FUEL AND POWER

HC Deb 20 February 1961 vol 635 cc36-164

3.31 p.m.

r. Ray Gunter (Southwark)

I beg to move, That Item Class IX, Vote 5 (Ministry of Power), be reduced by £1,000.

It is some time since the House had an opportunity to debate future supplies of energy, and I hope that sufficient time has passed for hon. Members on the benches opposite to do some meditating so that we may be relieved today of the half-baked gibes that, when the Trades Union Congress and the Labour Party discuss a national fuel policy, what they really have in mind is not the well-being of the nation, but the safeguarding of the vested interests of the miners in the industry. I hope that there will be no suggestion today that the miners' concern in the present situation is born of anything like a Luddite outlook. The miners' history is a bit too raw for them to be worried much about a Luddite background.

As the child of a few generations of miners, I have never yet known a miner who, when the alarm clock went at half-past four in the morning, went into a delirium of joy at the thought of going down the mine; nor, indeed, have I ever found one obsessed by a great ambition to ensure that his son or grandson should work in the pits. I hope, therefore, that we shall today approach this subject on a much wider basis and that we shall accept, on both sides, the fact that this country and the world face a serious problem as a result of new developments in sources of energy.

It may be stating the obvious to say that at present the whole complex structure of modern industry is virtually dependent upon the carbon deposits of 27,000,000 nature, coal, oil and natural gas, but what, we sometimes forget in our arguments and disputes is that these deposits are non-renewable. It is sometimes thought, perhaps, that those who mention the nonrenewability of our carbon deposits are, somehow, melodramatic and a bit feverish; but, nevertheless, we must bear in mind, in 1961, the fact that the carbon resources of the world are finite.

It is of paramount importance that the nation should assess both the dangers and the hopes not of the next five years, but of the next three or four decades. This is not a long period. I suggest that if, at the end of the First World War, only just over forty years ago, the advice of the experts in the industry had been heeded, we should not have found ourselves in much of the troubles which affect our industrial life today. I emphasise at the outset that there is a great problem facing the nation and the world, a problem which will grow in intensity between now and the turn of the century.

A very interesting statement was made by Professor Robinson, of Cambridge. and Mr. Daniel, of the Ministry of Power, in a paper submitted to the International Conference on the Peaceful Uses of Atomic Energy, wherein it was said: It will … be apparent that, even if we make conservative estimates of economic growth and of the future increases in the demand for energy, the world is not far distant, measured in the units of time in which we think of the history of nations and even of the lives of individuals, from the moment when, in the absence of a new source, scarcity of fuel will begin to create serious i problems.… Economic development s largely a matter of adding to the horsepower available to assist the peoples who at present are poor because of the lack of it. There is no task"&3x2014; these scientists went on to say— more important than to ensure that the dramatic advance of the human race over the past 200 years is not reversed over the next 200 years because of the exhaustion of the fuels which gave the opportunity for it. The truth of that statement is beyond doubt. We must accept that the concentrated carbon deposits of the world are finite, and, as has been said, that they represent the product of not a very large multiplier applied to the quantities currently being consumed each year. Therefore, the nonrenewability of coal, oil and natural gas must enter into our consideration of the future of our industrial life. I emphasise that I speak not of the next five or ten years, but of the future well-being of the country in the 1980s, the 1990s and at the turn of the century.

The question may be asked: will the need for natural carbon cease altogether owing to a new source of energy, nuclear fission, becoming available? I believe that the experts are generally agreed that it is simply fanciful to imagine the total displacement of coal, oil and natural gas by nuclear energy. It is now expected that, if all goes well, the displacement of fossil fuels by nuclear energy in ten years will be only about 1 per cent. of the world total. The United States Atomic Energy Commission puts the maximum technically plausible role of nuclear fuel in industry in the year 2000, on certain assumptions, at about 15 per cent. It may well be that, in the next century, nuclear energy will play a very formidable part, but it is not to be doubted that, for at least half a century, or even for seventy-five years. we must look to the sources to which we look today.

I am one who believes that we dare not lag behind in the development of nuclear energy. This nation may have to take abnormal risks in this matter. Perhaps no sacrifice will be too great to ensure that our scientists and technicians are available in sufficient numbers so that, when succeeding generations face these problems, the nation will be in a position to meet them. At present, I submit that there is no substitute for natural carbon as a cheap source of heat and energy. The day may come—it probably will—when there is a substitute, but it would be the height of folly to abandon as useless substantial resources of natural carbon at present.

The other paradox that seems to arise at present is that while most of the world's concentrated deposits are of coal, by far the largest increase in the world's fuel requirements is being met by oil. I have read carefully the report of O.E.E.C., that by the President of the United States and those of other organisations. and it seems to be the conclusion of many of the greatest experts in the world in this field that if the present dramatically high level of oil consumption goes on we cannot avoid the exhaustion of the oil reserves by the end of this century or before. We hope that our industrial tempo will increase, and we hope to see the rapid development of the under-developed countries and their industrialisation, but let us not shrink from the fact that if this goes on at the present rate, by the turn of the century or before we might well be faced with a shortage of oil.

One of America's leading geologists states categorically that it is probable that the United States demand for oil by 1975 will be more than double the United States production, and that the rest of the world will be dependent largely on Middle East production. Indeed, there are many of the world's experts in energy problems who say that if the phenomenal growth in oil consumption goes on oil might well not outlive this century, so that there could be a great scramble for oil, with all its dangers for any nation that does not possess indigenous fuel resources of its own.

To make one more quotation, the chairman of the American Association of Oil Geologists has quoted a figure of an ultimately recoverable reserve of 270,000 million tons of oil. Proved reserves are 40,000 million tons, but 270,000 million tons would not sustain an annual rate of growth of 6 or 7 per cent. for more than a few decades. There is talk of new oilfields, and of the Sahara oilfield, but let us accept the least conservative figure of reserve quoted. It is said that the reserves are 1,500 million tons of oil, but let us remember that that is only one and a half years of oil consumption at the present rate. The most serious students of the energy problem now seem to confirm that the only hope of maintaining for a long period our ever-increasing industrial life, which supports our modern civilisation, is with coal, looking beyond the short span of life of oil.

It may be argued, though I hope that no one will argue it here—I have seen it argued by the oil companies—that the next generation must solve its own problems, "Let us take what may be the immediate advantage of oil, and, forty years' hence, turn back to coal". That is quite unworthy. We have a duty to the next generation and to the generations that follow it, and we also have a duty to the nation to ensure that the life of this nation is not placed in jeopardy by our failure to envisage the future. As Sir James Bowman once said, we cannot do this sort of thing. Coal mining means entering upon a battle with nature, and it is not a battle into which we can go and out just as we like. In coal mining, once you close a colliery you lose the resources you had set out to exploit. Only by tremendous sacrifice and at tremendous cost, thirty or forty years' ahead, could we try to bring that abandoned pit into production, and at a time when, maybe, the need is very great. Large sections of our mining traditions would have gone, and our mining communities would be dispersed.

Therefore, I submit to the House that it is our national duty, on whatever side we may sit, to think carefully and to plan wisely about the preservation of our most valuable and essential asset—our coal reserves. It is imperative that this industry, which is passing through a most difficult period, should be kept in good heart and good health, so that it may meet the very great problems and requirements that will be placed upon it in the future.

I do not underestimate the Minister's difficulties in this matter. If we are to guard and conserve in the national interest our coal assets, so often we find that it is not compatible with the most profitable operation in free competition. If the Minister supports a national policy, and carefully seeks to ensure that the resources of this nation are marshalled for thirty or forty years hence, he may well come into conflict with so many of his hon. Friends, whose doctrinal obsessions demand that the market criterion is the only fuel policy. That is wrong, and I believe that it would be a tragedy for the nation and for the Government unless we can carefully and wisely plan ahead. If the nation is to remain strong and powerful in the counsels of the nation, it is not only the immediate that must concern us, but must be thinking of planning well into the future.

I believe that the future rôle of coal is great, that our national interests demand long-term planning, and that may mean some sacrifices at present so that the future can be healthy. It is necessary to look at the present state of our energy supplies, and particularly at our primary source, which is the mining industry. I state the facts as I see them, and I think that the deductions will be obvious. The coal mining industry has had a fairly rough ride. It has been up at the top and down in the valley. The situation now facing the industry is a complete reversal of that which prevailed throughout the postwar period, when the industry, in the first post-war decade, was faced with an ever-growing demand for coal. Indeed, coal consumption rose from 178 million tons in 1945 to 218 million tons in 1956, an increase of 40 million tons—23 per cent. in eleven years. The labour force increased by something less than 1 per cent. and increased production was achieved primarily by higher productivity, overall output per man shift and at the coal face, both of which rose by over 20 per cent. That was the position of this industry for eleven years following 1945.

Then came the change which has shaken the confidence of the mining industry. It came in 1957, when inland consumption fell by 5 million tons, from 218 million tons to 213 million tons, and exports fell by 2 million tons. In 1958, there was a further and still more drastic fall in coal demand, when inland consumption fell by 10 million tons to 203 million tons and exports fell by 3 million tons to 5 million tons. This drastic fall in coal demand was repeated in 1959, when inland consumption fell by a further 12½ million tons and exports fell by over half a million tons.

This is the position that has to be borne in mind when we talk about confidence in the industry. In the three years 1957–58–59, there was a total fall in coal demand of 33 million tons, or 15 per cent., of which 27 million tons was in inland consumption and 5 million tons in exports. This drastic decline in coal consumption over the last three years has, naturally, been reflected in increasing coal stocks, since, although there have been cut-backs in coal production, the fall in production has been much less than the fall in consumption. Undistributed coal stocks rose from 3 million tons at the beginning of 1957 to 8 million tons at the beginning of 1958, to 19½ million tons at the beginning of 1959 and to 36 million tons at the beginning of 1960.

The important thing to which I wish to draw attention is the effect upon the industry of those three years. There was a cut-back in production of 30 million tons—from 224 million tons in 1957 to 194 million tons in 1960. There was a fall in manpower in the industry of nearly 130,000 men—from 712,000 at the beginning of 1958 to 583,000 at the end of 1960. When the Minister writes his notes and talks to the miners about the necessity for confidence, and states that they must reject pessimism in the industry, I beg him to remember that it is the most difficult thing in the world

—I know this bitterly from my experience in the railways—to tell men to have confidence in their industry and to believe that it has a great future when manpower contracts at such a rate. It may be necessary, but, nevertheless, it is something which destroys the morale of men.

In the past three years there has been the closure of 136 pits. I agree that 83 of them were closed because of exhaustion, but the significant thing is that 53 were closed for economic reasons. As I have said, one cannot close a pit and reopen it just as one wishes. In the light of our pressing demands in future years, it may be that we shall regret the closing of uneconomic pits, as they are called.

There has been a revision of the National Coal Board's plan for 1965, with a reduction in coal output from a proposed 240 million tons to 200 to 215 million in 1965. All this adds up to a decline in the confidence of the miners and leads those engaged in the industry to think that the state of dereliction, not only in the industry itself but in the mining communities, will proceed at a fairly rapid rate.

What are the reasons for the fall in consumption? Between 1956 and 1958 there was industrial stagnation and recession. The recession hit hardest those industries which were the largest consumers of coal—iron and steel. Also, there was increased competition from alternative fuels, particularly oil, about which I shall say a word later. That was the situation until we came to 1960, when there was a marked change in the demand for coal. After a fall of 33 million tons in the preceding three years, there was an increase in 1960 compared with 1959 of nearly 9 million tons to a figure of 203 million tons. Production in 1960 was 194 million tons. It was, therefore, well below consumption. There was a substantial reduction in stocks of about 7 million tons.

There is no reason why anybody should be dissatisfied with 1960. Indeed, there is every reason for satisfaction, as long as we get the facts in their right perspective and keep a sense of proportion about what happened in 1960. Whereas inland coal consumption rose by about 4 per cent., the average level of industrial production rose by considerably more, while fuel oil consumption rose by nearly 30 per cent. and fuel oil imports rose by about 35 per cent.

For 1961, the Board's programme aims at a reduction in production from a planned 195 million in 1960 to 192 million tons in 1961. It thinks that coal consumption is likely to be about 200 million tons in 1961, which, if it is achieved, will mean a further reduction in coal stocks. But the crucial question is—this is the thing which bothers my friends in the industry—whether the improvement in 1960 marked a permanent change in the fuel and power situation, or whether it was due to exceptional circumstances. It is no good the Minister getting dewy-eyed about 1960 and telling the miners that if they keep their eyes on 1960 everything will be all right. The miners have had long experience and do not take one year as a criterion for the future of their industry.

Having, I hope factually, put the position of the coal mining industry since 1945, I wish to say a word about oil and its effect on the energy supplies of this country. Britain's total energy requirements for 1960 were about 264 million tons of coal equivalent. About three-quarters were supplied by coal and about one-quarter by oil. Between 1948 and 1956, before there were any signs of crisis in the industry, the consumption of oil increased by 100 per cent, while the consumption of coal increased by 12 per cent.

In 1948, out of total energy requirements of 212 million tons, coal supplied 91 per cent. and oil 9 per cent. But in 1956, out of total energy requirements of 253 million tons, coal supplied only 85 per cent. and oil supplied 15 per cent. However, while coal was supplying a smaller proportion of total energy requirements in 1956 than in 1948, the amount of coal consumed had increased considerably. It had risen from 192 million tons to 214 million tons.

This change in the pattern of fuel consumption between 1956 and 1959 can, therefore, be looked at in one sense as merely a continuation of the previous trend—a steady and fairly rapid increase in the use of oil over a considerable number of years. But there was one vital difference in those years. Total energy requirements actually fell between 1956 and 1959 because of industrial stagnation and recession instead of steadily rising as in the previous decade. Therefore, the increasing use of oil in the last three years means that oil has been replacing coal instead of supplementing it as in previous years.

