, and the answer is that the National Coal Board last year—
§ Mr. Renton
That is so; 10 per cent. The Coal Board gave two reasons. The first was that its reconstruction department, which had been set up specially to carry out the reconstruction programme, had not been properly and fully manned up, and had not got under way. That is one reason. The other reason was that the excessively bad weather of last summer prevented the beginning of new pit sinkings and other surface works. That is the explanation.
I turn to the speech of the right hon. Gentleman the Member for Blyth (Mr. Robens). While thanking him for the general support which he gave to the bold commitment of the nuclear power station programme, and while appreciating all his points, which, if I may say so, were valuable to make and which I shall try to answer so far as I can, I must nevertheless take issue with him on what he said about petrol rationing. Quite frankly. I was very surprised that he said it. I thought that the right hon. Gentleman with his years of parliamentary experience, knew better than to swallow wholesale all the rumours and tittle tattle that go on in the Press about such a thing.
It was quite untrue to say, as he said, that every garage was breaking the law. It was equally untrue to say that the Gov- 150 ernment had decided, before the Jordan trouble, to abolish petrol rationing. There is not the slightest evidence of that, except in newspaper rumours. Really, he should have known better. The truth is that the garages up and down the country, generally speaking, have been very conscientious about this petrol rationing scheme— [Laughter.] I am content about the laughter from those benches, because hon. Members opposite are on a very weak point here.
Bearing in mind that no rationing scheme, so far as I know, and within the experience of this House, has ever been perfect, and that this was a very quickly improvised scheme, and never pretended to give more than rough justice— it is gratifying to know that the scheme has saved the amount of petrol which needed to be saved. Naturally, we are anxious to end the rationing as soon as we can but, as my right hon. Friend has pointed out, there is no question of doing that until there is assurance of adequate supplies.
The right hon. Gentleman and the hon. Member for Hillsborough (Mr. G. Darling) asked about a matter which is slightly extraneous to the general content of the debate, so perhaps I may dispose of it now. They asked about the availability of steel. In 1956, 20¾ million ingot tons of steel were produced, and last year's estimate of the amount of steel needed by 1962 was over 28 million ingot tons.
The future forecast and target may have to be revised in the light of the various developments which have been taking place in recent months—not only the nuclear power station programme, which, in itself, will not take very much extra steel but various other commitments which have been mentioned by hon. Members today. There is the tanker building especially for ocean-going tankers, there are oil pipelines, refineries, and so on.
As was announced a few weeks ago, the Iron and Steel Board has been asked to submit to my noble Friend a report on the steel industry's development programme up to 1962, and I understand that that report is now at its final draft stage and that my noble Friend will receive it before long. I can assure the Committee, however, that the need for steel for the various power purposes, which we have in mind has not escaped 151 my noble Friend's attention, and the only point of detail I would make is that it may well be that we shall find that, if there is need for concentration on one particular element rather than another, it is on heavy plate and plate sections.
§ Mr. Renton
I am not able to say that at this moment.
The right hon. Member for Blyth asked whether there would be a sufficient number of technicians for the nuclear power programme. It is impossible to say "yes" or "no" to that. All that we can say is that the Minister of Education, the Central Electricity Authority, the Atomic Energy Authority and the various engineering companies which are producing the plan for the power station programme are extremely conscious of the need for technicians and are doing their best to have them trained. The right hon. Gentleman will be aware of the Government's technical education programme which should make a contribution to the matter.
The right hon. Gentleman suggested— we have often heard it from various sources and it has been mentioned by other Members during the debate— that we should have what they choose to term a national fuel and power policy. We never quite understand what is precisely meant by that in terms of definition. All that I can say is this. Surely it is clear enough and abundantly plain from today's debate that we have got a national fuel and power policy. My right hon. Friend has more than outlined it today. He has filled in a great deal of the detail.
§ Mr. Robens indicated dissent.
§ Mr. Renton
The right hon. Gentleman shakes his head. May I remind him of this? The first essential of a national policy is to estimate future demand. But we must bear in mind what my right hon. Friend the Member for Woodford (Sir W. Churchill) said— that it is a good thing to look ahead, but a bad thing to look further ahead than you can see. Mr. Gladstone made that mistake in 1866, when coal production was about 100 million tons a year. He estimated that by a 3½ per cent. increase at a compound rate we should, by 1961, be using no less 152 than 2,607 million tons of coal— a fantastic mistake due to looking further ahead than one can see. We know that by 1961 we may be using round about 280 million tons.
