HC Deb 10 June 1958 vol 589 cc42-4
The Paymaster-General (Mr. Reginald Maudling)

With permission, Mr. Speaker, I should like to make a statement.

The Government have now decided that the statutory control of house coal supplies and prices, which has been in existence ever since the beginning of the war, should be brought to an end at an early date.

The restoration of free competition and freedom for the householder to buy from any merchant should encourage producers and distributors to offer the public the qualities of coal they need at the most competitive prices. With the ending of control, administrative expenditure of nearly £1 million a year will be brought to an end.

In reviewing the question of decontrol, the Government have been materially helped by the Report of the Robson Committee on Coal Distribution Costs, which has been published today and which is now available in the Vote Office.

I would like to take the opportunity of thanking Sir Thomas Robson and his colleagues for a Report which provides detailed and authoritative information about the organisation and economics of coal distribution. The Committee has made a number of recommendations which the Government will consider in consultation with those concerned.

My noble Friend proposes to have immediate consultations with the National Coal Board, the merchants, the Domestic Coal Consumers' Council, and the local authorities to ensure that the transfer from control to free competition is effected smoothly.

The Government have it in mind to end the control about the middle of July. Control of the prices of coke and manufactured fuels would end at the same time.

Mr. Robens

Everyone will welcome the announcement that after nearly twenty years coal rationing is now to end, but we shall have to see what happens, whether the Minister's prophecy, that free competition will deal effectively and properly with prices, comes about. We join in thanking Sir Thomas Robson for the Report and at some stage we shall probably want to discuss it.

Now that the control of house coal supplies and prices is to be discontinued, does that also mean that the prices charged by the Coal Board are now to be settled by the Board and not made under the usual arrangements between the Minister of Power and the Board?

Mr. Maudling

The prices charged by the Coal Board to the merchants will be settled under the same procedure as prices charged by the Coal Board generally; in other words, what is known as the "gentlemen's agreement".

Mr. Robens

Does that not mean that under this new freedom which the Minister is imposing on the industry the Coal Board is to be the prisoner in this matter while the distributors will be entitled to charge what prices they like for the qualities they offer? In view of the shortages of many qualities of coal which are widely in demand, will not the Coal Board probably have to offer coal at prices at which it ought not to offer such coal, while the retail distributors will be able to take advantage of the shortages to ask any prices they like?

Mr. Maudling

The right hon. Gentleman has not observed that, while the Coal Board is a monopoly, the distributors will be subject to keen competition.

Mr. Nabarro

While warmly congratulating my right hon. Friend from this side of the House on his long overdue statement on the end of coal rationing, may I ask whether he can give the House an assurance that the additional supplies of large coal which will be necessary will not mean any resumption of the imports of American coal?

Mr. Maudling

It is certainly not my noble Friend's intention to resume the importation of coal. One of the reasons why this move is possible is that the Coal Board has been successful in checking a decline in the relative proportion of large coal mined. In fact, there has been a slight increase. It is most important that that improvement should be maintained and my noble Friend is confident that it will be maintained.

Mr. Robens

What does the right hon. Gentleman propose to do about the allocation of scarce qualities of coal for the domestic market, since he has now said that the Coal Board will not be a free agent in this matter?

Mr. Maudling

That will remain in the hands of the Coal Board, which will allocate scarce grades and qualities of coal as it considers right. It will make it a condition of contract with the merchants that the coal so delivered by the Board shall be distributed within certain areas, so that the distribution over the country of the various types of coal will remain the responsibility of the Board.

Mr. Blyton

Is the right hon. Gentleman aware that the prices policy and the "gentlemen's agreement" and the relationship of the Minister and the Board have been considered by a Select Committee, which unanimously recommended that the present "gentlemen's agreement" should be abolished and made other recommendations about the Board's future prices policy? Has any consideration been given to the recommendations of that Select Committee?

Mr. Maudling

Yes, Sir. The recommendations of that Select Committee were carefully studied, but so long as the "gentlemen's agreement" remains in being it must apply to house coal as well as to other coal.

Mr. Gibson

Does what the right hon. Gentleman has said imply that the present elaborate arrangement, by which distributors are guaranteed a certain amount of profit, will also go?

Mr. Maudling

Yes, Sir. That is one of the main purposes of the exercise.