Mr. Gerald Nabarro (Kidderminster)

I do not quarrel with the hon. Gentleman's figures in any way. The majority of them have, in fact, been published. But there are two deficiencies in his argument. First, the fall in fuel requirements for specific industries is largely attributable to increasing fuel efficiency, which all of us support. Secondly, he omits to mention in his statistical digest the fact that his energy requirement figures include the whole of the needs of transportation, both by rail and road. That is the major reason for the increase in the use of oil.

Mr. Gunter

If the hon. Gentleman will let me pursue my gentle way, I will come to that point.

I repeat that, out of total enegry requirements in 1956, 214 million tons, or 85 per cent., were supplied by coal and 38 million tons, or 15 per cent., by oil. In 1959, out of total energy consumption of 245 million tons, 187 million tons, or 76 per cent., were supplied by coal and 23 per cent. by oil. Last year, of the total energy consumption of 264 million tons about 196 million tons, or 75 per cent., was supplied by coal and 66 million tons, or 25 per cent., was supplied by oil.

I turn now to the hon. Member for Kidderminster (Mr. Nabarro). It should be made clear that much of the oil consumption is not competitive with coal. In 1959, the amount of oil used as fuel was 56 million tons coal equivalent. Of this, about 31 million tons was competitive with coal, of which 23½ million tons was fuel oil.

If I may finish my statistical survey so that we get the facts right, I would add that between 1953 and 1960, fuel oil consumption rose by about 13½ million tons, or 23 million tons coal equivalent. While the increase was substantial between 1953 and 1957, the really big increase has come since 1957. From 1957 to 1958, fuel oil consumption increased by 3.6 million tons. Of the increase in consumption since 1953, only about one-half has been met from United Kingdom refinieries. The remainder has come from increased imports of fuel oil, which have increased from less than 1 million tons in 1953 to nearly 7½ million tons last year.

The reasons for the increased competition from fuel oil are clear. In the post-war Britain, Governments have actually encouraged the use of oil because of the shortage of coal and the fear that this shortage would continue. In 1947, the tax on fuel oil which had been imposed in 1933 was removed. Circulars were sent by the Government to local authorities encouraging them to use oil. Fuel efficiency services were established and loans were made to firms which wanted to convert their heating equipment.

A second and major factor in the growth of fuel oil consumption over the last three years has been the conversion of about fourteen electricity generating stations from coal to oil. This has been done, not on grounds of efficiency nor because oil was cheaper, but was the result of a Government decision in 1955 because of the then coal shortage and the fear of its continuance.

No one can seriously argue that we can ruthlessly reduce our oil imports or oil consumption. What is required is a careful analysis of the choice between allowing the importation of oil heedlessly so that it causes irreparable damage to a national asset or the planning of imports and the use of oil so that our indigenous asset can be kept intact. That is the task for the Minister. I see nothing wrong in it. We do a great deal for agriculture because we regard it as of sufficient importance to be protected. Looking into the future, why should we not seek to protect, in a balanced and planned way, this great national asset of which we may be in such desperate need in the future?

There is another reason why the Government should carefully consider the question of oil imports. We are told that 1960 is likely to be the worst year since 1951 for our balance of payments. We are told that the deficit might be between £150 million and £170 million. Although the effects of the oil industry's operations upon the balance of payments are not revealed, all available evidence indicates that a substantial part of the balance of payments deficit is attributable to the rapid growth of oil imports.

Between 1955 and 1960, the cost of oil imports rose, in round figures, by £240 million, while the receipts from exports and re-exports of oil products from the United Kingdom rose by £50 million. In other words, the visible trade balance for oil shows a net increase in imports of no less than £190 million. If the greater part of our oil imports were required to meet the needs of transport, they might be regarded as unavoidable. That, however, is not the case. During the past few years, by far the greater part of the increase in oil imports has been to increase the consumption of black oils—that is, oil for purposes other than transport.

Since 1947, the consumption of black oils has more than doubled. It is now well over 30 million tons coal equivalent. Over the same period, the consumption of other oils—that is, for transport—has risen by less than 50 per cent. to about 30 million tons. In other words, the great bulk of oil imports during recent years has been of oil which displaces our own indigenous fuel—coal. This adds an unnecessary burden to our balance of payments difficulties. At a time when it is of paramount importance to strengthen our balance of payments position, there is a case for the most careful thought by the Government to see what can be done concerning oil.

Even when the so-called invisible earnings are taken into account, there is little doubt that the operations of the oil industry result in a drain on our balance of payments which—perhaps the Minister will give the actual figures—may be in the region of £100 million a year. Therefore, I wish to point out the steps which we on this side feel should be taken. It is no good the Minister telling the miners that everything is all right and that there are no grounds for pessimism. The criterion of the market has an ugly ring in the mining communities. Their historic and sometimes bloody battles raged around this materialistic concept.

The industry must have confidence in itself. The Minister must give it a lead to establish confidence in the fact that it has a great future. I suggest, therefore, to the Minister and to the Government that they should immediately set a realistic minimum figure for coal production for some years ahead, to let the miners know that there will be stability. This is the industry's major need, for, without a specific target that men can hold on to, the Coal Board will not be able to plan sensibly its investment and production programmes, nor will the crisis of lack of confidence that those working in the industry are now experiencing be overcome.

The target figure must be kept under constant review. It must be adjusted according to changing trends, such as, for example, the growth of energy requirements, fuel and power technology and long-term changes in the balance of payments position. The Ministry of Fuel and Power should publish an annual report assessing the current position and the policy changes that are required.

To come to what might be done almost immediately, since there is no great cost advantage in the use of oil, the Minister and the Government should turn their attention to dual-fired electricity generating stations. Those which now burn oil should be converted to the use of coal. Reasonable compensation to the oil companies should be met by the Minister. Opencast working should be reduced to the greatest practicable extent, this source being held as a reserve in case of sudden demand. If opencast contracts have to be broken, the Minister should assume responsibility for compensation, it being a condition of such payments that contractors work out with the unions concerned a scheme providing for compensation for any of the workers displaced.

There is one other point. Sometimes we are inclined to sit back and view with a measure of admiration the way in which the German economy has recovered since 1945. Strangely, the West Germans have not shrunk from meeting the problem that arises because of the impact of oil upon coal. They have deliberately imposed taxation upon heavy fuel oil at, I understand, a rate corresponding to about two guineas per ton. I understand that that figure is likely to be increased. I see no reason why our Government should not adopt a similar approach, so that we may guard and cherish our great national asset. An independent investigation should be conducted into the production cost of fuel oil to determine, as far as possible with a joint product of this kind, how far the price of imported oil calls for action in anti-dumping legislation and to review impartially the price policies of the oil companies.

My last point on this is that the Government's policy should be urgently directed to increasing significantly the export of coal. In the interest both of the balance of payments and the stability of the mining industry, the Government should encourage the Coal Board to enter into overseas contracts which will guarantee supplies to purchasers and, in the longer term, higher priority should be given to scientific research in the fuel industries. In particular, the Ministry should co-ordinate the important work of new methods of coal gasification now being carried on by both the Gas Council and the Coal Board.

It is just 21 days ago that, in this House, a Minister of the Crown came to the Dispatch Box and unfolded a very tragic story to us. It has a very close resemblance to the present story, or it could have. We were then told that because of the state of transport in this country nearly £1,200 million had to be written off. Why? I do not indict any Government since the war, but the truth of that was that it started forty years ago.

In 1920, when the impact of the road haulage industry was first felt, experts advised Parliament and the industry to get together to consider the future development of transport, and to see what measure of co-ordination was necessary to plan and to work for forty years ahead. Three weeks ago, because their advice was cast away and we did not have the vision and courage in the 1920s and 1930s to move away from the market criteria, we had to throw hundreds of thousands of pounds down the drain. It would be a tragedy if, at this time, we failed to ensure that in forty years' time the great bounty which has been given to this nation was not in a proper position to play its part.

The railways declined, the morale of the workers went down, confidence went out of the industry and we are having to pay in terms of modernisation up to probably £2,000 million because it is now recognised that, in some form or another, we cannot do without railways. I plead with the Minister not to be harried, not to wilt—not to be so much put out by great pressure from the hon. Member for Kidderminster and the rest of them—but to have vision in this matter and to tackle our responsibilities to generations to come.

This is an age of exhortation. These are days when Ministers go around the country exhorting the people to depart from the path of sin. It may be a far stretch to imagine that the Front Bench have any resemblance at all to the minor prophets but, nevertheless, it is interesting to read the words of exhortation that are recent. The Chancellor of the Exchequer, a week or so ago, in Glasgow, said: The Government must join with the employers and the trade unions in a combined operation, to arouse the people, stir them up, get them to break out of habits of thought, of processes and practices that are old-fashioned, restrictive, defeatist. The trouble about exhortations today is that no one is taking any notice of them. The country is indifferent to them. I will tell the House why. The British are a great people and a strange people in many ways. Ninety-five per cent. do not take a lot of interest in their politicians. It is one of the greatest traits of the British character that they can always treat their politicians with great tolerance, but there is a time when they look to their politicians for leadership.

Before we start to exhort the people to do something, we have to make sure that they clearly understand the nature of the crisis. We must explain it to them so that they may know what we are getting at. Then they have to recognise that the leaders are on the path that will solve their problems in a crisis and, last of all, they have, in such circumstances, to recognise that they have men who can lead. Our indictment of the Government today is that they are without vision and without powers of leadership not only in this sphere, but in everything that they touch.

4.16 p.m.

The Minister of Power (Mr. Richard Wood)

At the beginning of the speech of the hon. Member for Southwark (Mr. Gunter), before he reached his rather more violent end, when he was talking about the supplies of energy in the world, I was reminded of confident forecasts which used to be made in years past and which estimated that the world's supply of energy would be running rapidly to an end. I believe that one confident forecaster put a date to this debacle, that the world's supply of fuel would be running out in 1960. The hon. Gentleman has moved it on a bit, but he still thinks that we shall be in great trouble at the turn of the century.

The basis on which the hon. Member founded his argument was rather less clear, because I have not found any reputable forecaster who believes that the world's supply of energy is, in fact, in this "dicky" state. In fact, the proportion of proved reserves of oil, leaving aside coal for the moment, to world consumption over the last few years has continually been rising, although world consumption, as is evident to us all, has been rising very rapidly itself and behind these proved reserves lie vast quantities of oil still to be discovered. I see no basis at all for the forecast which the hon. Gentleman gave, that the end of energy supplies from abroad is, in fact, imminent.

The suggestions which the hon. Gentleman made at the end of his speech, and which I have heard similarly made on other occasions, appear to me, as I shall try to show, although he vigorously denied this charge at the beginning of his remarks, to be an attempt to apply some of the remedies of yesterday to the problems of today.

I am reminded of a similar attempt that I myself made, when I fell victim to influenza recently, to apply the remedies of yesterday to the problems of today. I tried to clear out some of the unused medicines in my medicine cupboard and apply them to a particular situation to which they did not appear to have great relevance. I made my medicine cupboard nice and tidy, but I think that I spent two extra days in bed that I could have avoided.

My life at the Ministry of Power has been quite short—I am speaking of the past fifteen months and making no prophecies for the future—but I am constantly amazed by the assumption on the part of those who seem to speak with authority that solutions which seemed to meet the situation even a few months ago are, without question, still appropriate today.

The foundation of the case which the hon. Gentleman has put before the Committee this afternoon is that we should fix a minimum figure of coal production in order to protect the industry and give it what he believes to be the necessary confidence if demand contracts; but the fact of the situation, which I shall say something about later, and which, indeed, he did recognise, is that demand for coal at present, not only in 1960 but at the present date in 1961, is running at a considerably higher rate than coal is now being produced. Therefore, there is some absence of realism in this frequent demand for some prescription by the Government of the industry's role and size.

I should like to say—because I think that this is fundamental to our discussion, and it has been fundamental to most of the discussions I have had in the last fifteen months about the fuel policy which this Government or any other Government should adopt—that, as I see it, there are, broadly, three possible alternative lines on which any Government can base their policy. The first line is to take some action to put restrictions on consumption of certain fuels and fix the size of the coal industry's market and be prepared to take further action if necessary to prevent the erosion of this market by competition.

I myself am convinced that there are three main objections to this policy. The first danger it would almost inevitably lead to would be higher energy costs which would result, I am certain, not only in reduction of competition, but if the coal were not consumed, result also very probably in the need to add stocks. The second is that there would be necessity at some time or other, whatever may be said against this by the Opposition or others, to impose some kind of control on consumption.

Thirdly—and this is, I think, most important, and I think that hon. Gentlemen opposite will agree with it—such intervention would inevitably transfer from the coal industry and other nationalised industries to the Government a good deal of the responsibility for both short and long-term plans; and the main commercial and industrial de- cisions would be taken by the Government and the commercial autonomy which the nationalisation Acts rightly aimed to give to the industries would to a very large extent be destroyed.

I am convinced that if the targets which it is suggested we should set are to have any value they must inevitably be fairly high, and they must inevitably, although the hon. Gentleman said that they could be reviewed from time to time, not be changed too frequently. I see that high targets which would be varied only with reluctance, would give a rigidity to the pattern of fuel consumption which, for a trading nation like ourselves, is, I think, only likely to bring disaster.

Those, to my mind, are the main objections to fixing a share of the market of the coal industry and to take steps to limit the competition with coal from other fuels.

Right at the other end of the picture there is a possible policy of unfettered competition, completely unrestricted freedom of choice. The difficulty here is that the market—and here, perhaps, I shall carry the hon. Gentleman with me—left entirely to itself, is unlikely to take account of considerations such as national security and the balance of payments. I am perfectly ready to admit that, and I am convinced myself that those considerations justify some bias in favour of indigenous fuels when they are available at economic cost and when they are equally suitable to meeting consumers' needs, rather than accepting a greater dependence on imports. Therefore, there are considerable objections, I believe, in pursuing a policy at the opposite extreme, one of unfettered competition, or a free for all.