At any rate, my right hon. Friend today put forward with facts and figures, and estimates to support it, a reasonable target for the years to the end of 1965. He said that we should be using about 50 million tons more coal equivalent than we did in 1955. So there is the target, at any rate, of a national fuel and power policy, and that is what we have to take to begin with.
The next point is: what is to be the main means of supplying the demand which that target indicates? The Government have a national policy for the coal industry, an investment plan of over £1,000 million over ten years, and I should have thought that was a vital part of any national fuel and power plan.
Then we have a nuclear power programme to take advantage of the progress which has been made by scientists, in order that we may be in the forefront of technical advance in his highly competitive world of today. That is the second method of meeting the demand. In addition, one is familiar with various miscellaneous sources of supply, some of which were mentioned by my right hon. Friend.
Finally, we have the need, whether we like it or not, to fill the gap with oil, and on that my right hon. Friend was quite specific. He said that looking at it carefully, and with a view to the arithmetic of the matter, we should probably need 50 per cent. more oil in 1965 than we needed in 1955. If that is not a national fuel and power policy in outline, I should be glad if somebody would tell me what is.
§ Mr. Robens
With the help of the British Productivity Council, all that the Minister has indicated is the planning of the extensions of the industry. That is not a fuel and power policy. That is what any wise business would do, whether privately or publicly owned; it would look ahead and ascertain the future requirements and plan for them.
May I read two or three sentences to tell him what a fuel and power policy is in the terms of the Productivity Council, or can I leave it to him to look at page 153 6 of that document, which he really ought to know by heart? I am quite prepared to read it to him.
§ Mr. Renton
This document was brought out some three years ago and dealt with a vast number of matters. Frankly, I should have thought that we have the broad outline of a national fuel and power policy—
§ Mr. Renton
— and that what the right hon. Gentleman is really trying to tempt us to do is to enter into a vast amount of detail, to tie ourselves down in a rigid manner for some time to come to specific details, whereas the essence of the matter, as was pointed out by an hon. Friend of his and by my right hon. Friend the Paymaster-General is that we should be bold enough to change the policy with changing circumstances, as has been done in the nuclear energy programme.
§ Mr. Robens
The hon. and learned Gentleman is confusing planning with policy. What did the Productivity Council state was necessary for a national fuel policy? It said:Its purpose would be to impose a rigid check upon avoidable waste in every usage of heat and power and to bring about such measures of economy as will reduce to the minimum the amout of fuel consumed, without detriment to industry or to the public and national services.That is a policy. What the hon. and learned Gentleman has described is merely an expansion of the fuel and power industry.
§ Mr. Renton
The two sentences which the right hon. Gentleman has read relate not to production, but to use and conservation. That is a matter about which we also have a great deal of policy. I have mentioned that we have a fuel efficiency loan scheme. The right hon. Gentleman must not ignore the various other things which the Government have done in this matter. We grant that fuel conservation is a most vital matter. It is not an easy matter either. Perhaps it would be helpful if I mentioned, first, something about the industrial side of it and, secondly, the domestic side of it.
On the industrial side, there is no doubt about it that very much more has been achieved than on the domestic side. As my hon. Friend the Member for Kidderminster (Mr. Nabarro) asked for 154 various figures on what the National Industrial Fuel Efficiency Service had done, I would mention that in the two years ended 31st March, 1956, N.I.F.E.S. made visits to no fewer than 21,300 factories. At many of those factories it was able to give useful advice without carrying out a detailed and full survey. And up to 31st December, 1956, it made detailed heat and power surveys in no fewer than 1,199 factories. We have no record as to the precise extent to which the recommendations of each of those surveys was carried out, but we understand that, in fact, very considerable savings have been made as a result.
§ Mr. Nabarro
My hon. and learned Friend has put his finger on the very point to which I drew attention in an effort, in a non-controversial sense, to illustrate the weakness of the present N.I.F.E.S. set-up. It is valueless to carry out a large number of surveys, particularly where recommendations are made for the installation of new and more efficient plant, if those recommendations are never implemented. Will he try to get the figures before the next fuel and power debate?