I am convinced that the choice of a fuel policy must lie somewhere between the two extremes. In dealing with the policy on those lines I shall probably win the support of most hon. Members in the Committee. Some would place the emphasis more on protection, others would argue for more competition and freedom of choice. After all, this is part of the fundamental issue into which I believe most great questions resolve themselves: what is the precise blend of order and freedom which we think most likely to meet the needs of the particular situation?

We reject the path of protection. We also reject the opposite extreme of unrestricted competition because we believe that competition, if it is to work effectively, must be in a suitable framework; and, indeed, I am convinced myself that completely unfettered competition in the fuel field would endanger our energy supplies in the long run, and that competition must be supplemented by measures in order to take into account considerations which the market alone is liable to ignore.

If it is accepted that the fuel policy of any Government should lie somewhere between these two extremes then precisely where the emphasis should fall leaves room for endless argument, and perhaps it is in present circumstances fortunate that this debate has to come to an end at ten o'clock, otherwise argument would literally go on for ever. It is also sensible to be prepared to alter the particular emphasis we place in our fuel policy from time to time if changes in the situation demand it.

The Government are convinced that it was perfectly right to take the measures which they did take in the face of the particular fuel facts of the last few years. As the Committee knows, there was a ban on coal imports except from the sterling area; there were severe restrictions placed on oil from the Soviet bloc countries; there has been—and this ties up a little with something the hon. Gentleman mentioned—very considerable modification of the original programme of oil-fired power stations.

There has also been reached a valuable agreement between the gas industry and the coal industry under which the gas industry has undertaken to give to coal first refusal when it is deciding on new gas-making projects; the Government have given encouragement, where costs are similar, to the use of solid fuel for heating public buildings; and, lastly, the Government have provided capital at lower rates than in the open market in order not only to develop the industry, but also to finance the stocks which the National Coal Board built up in the years, to which the hon. Gentleman referred, of declining demand between 1957 and 1959.

There are many who say, and the hon. Gentleman would no doubt argue, that the Government should go a good deal further in tilting the balance in favour of indigenous fuels. Others, on the other hand—and this will be common knowledge to us all—argue that the Government have gone too far. I am generally convinced, when I am criticised from both sides, than I am somewhere near the right position.

The problems of the coal industry, which is the nation's largest and most important supplier of energy, have already featured largely in the speech of the hon. Member and no doubt they will continue to occupy the lion's share of our attention during the rest of the debate.

Mr. Nabarro

No, certainly not.

Mr. Wood

My hon. Friend may not give them his attention, but I think that a number of speakers in this debate will mention coal. There are many reasons why this is so. It is very hard to imagine in the Parliamentary life of any of us here a debate on fuel and power which will not turn very largely on the problems of the coal industry.

I should now, therefore, like to examine the position of the industry within the framework of the fuel policy that I have been attempting to describe. The last full discussion that we had in the House on the industry was in February of last year, almost exactly a year ago, but the industry received some attention in November when we debated the White Paper on Public Investment. I have been re-reading the earlier debates, particularly the first, in which I took part, in November, 1959, when we discussed the affairs of the industry in connection with the Coal Industry Act, 1960, and the Coal Industry Nationalisation (Borrowing Powers) Order, which allowed the Coal Board to increase its borrowing powers.

No doubt some anxieties will be expressed again today which were expressed in those earlier debates, but the situation in the industry, as the hon. Member for Southwark must recognise, has radically changed in the fifteen months since November, 1959. The debate then took place in the wake of a serious fall in demand at a time when the Board had 36 million tons in stock, apart from the other millions of tons in stock which no doubt my hon. Friend will mention because he is very conscious of them.

Mr. Nabarro

Which hon. Friend?

Mr. Wood

My hon. Friend the Member for Kidderminster (Mr. Nabarro), who recently interrupted me.

On that occasion, I expressed the view that the decline in demand would be arrested in 1960 and that a small stock-lift would begin. I am not mentioning any names, but I remember on that occasion other views being expressed which diverged from subsequent facts rather more widely than my own estimates.

In 1960, the total of deep-mined and opencast coal produced was 193½ million tons, and the demand was such that the stocklift in 1960, instead of being the 1 million tons that I estimated, was a great deal more. A total of 6½. million tons were lifted in 1960 and stocks are now being lifted, admittedly apparently because of seasonal reasons, at a rate of over 2 million tons per month. The Board estimates that there will be again a considerable gap between production and demand in 1961 and, therefore, a further considerable stock-lift is likely in 1961. The existence of these stocks is beginning to appear a great deal more useful than seemed likely less than a year ago.

I hope that what I have said already has put some of the problems in perspective. The problems still exist and, no doubt, always will, but it is important that we should realise clearly that the problems of today are entirely different from those that faced us in 1959. I shall deal in a moment with manpower, but I cannot accept the suggestion which has been made not by the hon. Member for Southwark today but in other places, that the shortages of labour in the industry are due to lack of confidence in its future.

Mr. Norman Pentland (Chester-le-Street)

They certainly are.

Mr. Wood

I thought that that was the Opposition's case, but I do not accept it.

Mr. Gunter

Surely the fact that 50 per cent. of those who are leaving the industry are under 31 years of age indicates that the younger men have no confidence in it.

Mr. Wood

I was about to deal with the manpower position but, as the hon. Member for Southwark will know, this is an industry where the movement of men in and out of it has always been most considerable. The manpower position reflects very closely the view that men are taking of the industry at present. My own view, as the hon. Member knows, is not one of pessimism, but one of optimism. I feel that there are abundant grounds for confidence in the industry not only in relation to the future, but also in relation to the past few years.

I will deal, first, with the past. All those who are working in the industry are very conscious of the measures taken by the Board and the Government to assist the adjustment of the industry to reduced demand. Apart from the bias, already mentioned, in favour of indigenous fuels, there have been the measures of stocking, the Local Employment Act, and the considerable reduction in opencast working, and there has been the very gradual and, I am glad to say, very largely painless contraction of output achieved by such measures as allowing Saturday working to lapse and the suspension of recruitment. There has been the consequent very low rate of unemployment in the industry. There are not many other industries that have a lower rate.

Therefore, looking at past measures, there are grounds for confidence that treatment of the industry is likely to maintain a similar course in the future. But demand for coal in the next few years looks certain to exceed the likely production. I should have thought that it should give the greatest ground of all for confidence that the likely demand for one's product is rather larger than the likely production of it.

Mr. Arthur Probert (Aberdare)

How does the right hon. Gentleman expect to make up the deficit? What means will he employ?

Mr. Wood

I was about to deal with manpower, but, first, I wanted to take the opportunity of paying a very sincere tribute, both personally and otherwise. to Sir James Bowman and Sir Joseph Latham and the late Mr. Hembry who, as hon. Members know, was a member of the National Coal Board. All three gave the industry great leadership at the time they served it. I think that hon. Members would particularly like to express gratitude to Sir James Bowman for what I believe was a great achievement. At a time when total output was being brought in line with demand, he achieved a steady increase in output per man shift. That is an achievement of which he can justly be proud. I am sure that all those who knew him would wish him happiness in his retirement. I am sure, also, that they would wish well to Mr. Robens, who is no stranger to us. and to Mr. Browne, the Deputy-Chairman.

Mr. Albert Roberts (Normanton)

Will the right hon. Gentleman agree that output per manshift depends largely on long-term planning?

Mr. Wood

I am sure that the hon. Member is right and that it has a great connection with long-term planning. I was merely suggesting, and I do not think that the hon. Member will disagree, that the achievement of an increase in output per man shift at a time when total output was falling is something on which Sir James Bowman deserves congratulation.

We have also read today of the death of Sir Charles Reid. Many hon. Members knew him well. His crowning achievement was his Report which drew attention to the changes needed in the industry to bring it to a state of full technical efficiency. I did not have the pleasure of knowing him, but, as I have said, many hon. Members did and he certainly impressed his personality clearly not only on the Coal Board, but on the Ministry and on industry generally. I am sure that we would all wish to send our sympathy to Lady Reid and to the present Chairman of the Durham Division of the Coal Board, who is personally known to many of us.

I return to the problem of manpower and point out that the reduction of the number of men in the industry was a deliberate policy of the Coal Board in the early months of 1960 and, with the restriction on recruitment, about a year ago the industry was losing men at an average rate of 1,400 men a week. There was then a substantial improvement in demand, which became quite evident in the middle of 1960, and the Coal Board resumed general recruitment. It is quite clear, however, that the momentum of decrease takes some months to arrest and for that reason losses in manpower continued for the rest of 1960, but by the end of the year had fallen to 350 a week.

Since the end of 1960, I am glad to say that the position has been comparatively stable. That is a reason for confidence that this downward trend, which was the result of the deliberate policy of the Coal Board, has been arrested.

Therefore, my answer to the hon. Member for Aberdare (Mr. Probert) is that I hope, with the resumption of recruitment, that the deficit of manpower. which is needed in the industry to man the pits, will be made up.

Mr. Probert

I referred to the deficit of coal production, not manpower. How does the Minister suggest that we will make up that deficit?

Mr. Wood

Fortunately, at present there are stocks and the deficit of coal production will provide opportunities to lift a certain tonnage of those stocks in 1961, and probably during 1962 and 1963. Obviously, if the demand for coal remains at about its present level the deficit can only be made up by increased productivity and higher O.M.S. in the pits now operating.

Mr. E. Shinwell (Easington)

The right hon. Gentleman is dealing with what I regard as the crucial problem affecting the industry. He has spoken of confidence in its future, but then went on to tell us—and he is dealing with the facts quite realistically—that the Coal Board intends to lift 2 million tons a month out of stock, which is 24 million tons this year. Is that the position? If that is so, and the Minister informs the country that the demand for coal will increase, but will be met out of stocks, surely that will disturb confidence in the future of the industry and some people will change their work.

Mr. Wood

I cannot have made myself clear to the right hon. Gentleman. The position is that stocks are at present being lifted at the rate of 2 million tons a month, but that does not mean that for the rest of 1961 they will be lifted at that rate. As the right hon. Gentleman knows, with his great experience, stocks are not lifted quite so quickly in the summer as in the winter.

Mr. Shinwell

Can the right hon. Gentleman say what is the estimate of the reduction in stocks from that source this year?

Mr. Wood

Although my estimates in the past have been reasonably accurate, I am shy of making a further estimate. However, I think that the reduction of stocks will be about 7 million tons to 10 million tons this year and, therefore, it will take a little time before the situation which the right hon. Gentleman envisages takes place. One of the handicaps to recruitment—and I suggest that it is a very much more potent factor than the alleged lack of confidence in the industry—has been the competition not only from the motor industry in the Midlands, but also of a great many other fields of employment in areas where miners are most needed.

I imagine that the competition of other fields of employment which carry few of the very real difficulties of coal mining is a much stronger reason for the difficulty the Coal Board finds in attracting men to the pits than the suggested lack of confidence. I am also convinced that the recent wage award will have an effect in the right direction, but I am also convinced that it will cost money. The Coal Board is well aware that this added burden must be offset by improvements in productivity and in new efforts to reduce other costs.

It will be appropriate if I now turn to the finances of the industry.

Mr. Bernard Taylor (Mansfield)

Can the right hon. Gentleman tell us what was the intake of juveniles into the industry during, say, the past twelve months or two years? That is very important for the future of the industry.

Mr. Wood

If the hon. Member will be satisfied for my hon. Friend to give the figures when he replies to the debate. I will see that he does so.

I turn now to the finances of the industry, and to try to make it more comprehensible I shall divide it into four sections. The first section is the question of capital investment; the second, total capital requirements; the third, borrowings; and the fourth, revenue account. There has been no modification of the general lines of the Coal Board's plan for continued reconstruction and modernisation of the industry but, as foreshadowed in the White Paper in April, 1960, the Board made certain reductions leading to a lower level of capital investment than was envisaged a year ago.

The November White Paper mentions that the capital investment of the Board which is planned for 1960–61 looks like being at least £20 million lower than the approved figure of £120 million for 1960. That, therefore, has an effect on the Coal Board's total capital requirements. They are reduced, first, by the lower level of capital investment which I have just mentioned, and, secondly, they are influenced by changes in working capital which depend mainly on stock building and stock lifting.

As the Committee will remember, in December, 1958, and November, 1959, it approved Orders providing extra money for the Board to finance a heavy programme of stock building. However, in 1960, as we have noticed, stocks were lifted. I hope that the same will be true in 1961. The process has, therefore, been reversed and the requirements of the Board in working capital have been reduced. The total capital needs are, therefore. less. This has an effect on the borrowings of the Coal Board, which are running at a much lower level than was contemplated a year ago.

In January, 1960, my hon. Friend the Member for Kidderminster will remember that I accepted an Amendment which he moved after a more than usually persuasive speech. My hon. Friend was anxious on that occasion to reduce the annual limit from £75 million to £50 million. I am sure that the Committee will recall his triumph. I gave my opinion, which was quite wrong, that the new annual limit which my hon. Friend held us to, of £50 million, would almost certainly be exceeded in the fiscal year 1960–61. I was a long way out, because borrowings have, in fact, turned out to be £20 million, mainly because of the reduced capital investment and stock lifting, which I have already mentioned.

Mr. Nabarro

I am very grateful indeed to my right hon. Friend for his felicitous references to my activities on an earlier occasion. It is no triumph on my part at all. Evidently a combination of his administrative skill as Minister and my perspicacity has had the desired result.

Mr. Wood

I am glad that my hon. Friend is generous enough to allow me to share his triumph.

Lastly, I come to the revenue account of the Board. I have already told my hon. Friend the Member for Cirencester and Tewkesbury (Mr. Ridley) at Questions today, that I cannot disclose details of the Board's revenue position before publication of the accounts for 1960. which will take place in a few months' time. However, in January of last year, the occasion to which I have just been referring, when I was seeking extended borrowing powers for the Board, I gave the House certain information about the Board's trading results for the previous year. Therefore, I have come to the conclusion that I should be very much less than frank if I did not tell hon. Members the broad outline of the Board's revenue position at the beginning of 1961.

I have already mentioned the reductions in capital investment and the increases in stock-lifting, but these in themselves do not produce any immediate or major improvement on revenue account. The Board's decision in September, 1960, substantially to increase the price of coal was taken for one reason, which was that without such an increase the revenue prospects of the Board would have been extremely bad. But, in fact, the new increased prices, as the House is aware, operated only for the last quarter of 1960, and, therefore, they could not be expected to prevent a considerable revenue deficit in that year.

I do not think that at the moment I am saying anything which will come as a surprise to serious students of these matters. The Board has already published a statement for the first half of 1960 which shows that in the first quarter—January, February and March—it made a profit of £3 million, and m the second quarter it made a loss of £10 million. As the House knows, the third quarter of any year is always a bad one, and, therefore, it is quite inevitable that if the price increase was not effective, as it was not, until October last, 1960 would show a substantial loss. But while the loss was expected by all who had studied the recent trends of the industry, it is none the less a matter of serious concern to the Government and to the Board.

Mr. Nabarro

And to me.

Mr. Wood

In fact, 1960 is the fourth year running in which the Board has incurred a revenue loss.

Therefore, I thought it right to put before hon. Gentlemen well in advance of the publication of the Board's accounts the general shape of the present financial situation, and to go further and to assure the House that this is a matter of concern to my right hon. Friend's and myself and that the Government, together with the Board, are now examining the position which I have just described, and, further, that I will accept the obligation, if need be, to bring the matter again before the House when those discussions are complete.

I accept the challenge to work with the new Chairman of the National Coal Board, as I worked happily with Sir James Bowman, to try to meet the continuing problems of the coal industry. I have been convinced, during the last year and a quarter, that there is a growing realisation that some of today's problems would exist whatever the organisation of the industry and even if those running it possessed superhuman efficiency and acumen, because these problems have their roots—here I am in entire agreement with the hon. Gentleman—in the changed conditions of the last four years. and they do not all come to an end when the industry has adjusted itself to the new level of demand for coal.

I am convinced—here, I cannot carry the hon. Gentleman with me—that the answer to the problems of coal is not to be found in guaranteed targets and other measures of protection from the competition of its rivals. The answer lies, rather, in further improving the industry's efficiency by such measures as the Board's present programme of mechanisation, substantial increases, which I hope will take place, in O.M.S., and continued pressure on costs, and I am also convinced that that Board should be in a position to be able to meet a range of possible demands and to supply the maximum proportion of its sales from the lowest cost sources.

I feel that the path of protection is not only a very dangerous one for this country. I believe that, although the hon. Gentleman did not agree, it would ultimately spell disaster for the coal industry because it would fatally sap its competitive power; and a protected industry would progressively fail to produce the coals consumers wanted at prices they were prepared to pay. I am convinced that the end result would be that it would become less and less able to meet the challenge of other fuels in the years ahead.

4.57 p.m.

Mr. Arthur Probert (Aberdare)

I have been appalled by the speech of the Minister. The only thing that I can say on his behalf is that it is totally out of keeping with his character, to which my hon. Friend the Member for Southwark (Mr. Gunter) made reference.

I should like to refer to one or two points mentioned by the Minister, before I go on to the main part of my speech. The right hon. Gentleman said that we were asking for a minimum figure which the National Coal Board would be expected to produce. And he attacked that assumption by saying that already the Board's target is higher than our figure. But surely what we are asking is that there should be a figure below which the Board should not go. That is the relevant point.

The right hon. Gentleman also talks about the policy of the Government as having to run the Board. Surely what we are asking is that the Government should give some positive direction to the Board and should not have to run the Board in its everyday affairs.

The Minister also mentioned what my right hon. Friend the Member for Easington (Mr. Shinwell) rightly pointed out was the nub of the problem at present. that there is likely to be a deficit in coal production to meet the internal requirements within the next few years. That is a very serious statement to make. The Minister assumes that we shall meet the deficit from existing stockpiles. However, I should like to know how long those stockpiles will exist.

The Minister also spoke about the men having faith in the future of the industry on the basis of existing figures. There is in my constituency at present 4 per cent. unemployment owing to redundancy and short-time working in various factories. Yet the pits are short of between 300 and 400 men. What attraction does the industry offer to those men, who, despite the fact that they are out of work, will not go back into the pits?

I found myself 100 per cent. in agreement with the remarks of my hon. Friend the Member for Southwark who, unlike the Minister, saw the problem in perspective. That is what we have to do. It has been apparent to all those who are concerned with the industry that the Government are themselves totally apathetic and totally unaware—this has been revealed today by the Minister's statement—of the future prospects of fuel. This unconcern is shared, unfortunately, by the mass of the people in the country. I do not blame the people for that. Sufficient warning has not been given for the Government about the position that we might be in during the next few years. If we go short of fuel—that is possible now, according to the Minister's statement—within the next few years, the inevitable consequences for the country will be very serious indeed.

I am not making a constituency point, because, if coal is urgently required for the next few years, certainly the 10,000 miners in my constituency will have employment in the pits—if the pits are there. That is the problem as I see it.

I do not want to go into facts and figures, because too many of them have been bandied about from both sides of the House, including by me. We have been plaguing the industry from day to day, month to month, and year to year. We must consider trends and the fuel requirements of this country and of the world, as was indicated by my hon. Friend the Member for Southwark, over the next thirty or forty years.

It is a common illusion that we shall be tided over our future fuel deficit by nuclear energy. It has already been pointed out that, on the most optimistic estimates, nuclear energy, by the end of the century, will supply only 15 per cent. of world fuel requirements. That is a comparatively infinitesimal figure. All we can hope from nuclear energy is that it will assist in meeting the fuel supply which we shall desperately need.

We must impress upon our people that coal, gas and oil are not renewable fuels. Once they have been taken out of the earth they are gone for ever. I am gratified that my hon. Friend mentioned the more important aspect that experts say that in thirty or forty years' time we shall be running short of oil. That is why it appals me that the right hon. Gentleman cannot see what is happening in perspective. I must add, however, that there are also experts who contend that we can extend that period for a few years. But we cannot afford error on either side.

Mr. William Stones (Consett)

We cannot: afford to waste any.

Mr. Probert

We cannot afford waste, as I shall show.

We have not considered, in relation to industry as a whole, the nature of coal economics. The cry goes out, particularly from hon. Members opposite, that we should close uneconomic pits and make coal competitive. But it is not as simple as that. I am not here referring to the grave social consequences that occur when a pit closes—though, goodness knows, I know about them. I am referring to the consequences to the country as a whole and to mankind.

If we close a pit we can never reopen it, and we have lost for ever—I stress "for ever"—the reserves which will be so valuable to this country in twenty or thirty years' time—not even in fifty or sixty years' time. I know from experience in my constituency that it was the policy of private coal owners—I do not blame them, although they were wrong—in the harshly competitive world of the time, to rip up the more profitable seams and close the uneconomic seams.

What happens during a shortage of coal? We can never reopen districts to get at these seams because they are flooded, or the strata has been affected, or there has been subsidence. That was the result of ruthless competition, in which hon. Members opposite now wish to indulge again.

When its goods are not being produced at an economic price a factory can close, but when the goods are again required at economic prices it can reopen and take back the men and women employees again, because the nature of the industry does not preclude it from doing so. But that is not so in the coal industry.

I want to give the Committee what I believe to be startling figures. The present disposition of the world's use of fuel is that seven-eighths of the world's fuel is being used by one-third of mankind, while two-thirds of mankind uses only one-eighth. One can imagine what the position will be in the near future when, as we all hope, the under-developed countries, where people are now starving, only imperceptibly increase their industrial production.

The scramble for the dwindling supply of oil is something to which I do not look forward. That is why I feel so seriously that the nation should now make sure that, when the time comes, as it will, inevitably—far quicker than the right hon. Gentleman appears to think—we are in a safe position.

As the right hon. Gentleman obviously knows, natural gas supplies in the world are the smallest supplies that it has. This must be a warning to the gas industry that it should not indulge in long-term capital development for the importation of natural gas, because reserves are dwindling fast.

What about oil? Estimates have been given of the maximum peak production of oil in the United States between 1960 and 1965. In a book, "The Next Hundred Years," published in 1957, Mr. Harrison Brown wrote: ‡ if we assume the total initial reserve of petroleum in the United States to be 150 billion barrels, we might expect to pass through the peak of production between 1960 and 1965. We are now in 1961. Mr. Brown went on: On the other hand, if we assume that the petroleum available is one-third more, or 200 billion barrels, the maximum is postponed only for six years. Those are startling figures.

I have another quotation from the article, "Current Trend of Production and Consumption of Sources of Energy," by Mr. Eugene Ayres: … it seems probable now that US. demand in 1975 will be more than double U.S production and that the rest of the Free World. will be dependent largely on Middle East production. If this comes to pass we may expect the use of oil to be almost exclusively limited to internal combustion and other similar unique applications. Those are quotations from experts, and I am appalled when the right hon. Gentleman blithely looks at the matter through rose-tinted spectacles.

My hon. Friend mentioned the Sahara. So much has been said of resources of oil there. There are 1,500 million barrels of oil in reserve in the Sahara, it is stated. But considered as part of the total of world production, over eighteen months the whole of that could be used up. How can we rely on that source? The lesson is clear. We must insist that the Government have a national fuel policy to ensure the safety of the nation and the people for whom we are responsible. It is certain that the world will continue its economic growth much more rapidly in the underdeveloped countries than at present. Indeed, we are all hoping and working to that end. If that growth is related closely to increased industrial production, the decline in oil reserves and natural gas will quicken. That is the position facing us.

All that we have heard today lays great stress, despite what the hon. Member for Kidderminster (Mr. Nabarro) has said repeatedly, on the great importance of coal as our indigenous fuel. We are very fortunate to have that great wealth under our earth. Yet what we are doing now is flagrantly to throw it away, disregarding our grandchildren, our greatgrandchildren and the future safety of the country.

I am well aware that I have not touched upon the human problems involved. I feel that that is a matter which is the prerogative of those who belong to the great National Union of Mineworkers and who defend its members so vigorously, as they have done so for so many years.

I am in constant touch with the miners, who are personal friends of mine. I am in constant touch with the leaders of the National Union of Mineworkers, who are also personal friends of mine. I know full well, despite the figures which the right hon. Gentleman gave us of recruitment and so forth, that there is great concern in the industry at present. To talk about youth going into the industry is wrong. I do not see that happening. The significant thing was that when we had National Service boys were going into the pits to avoid call-up. There is now no National Service and they are not going into the pits. There is no attraction for them to do so. I hope that the figures which we shall get later will belie what I am saying. I should welcome them if they did. That is certainly not the position in my constituency.

I will close now, because many of my hon. Friends, and no doubt many hon. Members opposite, wish to speak in the debate, but before doing so I would ask the Minister and the Parliamentary Secretary to consider much more deeply than they have done not what is to happen this year, next year or the year after, but what is to happen in ten or twenty years' time when the country may be involved, perhaps through no fault of its own, in international problems. I will not say involved in war—heaven forbid. If, at that time, we have not the indigenous fuel in the country, how are we to get it, in view of the worldwide scramble that there will be for the dwindling sources of oil?

The right hon. Gentleman should have put forward today a national fuel policy. I do not propose to suggest what I think that policy should be. I want to hear it from the Government first. I have my own suggestions. As far as uneconomic pits are concerned, it is my opinion that we should not close them in order only to work profitable seams. If it were a question of choice and if we found that by taking the best seams first it meant that we should lose the uneconomic seams, then we should take the uneconomic seams first and the profitable seams later. If we cannot do that, we should keep the uneconomic pits in a state of care and maintenance. The cost of so doing would be a national charge. I would stress that. Do not ask me how it should be done. It should be done by the Coal Board.

If we could produce a national fuel policy now we should deserve all the praise possible from future generations. This great nation can only preserve its prowess by having a plentiful supply of indigenous coal in the future. If we ensure that, we shall deserve praise as responsible Members of Parliament and as responsible Ministers. Certainly, those great men, the miners, who are carrying on in the most arduous conditions, would deserve praise, too. That is what the Government should be doing this year, not next year or the year after, When it will be too late.

5.14 p.m.

Colonel C. G. Lancaster (South Fylde)

The most heartening thing which has emerged from the debate so far seems to me to be that the recession in power requirements appears to have passed and that we are once again emerging into a condition where additional power requirements are facing us.

What I want to talk about this afternoon is the part which coal should play in that situation. Before I do so, however, I hope that the Committee will allow me to add a word to what my right hon. Friend said about Sir Charles Reid. I knew Sir Charles for many years. I admired his qualities and the part he played in this great industry. He entered the industry at an early age and by reason of his abilities and his character rose in due course to be the chief general manager of the Fife Coal Company. With the advent of the war, he was selected to be coal production officer first for Scotland and then for Great Britain.

In 1944, Sir Charles Reid became celebrated as the chairman of the committee which was set up to consider the technical problems of the coal industry. The recommendations of that committee were such that, I think, had we pressed ahead with them under the auspices of the Gower Commission the situation today might have been very different. I have had opportunities at various times of collaborating with Sir Charles Reid in some part of his work and I should like to add my meed of praise for the part which he played in the industry during a very long life.

What we have to consider today is the part that the coal industry should play in our requirements in the light, as I have said, of these requirements beginning to show themselves to be on the increase. Before we do so I think it would be as well to look at what happened in 1960. Despite what may appear to have been a satisfactory increase in a certain direction, 1960 was a bad year. When we discussed coal a year ago I said that if it were the intention of the Ministry to maintain stocks at their existing level or even to reduce them, this could only be done in one of three possible ways. We could close down additional pits, there could be short-time working, or we should have to tell managements to go slow.