§ Mr. Renton
Quite candidly, that does not add much to what my hon. Friend said in his interesting speech.
The question of industrial fuel saving is largely a financial matter. The Government have provided various financial incentives, not only the fuel efficiency loans scheme but also the investment allowances, and there is a growing consciousness on the part of industrialists that there is no better investment than in fuel saving equipment because, generally speaking, they get their money back so quickly and it is in their own business interests to install such equipment.
I confess, however, that on the domestic front the position is much more difficult. The worst offender is the old-fashioned type of open fireplace, which is probably still the main form of space heating in more than half of our 15 million households. The replacement of these grates by efficient modern appliances would give a 50 per cent. increase in warmth from the same amount of fuel. To put it another way, there would be a one-third reduction in the amount of fuel used to obtain the same heat output.
155 If all the existing houses and all those to be built in the next ten years were fitted with efficient modern appliances, the total saving of solid fuel would be about 5 million tons of coal equivalent. It is worth bearing that figure in mind, because although in relation to our present consumption total of 255 million tons, and also our increasing consumption, it would not solve a very large portion of our problem, it is certainly worth doing. We can hope that the Clean Air Act, as it is implemented, will go some way towards doing this.
I hope that I have dealt with the principal points mentioned by the right hon. Member for Blyth, although not necessarily to his satisfaction, and I will now deal with the points raised by various other hon. Members. My hon. Friend the Member for Kidderminster asked how the various amounts which are to be invested on capital account by the nationalised industries and particularly under the nuclear power programme were to he found, whether by self-financing or by new borrowing. As my hon. Friend knows, that is a matter primarily for the commercial judgment of the boards themselves. Up to the present, there has been a combination of both methods, but it is a matter which is also under consideration by my noble Friend and there is nothing further that I can add at the moment.
§ Mr. Renton
The hon. Member for Keighley (Mr. C. R. Hobson) asked why trolleybuses were being done away with. To some extent, the answer was given by my hon. Friend the Member for Truro (Mr. G. Wilson). This has been done partly by local authorities owning trolleybuses and party by the nationalised industries. It has been done to a great extent to relieve traffic congestion.
§ Mr. Renton
I am glad to be able to tell the hon. Member that the aggravation of the smoke nuisance by the diesel buses which are used to replace the trolleybuses is only a minor aggravation in relation to the total problem. After all, the amount of diesel oil which is used is not enormous in relation to our oil supplies.
156 My right hon. Friend the Member for Pollok (Mr. George), whose speech I was sorry to miss while I was refuelling myself, made various criticisms of the choice of the Hunterston site, in South Scotland. That is a matter which engages the attention of my right hon. Friend the Secretary of State for Scotland more than that of my noble Friend, but both the Secretary of State and my noble Friend recognise the importance of maintaining public confidence in the choosing of suitable sites.
§ Mr. Renton
My right hon. Friend has given me a true version of what my hon. Friend said in my absence. I understand that my hon. Friend objected to the way in which private land had been trampled over, but that and kindred matters are, naturally, among the subjects which are causing my noble Friend to have a special inquiry made and which are giving him special concern in connection with this very great development.
My hon. Friend the Member for Pollok and the hon. Member for West Lothian (Mr. J. Taylor), who has apologised to me for not being able to be present at the close of the debate, both spoke about the Scottish shale industry. The future of that industry is one which has engaged the attention of the House of Commons at least twice during the past 12 months. I cannot add to what has been said from this Dispatch Box on those two previous occasions. As my right hon. Friend said in opening the debate, we cannot possibly afford to ignore the price relationship between one fuel and another when deciding which fuel should be developed.
It must be remembered that, in spite of the fact that Scottish shale oil, like other indigenous oils, has a price advantage through remission of Excise Duty, the industry is carried on at a loss and that cannot go on indefinitely. I understand that my hon. Friend the Member for Pollok suggested that the industry supplied enough derv to meet the needs of Scotland. Have I got that right?
§ Mr. Renton
I understand that, in fact, it produces enough to meet only one-third of even Scotland's transport needs. That 157 is an insignificant contribution from the shale oil industry.