In his winding-up speech in our last debate on the industry, my hon. Friend the Parliamentary Secretary said reluctantly that it looked as if we should have to adopt the third alternative. In fact, we did something quite different. We ran down manpower, at a pace which I think was unwise. In 1960 we lost 50,000 men. That, in my opinion, was not a sound thing to do. Obviously, there must be some reduction in manpower when we are pulling up an industry at the expense at which we have done so, but not at the rate of 50,000 men in one year.

That is having an immediate effect both in South Wales and the Midlands, in particular, where they are short of men, where they have the capacity and where we could be boosting production were the men available. Despite the reduction of 50,000 men the financial results of this, as my right hon. Friend suggested, was not satisfactory on the year's working. I do not know what the final figure will be, but it will probably show an additional loss of between £10 million and £15 million.

How did we set about facing up to this loss—by increasing the price of coal by up to 10s. a ton? I do not think that that was very wise, either. It has imposed an additional burden on our export trade and on our steel trade, in particular, which will make additional exports a matter of great difficulty. We should have been far wiser, I believe, to have recognised that we were running the industry expensively and that the sound thing to do was not to increase the cost of coal, but to set about such economies as could be undertaken.

The Committee may well ask: what could those economies be? Let us take one example. I shall call in aid the researches of the Select Committee on Nationalised Industries, which not only looked into the affairs of this industry but, quite recently, looked into the affairs of the railway industry as well. What did we find? We found that the 700,000 people employed on the railways are being administered by a Commission in London employing about 700 men. In the coal mining industry, we have about 600,000 men administered in London by the National Coal Board, at Hobart House, by a staff of well over 4,000. That not only means 4,000 men representing 3s. 6d. on every ton of coal produced, but 4,000 individuals breathing down the necks of management in the provinces who are producing the coal—

Mr. Probert

Those figures are rather startling. Would not the hon. And gallant Gentleman agree that in the Coal Board there is a far greater preponderance of scientific officers in relation to men than there would be in the transport industry?

Colonel Lancaster

That may well be, but the sum total of the thing is that this very large amount of money—3s. 6d. on each ton of coal, representing 7s. on every ton of steel produced—is an on cost, apart from all the other on-costs that go to create a position in which coal today is an expensive commodity.

In spite of the fact that we have made—let us recognise it—considerable advances in O.M.S. and O.M.Y., for the first time in my life we find ourselves lagging behind our chief competitor in Europe, the Ruhr coal mining industry, which is producing coal, both overall and at the coal face, at a higher rate than we are. I have never known that to happen before. Geology has not altered in that period. The Germans are still mining coal 900 feet deeper than we are, our seams are still much flatter than theirs, we do not have to drive roads horizontally as the Germans do, nor do we stow coal as they do. Nevertheless, Germany is producing coal at a great O.M.S. than we are, and at a cheaper rate.

If that is so—and, indeed, it is factual; I can produce the figures—there must be something wrong with our industry—

Mr. David Ginsburg (Dewsbury)

Before the hon. and gallant Gentleman leaves that point, should he not, for the sake of fairness in the comparison, add that the length of the shift in Germany has been increased by half-an-hour in the last few years? That, of course, has made a very important contribution to the O.M.S. figure.

Colonel Lancaster

Whether or not that shift was increased, the outcome is that, for the first time in my experience, the Ruhr German industry is forging ahead of ours—

Mr. Thomas Swain (Derbyshire, North-East)

The hon. and gallant Gentleman has said that the German Ruhr O.M.S. figure is higher than ours. Can he give the output per man shift and the output per man year over the past twelve months? Can he give the comparative figures, and not leave it in the air?

Mr. Shinwell

And for bituminous coal, not brown coal.

Colonel Lancaster

The O.M.S. for Western Germany in 1959 and the first half of 1960 was, in output per man-shift overall, 1.433, as against an output in this country of 1.399.

Mr. Swain

That is for 1960?

Colonel Lancaster

The first half of 1960.

Mr. Swain

I suggest that the hon. and gallant Member does some homework.

Colonel Lancaster

I do not draw that comparison with any pleasure. I do not want to say that the Germans are better coal miners than we are. We have heard in the past of how we were doing better than coal producing countries in Europe, but I think that when such a situation arises it is high time that we looked at the industry, and looked at it critically.

How critically has this industry been looked at during the last fourteen years? There has been one major inquiry—that of the Fleck Committee—whose recommendations, I believe, were, on the whole, almost disastrous. What were those recommendations? They had the effect of centralising an industry that has already become too rigid. The Fleck Committee recommended a number of additional posts that proved themselves to be expensive and meant more men being taken from the areas and regions and brought to London. The sum total of the Fleck Committee's recommendations meant nothing other than to solidify a condition of affairs that, as I say, has already become very rigid.

Would we not be wise now to look again at the industry, and to see whether the time has not come when we can bring about some further improvement? I think that the time is ripe for that. As I said a year ago, we are at long last in the fortunate position of having men at almost every level of management who have come to their industrial maturity at this moment, and who can stand comparison, certainly, with men of any time during my experience of the industry, and can probably stand comparison with managements in any other part of the world.

We have a first-class lot of technicians and managers throughout the industry at this moment ready, I believe, to take on far greater responsibility than they have hitherto been given. There is an opportunity for devolution that has probably not been there before. If Mr. Robens, who is taking over the chairmanship of the Coal Board—and whom we all wish well in the problems that lie ahead—can bring about a considerable degree of devolution, and considerable economy of manpower at the centre, I think that we shall begin to see the advances that can flow from a state of affairs where management is ready—indeed, willing—to accept further responsibility—

Mr. James Griffiths (Llanelly)

The hon. and gallant Gentleman has had a wide experience of the industry, as have others of us. We know that it is an industry that has its history. When the hon. and gallant Gentleman pleads for devolution of administration, would he not agree that any system of devolution must steer clear and keep clear of the decentralisation of finance and wages, otherwise it will add to the troubles of the industry, and bring back old memories and old conflicts?

Colonel Lancaster

I agree entirely with the right hon. Gentleman the Member for Llanelly (Mr. J. Griffiths). Devolution does not necessitate a breaking away of wage agreements from central control. I have never suggested that. I am recommending devolution purely on the managerial and administrative level. I want to see the responsibility and the initiative of management at all levels given its full opportunity, and I believe that the time is now ripe for that.

I am hopeful that Mr. Robens who, I am sure, is capable, and is anxious to see the improvements that must be forthcoming if we are to make this an efficient industry brought into force, will realise that he has now an opportunity of bringing about a degree of devolution that cannot have any but good results. I hope that he, with my right hon. Friend, will be given full scope for making such changes as are required to bring this industry up to a state of efficiency.

I go further than that. If Mr. Robens is to make a success of his task he must be given, to help him, a Board which is capable of doing the job which a central Board should do; that is, a Board capable of promoting policy, enthusing the industry and giving a lead in a way in which only the right Board can do. Boards are not made merely by conglomerating the functional heads of departments, as has been done in the past. If Mr. Robens is to have a Board which will enable him to do the work which I am sure he is anxious to do—and which certainly I feel that he is capable of doing—he must be given an opportunity of recruiting to that Board men of wide experience in industry, commerce and the trade union movement.

We must get away from the idea that merely by putting the heads of functional departments together we can thereby assume that a policy-making Board is created. It is not. I do not want to elaborate this aspect of the matter, but I cannot for a moment believe that if we leave the matter as it is at present, and if Mr. Robens concerns himself merely with devolution and does not set about creating round himself a Board capable of giving the right policy decisions for the industry, he will succeed.

I hope that in both these endeavours Mr. Robens will have, as I am sure he will have, the co-operation of my right hon. Friend and the blessing of this House. He has an enormous task before him. He will succeed the more readily if we can avoid perpetuating a condition wherein one side is tilting against the other in coal questions. We should rather join together in giving them the joint support of both sides of the House. If we do so I have a very real feeling that he will succeed in his task.

5.32 p.m.

Mr. J. Hill (Midlothian)

I have listened very attentively to the debate, and especially to the Minister. I heard him say that the Government have been doing their best for the industry, but I am quite sure that he will have great difficulty in convincing the miners of that. I cannot see that the Government have been doing more for the coal industry than was done in the past. We have three major nationalised industries. If they were working together it would not have been necessary to have stocked up any coal at all. Most of the generators are double burners and there is no reason why they should not be burning British coal instead of imported coal.

The right hon. Gentleman also inferred that the industry had been assisted by low rates of interest. Again, I do not think that the Government have gone far enough. We hear about the Coal Board being "in the red", but I think it is generally agreed that one of the main reasons for that is the high rate of interest it has to pay on capital borrowed for development of the industry. I wish to suggest how more money could be saved.

The hon. and gallant Member for South Fylde (Colonel Lancaster) talked about 4,000 employees of the Coal Board "breathing down the necks of the miners". Could I draw his attention to another part of the trade, where other people have been breathing down the necks of the miners ever since the industry was natonalised? I refer to the ex-owners. They have been breathing down the necks of the miners to the extent of £280 million and still to the extent of about £14 million a year. That is something which the Government should look at. They should consider ways and means of reducing that hot breath on miners' necks. It is rather strange that one of the common expressions in the industry should be redundancy when there is more redundancy in that direction.

The reason why I refer to Scotland—perhaps I should be careful, as I see that we are designated aliens now—is that as a Scots miners' Member of Parliament I am very interested in the miners of Scotland. In Scotland, last year, the amount of coal available for sale including deep-mined and opencast coal, was about 19 million tons, but sales in Scotland amounted to 20 million tons. It is a sad state of affairs when Scotland has to import coal from England. I have heard the expression, "taking coals to Newcastle", but in the east of Scotland we have had the experience of coal being taken from Newcastle to Scotland to burn in generators.

Scotland imported 1½ million tons of coal from England last year. Despite that, at the end of last year and beginning of this year, there was a shortage both of house and industrial coal. On the banks of the Forth, at a little place called Portobello, on the edge of the Midlothian coalfield, lorries have been running for 24 hours a day bringing coal from the Newcastle area to keep a generator going.

I hope that both the Government and the Coal Board will remember that when they are discussing any further closures in the near future. We have lost more than 40 pits in Scotland in the last two years. I hope that we are not to lose any more. I agree that a pit which is exhausted must close, but, like some of my hon. Friends, I do not agree that such pits should be closed for economic reasons, because the money is in the industry to pay for any loss which would be incurred.

The question of manpower has been discussed a great deal this afternoon. In Scotland, we lost 17,000 men from the industry in the last two years. The Coal Board is again going in for a recruitment drive. I have not heard any hon. Member, on either side, say what attraction can be given to young men to go back to the pits. The best way to attract them is to give them improved wages and to restore the 7-hour day. Last week, the Chancellor of the Exchequer said that the average wage in the country was £14 a week. I thought, when he said that, that he should come to Scotland and to the mining area I represent, where three-quarters of the day wage men and surface miners are earning much less.

A day wage earner underground on a basic wage with no overtime—and there is very little overtime in the industry now—is lucky if he takes home more than £9 a week. A man on the surface takes home £8 a week. I am sure that they would be very happy if the statement by the Chancellor about the average wage in the country meant that they were taking home £14 a week to their wives.

The decision to set up smokeless zones, which has not been mentioned today, is another factor to remember.

Mr. Nabarro

Very good, too.

Mr. Hill

I did not say that they were not.

I suggest that when the Government make up their mind to carry out their promise to install in Scotland two plants for the production of smokeless fuel, they set up one of those plants in my constituency, where we have plenty of coal. Because of the lack of smokeless fuel, merchants and customers in the east of Scotland have been complaining about not being able to get it.

I know that many other hon. Members wish to speak. I therefore, suggest that the Government look again at the set-up and give us the co-ordinated fuel policy for which we are asking. Such a policy would give miners security and would help to reduce the balance of payments.

It may seem odd that hon. Members representing mining constituencies should argue that the coal industry and pits should be kept open and, at the same time, criticise the conditions in which the miners work. My answer is that if the Government were prepared to provide alternative employment in Midlothian we would not argue for the pits to be kept open. We would insist on closing the lot.

I would remind the House of a statement made in 1940 by the then Prime Minister, after the fall of France. He was addressing delegates from every colliery, at a meeting in London. He said: Our backs are to the wall. Go back to the coal-fields and tell your men that we must have more coal if we are to survive and that if they give us that coal the country will never forget. I hope that this House of Commons and the country will never forget.

5.42 p.m.

Mr. Gerald Nabarro (Kidderminster)

I should like at the outset to congratulate most warmly the hon. Member for Southwark (Mr. Gunter) on his first appearance at the Dispatch Box in a major fuel and power debate. I listened fascinated to his lengthy speech which was impeccable in its statistical references. He would not expect me to agree with the deductions he drew in matters of fuel and power policy.

As for my right hon. Friend's speech, that was of a substantially higher order than his earlier speeches and those speeches delivered at the Dispatch Box by many of his predecessors. Today I am very largely in agreement with what he had to say about fuel and power policy.

The word "laissez-faire" has been used as one extreme of outlook in fuel and power matters, "planning" being the other extreme. I am not a supporter of laissez-faire in fuel and power matters, but I must say that I view with the gravest suspicion the clamant demands from the Socialist Party in the House of Commons and in the country, warmly supported by the Trades Union Congress and by the National Union of Mineworkers, for what they are pleased to refer to as a coordinated fuel and power policy.

It is not in my judgment a demand for a fuel and power policy that they make at all. All it is in my judgment is a demand for discrimination against a fuel, namely, oil, which is effectively competing with coal, notably in British industry. It is on that theme that I want to say a few words to the Committee.

My right hon. Friend did not place oil in the context of the contribution it makes to our balance of payments, and I wrote down what the hon. Member for Southwark said. He said that in the matter of balance of payments the position of oil was "not revealed."

Mr. Gunter

indicated assent.

Mr. Nabarro

I am glad that the hon. Gentleman agrees. I commend to him a well-known Government publication, The Accounts relating to Trade and Navigation of the United Kingdom, published on 28th January last. I invite him particularly to turn to Class "C" divisions 1 and 2, which cover mineral fuels and lubricants. He will find there that whereas coal and associated coal products, including coke, exported from the United Kingdom during the calendar year 1960 were valued at a modest £28 million, the value of exports of petroleum products was no less than £104 million.

It is not a matter of coincidence that, by their export achievements, petroleum and petroleum products contributed to this nation's balance of payments precisely four times as much as coal.

Mr. William Warbey (Ashfield)

As the hon. Gentleman has the document. I hope that he will quote the figures for the import of oil—both crude oil and refined products—during last year.

Mr. Nabarro

Of course I will. The hon. Gentleman is unduly precipitate. Of course I would not quote exports without quoting imports. The imports of coal were negligible. Glory be to God. [HON. MEMBERS: "Why?] Because in 1955 alone this nation dissipated a sum of nearly £80 million in hauling coal across the North Atlantic, and that had a disastrous effect on our balance of payments. Last year, largely because of the efforts of my right hon. Friend and his predecessors, coal imports were negligible.

Our exports of petroleum and petroleum products in 1960 amounted to £104 million. Our imports amounted to £148 million. There was a disparity between the two of only £44 million. I stress the word "only" for this reason. That import figure of £148 million was derived largely from British sources and British refineries wholly, or for a majority part, owned by British shareholders in foreign and Commonwealth countries, as, for example, the huge investment of British capital in Royal Dutch Shell and the fact that the Venezuelan oil fields today are a substantial British investment. That kind of investment has a profound bearing for the good and on the credit side of our balance of payments.

Mr. Ginsburg

The hon. Gentleman said a few minutes ago that my hon. Friend the Member for Southwark (Mr. Gunter) said that the oil position was not known. I think the critical point is that it is not known from Government statistics what is the true invisible position. We have listened to interesting sentiments from the hon. Member for Kidderminster (Mr. Nabarro), but I should be grateful if he would give the figure.

Mr. Nabarro

The hon. Member for Dewsbury (Mr. Ginsburg) is a little less accurate than usual. His hon. Friend the Member for Southwark did not say that the position of oil in the context of the balance of payments was "not known". He said that it was "not revealed". That is somewhat different. On visible account exports of petroleum products from the United Kingdom showed a deficit of the difference between £148 million of imports and £104 million of exports. Balanced against that disparity of £44 million are the earnings derived from huge British investment in refineries all over the world and on invisible account.

It is nearly impossible to separate invisible earnings as between shipping, insurance, banking and dividends, from direct investments. The Treasury itself could not do that. However, I hazard the estimate that there are hundreds of millions of pounds of British capital vested in the activities of British and largely-British oil undertakings overseas which, at even a modest return in the form of profits and dividends, yield to us a sum infinitely greater than the disparity between £104 million of petroleum products exported from this country and £148 million of imports

There is a second reason why oil should not be attacked; that is the delicate and finely balanced production structure of British refineries. No matter what the colour of the Government has been since 1945, a very high priority in the capital investment programme has always been the financing of British refineries in Britain and overseas. For a refinery to operate at the highest efficiency it must have a balanced output—first, of fuel oil; secondly, of aviation spirit; thirdly, of motor spirit; fourthly, of lubricants; fifthly, of greases; and, sixthly but not least, of petro-chemicals. If that balance is upset—petro-chemistry is a highly involved and technical study—it can have a most damaging effect upon our entire economy.

It is for those two reasons that I support a policy in fuel and power matters not by any means of laissez-faire, but of free competition between oil and coal. It is entirely fallacious for the National Union of Mineworkers, the Trades Union Congress and Socialist Members of Parliament to say that oil represents an import into Britain and therefore should be weighed in its economic value against indigenous coal. Were we not to import the vast quantities of oil that we bring in today it would be impossible for us not only to sustain our highly intricate and sophisticated national economy as we know it today, but to service, for example, the 8 million motor vehicles on our roads.

Mr. Michael Foot (Ebbw Vale)

Nobody is suggesting that we cut off oil altogether.

Mr. Nabarro

No, but the Socialist Party is suggesting that an artificial impediment should be placed upon the expansion of the oil industry in this country by the imposition of a tax. That would be most harmful to the future expansion and earnings of one of our major industries.

In this context not only my right hon. Friend's statement today but a statement made by the Paymaster-General in another place, which it would be in order for me to quote, is particularly apposite. Lord Mills said in another place on 26th October, 1960, speaking as a Cabinet Minister in the present Administration: …we produce in this country more fuel oil than we consume. Often an oil company is both an importer and an exporter of fuel oil, as in the case of other petroleum products. This is due to the complex structure of the international oil industry in which we have such a large share. If we take into account the fact that we depend upon the lighter oils for much of our road transport and for much of our agricultural requirements, we see that this in itself means that fuel oil is produced in increasing quantities. A little later the noble Lord said: This international oil business is a most complex structure; certain fuel oils are imported and certain fuel oils are exported. The moment the fuel oil comes into this country it becomes just the same as if it had been produced in the refineries, and is dealt with in the international trade."— [OFFICIAL REPORT, House of Lords; 26th October, 1960; c. 1137.] I suggest to hon. Members opposite that the recent visit by the representatives of the National Union of Mineworkers and the representatives of the Trades Union Congress to the Prime Minister, at which I am told that my right hon. Friend the Minister of Power was present, to try to persuade the Prime Minister to put an artificial brake or impediment in the way of the continued expansion and earnings of the British oil industry was ill-advised and certainly not calculated to help coal-miners and other sections of organised labour which the deputation sought to represent.

Another feature of the Opposition's case in these matters of fuel policy which is so odious is their utter inconsistency between major debates. On the 6th and 7th of this month we had an interesting two-day debate on financial and economic affairs. It was noteworthy that several leading spokesmen for the Opposition in party matters—party politics aside—notably the hon. Members for Grimsby (Mr. Crosland) and Birmingham, Stechford (Mr. Roy Jenkins), who are no mean economists in their own right, advocated increased competition for British industry and the quite essential feature, as they argued, that Britain must enter the Common Market at an early date.

If we entered the Common Market, what would be the position of our coal industry? It would have none of the protection that it enjoys today. The protection it enjoys today is that my right hon. Friend the Minister of Power, who is responsible for all fuel and power production and co-ordination in Britain, protects the coal industry by assuring arrangements which make it unnecessary to import coal. If we were members of the Common Market, could we any longer do that? We would be part of the iron, steel and coal communities, for that is an essential part of Common Market arrangements, and then Polish and West German coal—Polish coal because it could be re-exported through Common Market countries—would undermine the market for British coal in our own industries.

No qualification was made by the hon. Member for Grimsby or the hon. Member for Stechford as to special protection for the British coal industry if we joined the Common Market. It must be remembered now that our costs of coal production have gone far ahead of the costs of coal production in the Common Market countries.

Hon. Members opposite often call in aid the Guardian, for it invariably portrays many of their own Left-wing tendencies. I prefer the Daily Express, but that is only a personal preference. I want to quote the leading article in the Guardian of 15th February by Georg Tugendhat, a well known fuel technologist, formerly the managing director of Manchester Oil Refineries.

Mr. M. Foot

The hon. Gentleman referred to a firm which went broke.

Mr. John Harvey (Walthamstow, East)

rose—

Mr. Nabarro

If my hon. Friend will allow me, I will deal with the hon. Member for Ebbw Vale (Mr. M. Foot) in my own way. The hon. Member for Ebbw Vale said that Manchester Oil Refineries was a firm which "went broke". On the contrary, Manchester Oil Refineries is very much alive and is a thriving firm—in Manchester, as one would suppose. It has done very well in petro-chemicals in the last few years. In fact, my hon. Friend the Member for Walthamstow, East (Mr. J. Harvey) is a distinguished servant of that company, and no doubt rose to support those facts. The hon. Member for Ebbw Vale may know about the Fabian Society, but what he knows about British industry could be written on the back of a 3d. stamp.

I was about to quote Georg Tugendhat—I never come to debates, I remind the hon. Member for Ebbw Vale, without looking up the impeccable character of the references which I call in aid—Doctor of Laws, Vienna; Master of Science, London School of Economics—that should appeal to the hon. Member; formerly managing director, Manchester Oil Refineries; Governor and Fellow of the London School of Economics; Fellow of the Royal Economic Society; many contributions on economic, financial, and fuel and power matters.

I was saying that our coal prices, given a free market with Common Market countries, would be uncompetitive. The quotation from the Guardian is: Following the latest increase in coal prices by about 8s. to 10s. a ton in Britain, the cost of electricity, gas and transport has been raised. The Central Electricity Council has stated that the rise in coal prices has increased the cost at the generating stations alone by over £10 millions, and further price increases for electricity have been announced. The steel industry, where a change of £1 in the price of coal means £2 on the steel price, is expected to increase its prices by 25s. to 35s. a ton. The operative words of critical importance to the Committee are: We are the only major industrial country at the moment in which energy prices have not only failed to come down but are actually rising. I will give the article to the hon. Member for Ebbw Vale.

Mr. M. Foot

I have read it.

Mr. Nabarro

I am sorry. The hon. Member should, therefore, know better.

It is all of a pattern. It is indubitably the fact that energy prices have fallen in Common Market countries while in Britain they have been steadily rising. I commend to the Committee particularly what my hon. and gallant Friend the Member for South Fylde (Col. Lancaster) said about the high price of coal which is causing, and will undoubtedly cause in future, further weakening of our coal position by competition from oil.

The coal industry in Britain today is not in an entirely healthy condition. There is a great deal wrong with it, financially and otherwise. It is very unpopular among the consuming public. I hope that no hon. Member will suppose that the National Coal Board is among the most popular of our industrial organisations.

Certainly it has had a great deal with which to contend—many vicissitudes and many tribulations in the last few years—but one major reason why more and more consumers of fuel in this country are changing to oil from coal is the inconsistency in quality of the coals which they wish to employ, or the high price, or the fact that a lot of rubbish is often supplied to the domestic market and erroneously called coal.

Mr. Swain

Can the hon. Member for Kidderminster (Mr. Nabarro) tell the Committee why on no occasion since the return of a Conservative Government in 1951 he or any member of his party, from the back benches or the Government Front Bench—and the order in which I put them will be observed—has recommended the denationalisation of the coal mines in the interests of the nation?

Mr. Nabarro

I am grateful to the hon. Member, but I am sure that he has not heard me speaking in many coal debates.

Mr. Swain

I have, too many times.

Mr. Nabarro

Too many times? The fact that my views do not readily commend themselves to the hon. Member, who has a vested interest in the coal industry and—

Mr. Swain

Declare yours in the oil industry.

Mr. Nabarro

—in the National Union of Mineworkers—

Mr. Swain

Declare yours in the oil industry.

Mr. Nabarro

—does not in any way detract from the veracity of what I am saying.

Mr. Swain

Declare yours in the oil industry.

The Temporary Chairman (Sir Norman Hulbert)

Order. The hon. Member for Derbyshire, North-East (Mr. Swain) must not tell me to declare my interest in the oil industry or anything else.

Mr. Nabarro

I will reply to that last jibe of the hon. Member, for jibe it was. I have no interest direct or indirect—

Mr. Swain

On a point of order. You brought me to order, Sir Norman. May I now bring the hon. Member for Kidderminster to order? He stated categorically that I had an interest in the coal industry. All I did in return was to ask him to declare his interest in the oil industry.

The Temporary Chairman

That is not a point of order. What the hon. Member did was to ask me to declare my interest.

Mr. Nabarro

As always, Sir Norman, I am deeply indebted to you for your protection.

I said that the hon. Member had a vested interest in the coal industry. He is notoriously a member of the National Union of Mineworkers, so of course he has a vested interest. He asked me to make a declaration of my interest, which I do with the greatest happiness and enjoyment. I have no interest, direct or indirect, in the oil industry. I even sold my oil shares so that a jibe of that kind could not have any substance. I am not yet a Minister of the Crown, so there was no absolute need for me to sell. [HON. MEMBERS: "Make a packet?"] Yes, I made a packet.

Mr. Joseph Slater (Sedgefield)

The hon. Member has drawn our attention to the way prices of British coal have increased and has compared that with what has happened on the Continent. Will he give the other side of the picture and tell the House what is the price of coal on the Continent against British coal?

Mr. Nabarro

That would involve me in a lengthy statement. I will return to it if the hon. Member wishes, but I was at the point of saying that the condition of the British coal industry was not entirely healthy and I give a variety of reasons for it. There are a number of things which I hope Mr. Alfred Robens will do—

Mr. Ernest Popplewell (Newcastle-upon-Tyne, West)

rose—

Mr. Nabarro

No, I will not give way. The hon. Member for Newcastle-upon- Tyne, West (Mr. Popplewell) has just taken his seat after standing below the Bar. He was not in his place or anywhere else in the Chamber when I started speaking. I do not mind giving way to regular participants in these debates, but not frivolously to anybody who cares to rise.

Mr. Popplewell

On a point of order.

Mr. Nabarro

I said "frivolously".

Mr. Popplewell

On a point of order. Has the hon. Member any right to suggest that interventions are frivolous when he does not know what they are? My point of order is that I was present when the hon. Member quoted British coal prices against Continental prices. I think that in justice to the Committee he should quote Continental pithead against British pithead prices to justify his argument.

Mr. Nabarro

I am glad, Sir Norman, that you treat that intervention with the disdain it deserves. Perhaps I may now continue my speech and—

Mr. Charles Pannell (Leeds, West)

On a point of order. The hon. Member for Kidderminster (Mr. Nabarro) is patently not in order when he attempts to attribute to you, Sir Norman, statements which you did not make. He suggested that you treated my hon. Friend the Member for Newcastle-upon-Tyne, West (Mr. Popplewell) with disdain. In fairness, you did not do that, and, as a matter of fact, it is patently out of order to attribute motives to the Chair and I hope that you will ask the hon. Member to withdraw that statement.