The hon. Member for Keighley questioned me about the policy of going over to oil-fired power stations. He will recollect that that policy was announced in 1955 at a time when it seemed, and the indications were acceptable, that coal production would not increase very much and something had to be done to enable our electricity industry to expand. Contracts were entered into by the Central Electricity Authority on its own account with the oil companies for the supply of oil to the various power stations, most of which were to be dual fired— either by oil or coal. As a result of that policy, only two completely oil-fired stations are in existence. All that I can say is that, as my right hon. Friend indicated, that policy is continuing, to the extent that the contracts must be fulfilled, and that there is no good reason for changing it.
The hon. Member for Hillsborough said something which it was very right for him to say in a debate of this kind, that the gas industry has a most important part to play especially in connection with the clean air policy. We shall need the increased quantities of gas which are produced and also the coke that will go with them.
When we get so enthusiastic about the nuclear energy programme, and when we hear hon. Members speaking of an almost all electric kitchen, and so on, I hope it will not be forgotten that the gas industry also has a vital part to play. We consider that the competition between the gas and the electricity industries, as well as competition between those industries and the oil industry to the extent that it is possible, is healthy and is in the interests of consumers. Certainly, there is no question of the gas industry being other than an expanding one.
The hon. and learned Member for Aberdeen, North (Mr. Hector Hughes) perplexed me somewhat by expressing anxieties which it is not usual for us to hear, about the radioactive nature of nuclear power stations. There is no question of fall-out from those power stations.
§ Mr. Hector Hughes
I made it clear that I was not suggesting there was any fall-out. I merely mentioned it in passing.
§ Mr. Renton
I am glad that the hon. and learned Gentleman has allayed the fears which he created in our minds about the fear in his own mind. Here, I am in the position of the layman since I am no expert on the behaviour of radioactive materials, but we are assured that these nuclear power stations will probably be safer for people to work in than many kinds of industrial factory, and that there is no public danger likely to result from them. At the same time, let us accept that radioactive materials are in themselves extremely dangerous, that we have never yet had a power station working on them, and that we should reserve a modicum of caution about this matter.
§ Mr. Hughes
Why, then, are the stations not being sited in industrial areas? Is it not because there is danger of a leak?
§ Mr. Renton
I do not think that there is any question of the danger of a leak. So far the first three, or perhaps four, stations have been definitely sited far from centres of population, but various factors have to be considered in siting an atomic power station. One of these is an availability of water, another is sufficient area for development. Another is the need to have a very firm subsoil on which to erect the heavy buildings.
§ Mr. Hughes
I am sorry to interrupt again, but has the Minister forgotten the example I gave of the Columbia River, in America?
§ Mr. Renton
No, but I should have to make further inquiries about that before venturing to say something at the Dispatch Box.
The hon. Member for South Ayrshire (Mr. Emrys Hughes) mentioned the desirability of developing peat in Scotland as a useful fuel. The Ministry has been working on this for some time with increasingly hopeful results.
I do not claim to have answered all the many points which have arisen, but I have done my best to answer some of them. In conclusion, may I say that there is no question of our not having a fuel and power policy, one which can be carried out, one which will meet our needs, and one which is within the power of this country to fulfil?
§ Mr. A. Roberts
May I ask the hon. Gentleman whether, when the coal-firing installations are worn out, it is the intention of the Ministry to replace them with nuclear energy?
§ Mr. Renton
As I understand it, there is no question of any of the present coal-fired stations being converted to nuclear energy. There are no proposals of that kind in existence.
Whereupon Motion made, and Question, That the Chairman do report Progress and ask leave to sit again— [Mr. E. Wakefield]— put and agreed to.
§ Committee report Progress; to sit again Tomorrow.
§ Select Committee nominated: — Mr. Ede, Mr. Hugh Fraser, Sir Lancelot Joynson-Hicks, Mr. Roy Jenkins, Mr. Elwyn Jones, Viscount Lambton, Mr. Nigel Nicolson, Sir Leslie Plummer, Mr. Kenneth Robinson, Mr. Simon, Sir Patrick Spens, Sir Spencer Summers, Mr. Turton, and Mr. Younger:—
§ Power to send for persons, papers and records: —
§ Five to be the Quorum.— [Mr. E. Wakefield.]