The Temporary Chairman

I must say that I did not regard it as unnecessarily offensive.

Mr. Pannell

It is not a matter of whether you considered it offensive or not, Sir Norman. It is a matter for the Committee, as to whether you will allow hon. Members to attribute motives to you, not what you think. It is that that the hon. Member did.

The Temporary Chairman

The mere fact that I did not answer the hon. Member for Newcastle-upon-Tyne, West (Mr. Popplewell) does not mean that I treated him with disdain.

Mr. Pannell

Withdraw.

Mr. Nabarro

Silence is golden, in the Chair as elsewhere. I am here to make contributions to debates.

Mr. Sydney Silverman (Nelson and Colne)

Why do you not?

Mr. Nabarro

If the hon. Member for Nelson and Colne (Mr. S. Silverman) will allow me to continue, I will answer some of the points which have been put to me.

I said that the coal industry was not in a particularly healthy condition, and a number of matters urgently demand the attention of Mr. Alfred Robens, the new Chairman. First, in the context of what was said by my hon. Friend the Member for South Fylde, Mr. Robens must enforce drastic economy and start right at the top in Hobart House. Bureaucracy there is violently overloaded, and the fewer administrators there are at the centre and more and more devolutionised the organisation is, the more effective will the whole organisation ultimately prove to be.

Second, Mr. Robens must restore the power and spirit of independence of the colliery manager within commercially viable areas, not the stodgy administrative pudding which we have as a Coal Board today.

Third, Mr. Robens would do well to fight bureaucracy and instil the profit-earning habits of private industry into the National Coal Board. [An HON. MEMBER: "Cheap coal."] Socialist Members dislike the word "profits". They conveniently omit the fact that the estimated loss forward of the National Coal Board to 31st December, 1960, is £70 million. I would have the Board as a profit-earning undertaking, not as a loss-making nationalised industry.

Fourth, I would ask Mr. Robens to impress on all his executives at every level that their first duty is to give value for money, good and consistent coal quality—not dirt and rubbish.

The fifth point is to reduce prices to sell coal, not to increase them.

The sixth requirement is to avoid oil competition by demonstrating that British coal, and gas, coke, electricity and steel made from it, is best.

The seventh is to rebuild Britain's coal exports by aggressive selling in Western Europe and elsewhere.

The eighth is to make friends with the private enterprise coal merchants and the co-operatives—for what hon. Members opposite always conveniently forget when they advocate nationalisation of the coal distributive trade is the fact that one of the largest coal merchants in Britain today are the co-operatives. The National Coal Board should make friends with the merchants by giving them service and help, for it is the merchant in the ultimate who will popularise the sale of coal in competition with oil.

The ninth requirement is to encourage the use of modern boiler-house equipment and appliances to burn coal and coke efficiently, economically and smokelessly. [Interruption.] Did somebody say "Ghastly"? To the hon. Member who appears to be confirming his intervention, I will repeat my last few words—

Mr. Charles Loughlin (Gloucestershire, West)

Nobody said "Ghastly".

Mr. Nabarro

The Coal Board should encourage the use of modern boiler. house equipment and appliances to burn coal and coke efficiently, economically and smokelessly. That has been a statutory responsibility of every Minister of Fuel and Power since 1945. It was the means of propelling through this House, with all-party support, the Clean Air Act of 1956, overwhelmingly supported by Socialist Members. So the hon. Member who says, "Ghastly" is surely a heretic.

Tenth, Mr. Robens should note that when he offers summer price rebates for winter coals he should deliver the coals promptly in the summer time and not forget to do so. I know of nothing in the minds of the general public which so unpopularises the affairs of the National Coal Board as the failure to deliver house coals when rebates in price are offered in the summer time. I was inundated in 1960 and the year before that with complaints of that kind.

Eleventh and lastly, Mr. Robens should tell the coal miners quite bluntly that "enough is enough" and that any more price increases resulting from higher wages can only put the coal miner and his mates out of a job.

If Socialist Members want a policy for coal, there are the eleven points. That is what Mr. Alfred Robens, as Chairman of the Coal Board, should adopt as his policy, and when hon. Members opposite read it in cold print tomorrow and perhaps go away and give it a second thought they will realise that I am not very far removed from the truth. Furthermore, I am not very far removed from the policy which, if Mr. Robens' statements in this House when he was on the Opposition Front Bench are any guide, may well lead to the redemption—I use the word advisedly—of the financial affairs of this basic industry.

I want to say a word about house coal supplies in the last few months. The Parliamentary Secretary vigorously defended the National Coal Board on the 6th of this month and proclaimed that there was no widespread shortage of house coal. I sit for a Midlands constituency, a highly industrialised constituency in Kidderminster. My hon. Friends who also sit for Midlands constituencies were clamant in their protest about the shortage of house coal, notably due to the difficulties of householders in a winter when we had had a very great deal of rain—almost endless rain for several months. There were my hon. Friends the Members for Wycombe (Mr. John Hall), for Shrewsbury (Mr. Langford-Holt) and for Coventry, South (Mr. Hocking) who all complained. The hon. Member for Birmingham, Ladywood (Mr. V. Yates) complained. So did others, including myself. I do not know what the position is with house coal supplies in County Durham or in South Wales. No doubt, supplies there are assisted by substantial tonnages of miners' concessionary coal, but in the Midlands we got too little house coal.

It is manifest nonsense for the Parliamentary Secretary to come here and say that there is no shortage of house coal. I think he qualified that by saying that there was no widespread shortage of house coal. He evoked from the newspapers in the Midlands a very hostile reception to what he said. I think he ought to be informed of this.

The Coventry Evening Telegraph on 7th February reported: M.P's angered by Coal Shortage Statement. The coal shortage in many Midland towns has provoked angry reactions from both Conservative and Labour M.P.s. Last night they were blaming the Government for refusing to take the shortage seriously. The Birmingham Post on the following morning, 8th February, said: It is true that shortages have varied from district to district, and that not all consumers have been inconvenienced. But a great number have. Mr. Nabarro referred to the 'number of complaints' coming in from Midland towns. Mr. Yates spoke of thousands being unable to stock up for the winter. One recognises the difficulties the Board has to contend with and Mr. George"— that is the Parliamentary Secretary; I am not being impertinent to him— may well be right in saying that it is doing its best. But is that best good enough? Coal is a nationalised industry. It is natural that consumers should ask their M.Ps. to look after their interests when things go wrong. It is unsatisfactory if, when Members quote specific cases, they are told that these are not a matter for the Minister; and just as unsatisfactory if. when they give evidence of widespread shortages, they are told they are not widespread enough to be considered general.

Mr. Edwin Wainwright (Dearne Valley)

Will the hon. Member agree that, during the last two years, distributors have had their stocks down by two or three million tons and, had they taken the stocks to distribute to the consumer, there would not have been the shortage that there is today?

Mr. Nabarro

I am not sure that the hon. Member is correct.

Mr. Slater

The hon. Gentleman should check up to see whether my hon. Friend is right in what he says.

Mr. Nabarro

I am about to go into that. With his customary generosity, my right hon. Friend sends to me weekly a document called the "Weekly Statistical Statement of the Ministry of Power". I always do my homework before I speak in the coal debate.

Mr. Wainwright

I know the document. That is quite all right.

Hon. Members

Get on with it.

Mr. Nabarro

If hon. Members will stop interrupting me. I will answer the hon. Member for Dearne Valley (Mr. Wainwright). He says that the domestic coal shortages to which I referred arose because merchants have run their stocks down. That is his case, in effect. The merchants have not run their stocks down. Their distributed stocks, that is to say, stocks in the hands of the merchants—I quote the most recent figure of distributed coal stocks totalling, on 6th February, 1961, no less than 12,850,000 tons, including distributed stocks of the electricity industry, the gas industry, coke ovens, industrial companies, the railways, iron and steel, merchants and the rest. [HON. MEMBERS: "0h."] Yes, and that figure is actually higher than the comparable figure a year earlier.

Mr. Wainwright

rose

Mr. Nabarro

No. I have given way too much.

Mr. Harold Finch (Bedwellty)

rose—

Mr. Nabarro

Once more then. I am a very patient chap.

Mr. Finch

Does the hon. Member realise that the position is likely to become worse unless we get more men into the industry?

Mr. Nabarro

Perhaps the hon. Member will allow me to continue. I have not yet dealt with manpower, but I will do so, if necessary. What I am saying is that distributed stocks of all coal at over 12 million tons are higher than they were at this period last year.

Mr. Wainwright

Evading the question.

Mr. Nabarro

The plain fact of the matter is that there is a grave and widespread shortage of domestic or house coal. Nothing that the Parliamentary Secretary says can gainsay that. It is manifest nonsense for him to come here, as he did on 6th February, and deny that we have a shortage of house coal in the Midland towns. The Severn Valley has been very largely flooded in the last few weeks and thousands of houses have been affected by inundation. Those houses can be dried out only if there is available a ready supply of house coal. It is no longer good enough for either the Minister of Power or the chairman of the National Coal Board to say loftily from their respective Olympian heights that it is the duty of the householder to put domestic coal into stock in the summertime for the winter months.

Today there is a buyers' market for all fuels, industrial and domestic. The only time that the summer stocking scheme worked was where there was a seller's market. There is today a complete reversal of the position. It is the duty of the coal industry, and notably of the National Union of Mineworkers, to see that the large coals so plentifully available and suitable for the house market in this country are not needlessly broken up by the indiscriminate use of explosives and other methods and to ensure that a highly valuable market for the products of the coal industry, the house coal market, does not go unfulfilled. If there is another winter like this one, when so many households in this country have been bereft of coal, yet more people will switch to oil.

Mr. Stephen McAdden (Southend)

I have never interrupted my hon. Friend in a speech before. I have listened to all his speech today with great interest, and with a great deal of what he says I agree. It is no part of my task to defend the Parliamentary Secretary, and I should not attempt to do so, but will my hon. Friend explain why, if there is this widespread shortage of house coal, the stocks of house coal are nevertheless greater in their distribution than they were last year? Does it not necessarily follow that what he is complaining about is the lack of stocks held in distributors' hands in the Midlands area?

Mr. Nabarro

That may well be the case. I did qualify what I said by referring to the fact that my experience was in the Midlands towns. Things may be different in County Durham or South Wales, but in the Midlands towns we have little house coal. It is the responsibility of the Minister, the National Coal Board and the National Union of Mineworkers to put that right.

I come now to the Clean Air Act, 1956, and its implementation. We are notoriously deficient of solid smokeless fuels other than gas coke. During the last few months, a Midlands borough, Solihull, applied for the extension of smokeless zones, or, as they are called smoke control areas. The Minister of Housing and Local Government grants the word, but then the local council finds that it is impossible to implement it because nothing but gas coke is available as a solid smokeless fuel and householders will not readily use gas coke.

My right hon. Friend will recall that the Beaver Report said that to deal with the "black" areas of this country 19 million tons of solid smokeless fuels would be required. The Minister proposes to provide by 1965 only 12 million tons. The deficiency in solid smokeless fuels is now so great as to largely negative the effect of the Clean Air Act and the need for expansion of smoke control areas in all parts of the country. It is the responsibility of the Minister to see that the Coal Board supplies adequate quantities of solid smokeless fuels.

What is the Coal Board doing about it? It has maintained an expensive research organisation known as Stoke Orchard for the last 12 months or more. Whenever I raise the matter in the House, I am told that large quantities of solid smokeless fuels will shortly be forthcoming from National Coal Board sources. They are now affectionately referred to as "Bronowski bullets" because Dr. Bronowski is the head of the research organisation, not the production organisation. As yet, no Bronowski bullets have made their appearance on the market. The result is that the implementation of the Clean Air Act is being held up all over the country.

It is quite insufficient for my right hon. Friend the Minister of Power to say that, before the Minister of Housing and Local Government gives his consent, after consultation with the Minister of Power to a new smoke control area, he satisfies himself that sufficient supplies of solid smokeless fuels are available. He means gas coke, but the householder dots not want to burn gas coke on an open fire. The householder wants a premium fuel, and this demand the Coal Board should have been capable of supplying long ago.

There are grave deficiencies in the Coal Board organisation, first, because it has failed to supply adequate quantities of domestic or house coal, and, second, because it is failing to match its second great potential market, the market for solid smokeless premium fuels.

In three-quarters of my speech, I have warmly supported my right hon. Friend. In the last quarter, I have criticised him and his Parliamentary Secretary. I hope that before we debate fuel and power again, there will be no further complaints from the Midlands or elsewhere concerning shortage of house coal, for there should not be in present circumstances, with the Coal Board pressing to sell more and more output every year. Secondly, I hope that the complaints will end in relation to solid, smokeless premium fuels by the Coal Board launching at an early date the very long promised new product, the "Bronowski bullet", as it has become so affectionately called in the last few years.

6.31 p.m.

Mr. Thomas Swain (Derbyshire, North-East)

Sitting on these benches so long and listening to the gastronomical rumblings, both in and out of the debate, of the hon. Member for Kidderminster (Mr. Nabarro) reminds me of a little boy who used to go to my school. He had the biggest boots in the school, and when asked why he wore the biggest boots in the school he always said that he had the biggest feet. It is fairly obvious to me from these benches why the hon. Member for Kidderminster has the biggest moustache in this House.

Mr. Ellis Smith (Stoke-on-Trent, South)

Is the hon. Member for Kidderminster (Mr. Nabarro) listening?

Mr. Nabarro

Very poor stuff, I think.

Mr. Swain

The hon. Member for Kidderminster, in his long and very ragged contribution to this debate, said that I had a vested interest in the coal mining industry. I hereby declare my interest in the mining industry. It is in the lives of three sons and two sons-in-law, who work at the coal face in this great industry. That is the vested interest which I, as a Member of Parliament, have in the coal mining industry—not only the lives of these sons and sons-in-law, but of their families and their children-to-be, which are vested in the future of the mining industry. At no time will they leave the mining industry, unless they are forced to do so by economic circumstances.

I too have passed through a phase of life extending over the past 35 years in the mining industry until coming here, and I saw what the Tory Government's policies towards the miners were from 1925 onwards.

Mr. Nabarro

A congratulatory telegram.

Mr. Swain

The hon. Member for Kidderminster has just received a message. It is probably a congratulatory telegram to himself from Wormwood Scrubs.

Mr. Nabarro

On the contrary, it is a testimony to the efficiency of the General Post Office.

Mr. Swain

I know right up to date what is passing through the minds of the miners, being discussed in the branch meetings, the council chambers or the National Executive of the N.U.M. Great concerned is being expressed in these bodies as to what the future of our great industry is to be. We have experienced a black past in our industry, and, fortunately, the members of the N.U.M., of which I am a very proud one—the hon. Member for Kidderminster never has been one, and therefore cannot speak from experience on that score—are very concerned about what is to happen unless the Tory Government give us a coordinated fuel plan.

I contend that the Minister of Fuel and Power and the Government have a particular obligation to this country to give us a co-ordinated fuel plan, and it should be co-ordination and not competition, because it is out of competition that we can get chaos in the coal industry and in the overall economy of the country. I hope and trust that, when the Parliamentary Secretary comes to reply, he will be able to give us some information about what is running through the mind of the Government towards a coordinated fuel policy.

One would have thought that, having satisfied the country's requirements after years of exhortation to do better and to work harder, the industry would have been rewarded with a reduction in hours, an additional week of paid holidays or maybe a compensatory payment for the loss of Saturday work, which hits the lower-paid men severely; but nothing like that at all has occurred. The obvious reason is that this Government would not allow it. In spite of protests and suggestions for a modern fuel policy by the N.U.M., the Government instead introduced a policy of cuts and closures, and now we read that parts of the country are desperately short of coal. I will deal with the complaint of the hon. Member for Kidderminster about the shortage of house coal and give what, to my mind, are the root causes for that shortage, in a moment or two.

It is all so simple to some people—"Chuck them on the scrap heap in 1957 and drag them off in 1960." That is what the Government have done to the coal miners. I suggest that there is no basic industry in this country which can be operated on an economy of boom and slump, on which the Tories have been running this country in the past few years. The National Coal Board cannot plan for the mining industry to turn 200 million tons in 1960 and only 186 million tons in 1961, and perhaps have to go back to 200 million tons in the following year. There has to be co-ordination and planning inside the Coal Board at all levels, and faces cannot be worked and pits cannot be planned unless this planning is done over a long term.

What the miners consider should have been their greatest reward was that the Government should have formulated a plan for fuel which would have guaranteed social and industrial security for the miners and their families, and that is the view which is running through the minds of the mineworkers today. They tell us that they have been let down tremendously by the Tory Government—the same Government which exhorted the miners and the National Coal Board to produce coal at a loss because it was in the interests of the country. What has happened? The moment that we turn the corner and start to go downhill, the mineworkers and the industry are to be placed on the scrapheap, with the full co-operation of hon. Members opposite.

To deal with the points made about the shortage of house coal by the rumblings of the hon. Member for Kidderminster, the Coal Board had to introduce into the coal pits some time ago a concentrated scheme of mechanisation. In the pit where I last worked, we introduced a machine and I worked on it. It would frighten some hon. Members to death to see it. In the cutting head of this machine there are 457 cutting picks, and the chain in this cutting head was going round at 200 revolutions per minute. It was cutting a seam of coal 7 ft. 4 ins. thick from floor to roof, and the coal produced by that machine in bulk tonnage was considerably less in size than that of the coal required for house coal. That inevitably had to be, because when this machine was produced and first introduced into the pit there was a great cry for coal. The installation of that machine at one coal face cost the National Coal Board £58,000. If the Board had to scrap that machine overnight in the interests of large coal production it would lose that sum of money. That machine is still working and is producing—this will be very interesting to the hon. Member for Kidderminster who criticised the English coal mining industry and compared it with that of Germany—l0.9 tons of coal per man shift, a tremendously high output per man shift of which that pit is rightly proud.

Another reason why there is a shortage of house coal is that, owing to Government policy of closures and economic cuts, the Coal Board has had to close uneconomic units. They were uneconomic only because they could not be mechanised in order to grind the coal almost into powder and produce a very high tonnage. These pits were producing by hand-got methods by far the highest quantity of large coal. That is a point which hon. Members opposite do not appreciate. This was coal which was mined by hand-got methods which we consider in the East Midlands as obsolete because of our rich seams—and thank God they are obsolete because of the arduous nature and danger of the task which has to be performed in mining this coal. These were the pits classed by the Tory Government and by the supporters of the Tory Government as uneconomic units because they took quantity instead of quality as the yardstick. I therefore contend that it is largely owing to Government policy right along the line that [there have been local shortages of house coal.

In contradiction to the hon. Member for Kidderminster, who has so indecently left his seat before the Member following him finished his speech, and in spite of the bleatings of the sheep and the rumblings of the "Wild Bull of the Pampas" opposite, there has never been during the last twelve months an acute or widespread shortage of house coal. I am sure that hon. Members on this side of the Committee who know anything about the mining industry will defend the Coal Board to the last letter on that score.

I have some very interesting figures, which will astound the hon. Member for Kidderminster—who no doubt will be in the Smoke Room at this moment—to compare the efforts of one division of the mining industry with that which was so loudly quoted. I admit that the division about which I want to speak, the East Midlands, has geological advantages over most other divisions. We in the East Midlands do not claim to be supermen. We merely claim to have the best geological conditions for the mechanisation of coal-getting. I will not quote all the figures, because many hon. Members wish to speak, but the overall saleable output in 1960 in the East Midlands division was 44,059,000 tons, a planned decrease compared with 1959 of 718,000 tons.

I can never understand why we should set targets in an extracting industry provided that industry is playing its right and proper part in an expanding economy instead of in a Tory contracted economy. The most important figure is the one relating to output per man shift. The output per coal face worker for 1960 in the East Midlands was 119.2 cwt. I challenge any division in any country to produce under the same conditions a higher output per man shift than the East Midlands achieved in 1960. That was an increase of 7.2 cwt. over 1959.

Hon. Members can see that we in the East Midlands are an expanding industry internally, but we are having to work inside an overall generally contracting economy. Inevitably, this means that in the not too distant future we will again have to suffer a reduction in manpower, thereby creating social problems in and around the mining areas in order to maintain our target of 44 million tons. If we maintain the same number of men in the East Midlands division and keep expanding our output per man shift by 7.2 cwt. annually but are allowed to turn only 44 million tons of coal, inevitably manpower has to be reduced in the not too distant future. When that happens and when men are made redundant only the people who reside in the mining areas understand the social problems which are created. In an expanding division like the East Midlands there should be no need—and it is criminal neglect on the part of the Government if there is need—for men to have to uproot themselves and their families from their homes and to have to go to other parts of the country. It is a social problem for which the Government are responsible and of which the Government should take cognisance.

From 1946 to 1960, the overall output in the East Midlands division—I quote these figures because of the statements of the hon. Member for Kidderminster—has risen by 42.1 per cent., an astronomical rise in output under any circumstances. This is the answer to the carping critics on the benches opposite who, if they were doing a crossword and the clue was "Manual labour". would put down "Spaniard".

The Tory Party is the sworn enemy of nationalisation. Time and time again it has declared that under no circumstances will it "wear" nationalisation. Even at the expense of the economy they will go to the bitter end in their attempts to denigrate nationalisation. By not fulfilling their obligations to this nation in formulating a co-ordinated fuel policy, the Government are doing everything in their power to denigrate the mining industry as an instrument of torture against nationalisation. I accuse the Minister of Power and the Parliamentary Secretary and every Member of the Government, from the Prime Minister downwards, of sabotaging the economy by sabotaging its basic industry, coal mining.

I hope that when the Parliamentary Secretary replies to the debate he will have something constructive to tell us. It may be that there is someone on the benches opposite with a little more thought than the hon. Member for Kidderminster. All I can say is that it was a good job that the Prime Minister was not present, otherwise, no doubt, he would have moved the hon. Member to the Front Bench to take the place of the Parliamentary Secretary and put the Parliamentary Secretary back in the place of the hon. Member for Kidderminster on the back benches. The hon. Member imagined that he was putting forward a wonderful plan. We were discussing the elementary stages of that kind of plan in the primary school in 1914.

I hope, therefore, that we shall hear something from the Government. If they need any help—and, heaven knows, they do at this moment—I refer them with all sincerity to the plan which has been so thoughtfully worked out by the Trades Union Congress, the Labour Party and the National Union of Mine-Workers. It is a plan of which we on this side are justifiably proud. If we were in Government—it is to the detriment of the nation that we are not—we would implement that plan without hesitation, because we know that if the mining industry is allowed to be wrecked, there cannot possibly be any hope for the economy of our great country.

6.53 p.m.

Mr. John Harvey (Walthamstow, East)

I will not follow the hon. Member for Derbyshire, North-East (Mr. Swain) in some of his wilder remarks. We could all cheerfully throw party political badinage around the Committee indefinitely, but I doubt whether it would advance the cause either of the miners or of the sensible power policy, which many of us, on all sides of the Committee, would like to see pursued.

My interest in the oil industry has already been declared for me in an exchange between my hon. Friend the Member for Kidderminster (Mr. Nabarro) and the hon. Member for Ebbw Vale (Mr. M. Foot). I hope that the hon. Member for Ebbw Vale will accept from me that his imputation about the company with which I am connected was wildly inaccurate and that it is, indeed. a prospering little concern.

Mr. M. Foot

If I have made a mistake in the name of the company, certainly apologise.

Mr. Harvey

I thank the hon. Member.

I should like to touch upon one or two aspects that might help a little among some of the things that have been said today. From both the hon. Member for Southwark (Mr. Gunter) and the hon. Member for Aberdare (Mr. Probert) we had alarmist statements about the possibility of the world's supplies of oil running out by the end of the century or within a few years thereafter. It should be made abundantly clear that the proven reserves of oil in the world today are more than forty times the annual off-take of oil by all sorts of consumption.

It should be added that for more than a decade it has been the annual practice of the oil industry to add more to the proven reserves than is subtracted from them. In other words, the amount of proven reserves has increased from year to year and there is every reason to believe that it will continue to do so. It is, therefore. relevant to say to both the hon. Member for Southwark and to the hon. Member for Aberdare that at least one eminent petroleum geologist has recently suggested that the world's resources are good enough for at least 2,000 years to come. That puts us a little further ahead than the end of the century or a few years after then.

Mr. John Hynd (Sheffield, Attercliffe)

The hon. Member mentioned that the reserves have increased year by year, although consumption has risen. Is it not the case, however, that the curve, which went upward regularly until last year, has now begun to move downwards, and that the amount of increase in the reserves is becoming less?

Mr. Harvey

That may be the fact at this precise moment, but one cannot talk about a curve that went upwards until last year and then turned downwards and suggest therefrom that it has turned downwards for ever. My point is still valid, that at least one eminent petroleum geologist has claimed that the reserves are good enough for 2,000 years to come. The hon. Member for Southwark will agree that that is not exactly bringing the next generation or so into question when we talk about the availability of reserves.

Mr. Probert

Can the hon. Member reconcile those remarks with authoritative sources in America, which state that in 1960-65, or, to be more optimistic, in 1975, American production will have reached its peak and will not be able to meet American needs?

Mr. Harvey

What the hon. Member overlooks is that production in America is prorated. It is not the full amount that could be produced if America went flat out. Production is deliberately limited. I do not know the figure in Texas, for example, at this moment in time, but for many years the figure which has been maintained has been between nine and twelve days' production per month. What the Americans could produce in an emergency if they decided to go flat out is something quite different. It is important, therefore, not to confuse ourselves between these two different sets of figures on completely different bases.

The hon. Member for Southwark also talked about the balance of payments and suggested that there might be a deficit of as much as £100 million due to the import of oil. That was adequately dealt with by my hon. Friend the Member for Kidderminster. It is, however, also important to bear in mind the tremendous sums of money that are spent here in various ways, not only by oil companies which build up sterling balances in Britain but by oil countries—for instance, in the Middle East and Venezuela—which build up sterling balances, too, and buy goods and services of one sort and another here and who, not least, have contributed considerably to our shipbuilding industry over the last few years in the tankers which have been ordered here. We all hope that this will continue in the years ahead. One must, therefore, take a great many factors into consideration before talking too easily about the importation of oil being a cost to the national economy.

I should like now to speak of the size of the problem. A number of hon. Members opposite have talked about oil as though it is something that competes seriously with coal and as though there is, therefore, an urgent need to do something to limit importations of oil in the interests of our domestic coal industry. The amount of gas oil, diesel oil and fuel oil delivered into consumption in this country suggests that not more than, at most, 9 to 12 million tons of coal could be saved for the coal industry if every possible source now using oil was compelled to use coal.

If, therefore, it is realised that we are talking of 9 to 12 million tons coal equivalent in a coal industry which produces about 200 million tons per annum, the size of the oil versus coal argument is reduced to something like its correct perspective. Surely it is of the utmost importance that we should endeavour to produce as efficiently as we can, and to maintain as efficient an economic machine as we can, throughout our industry.

We have debated on a number of occasions in the House over recent weeks the need to export more, the need to make ourselves more efficient, yet if we were to adopt the suggestion put forward in the leaflet "Fuel and Power; an Immediate Policy", issued by the Labour Party and the trade unions last year, and adopt the policy of putting a tax of lid. per gallon on fuel oil, the net result would be to clamp a tax of 20 per cent. on the cost, for instance, of the fuel oil at present used by the steel industry.

In other words, it would be adding an appreciable burden to the cost of producing steel at a time when it is of the utmost importance that we should avoid adding any more than is absolutely necessary to costs such as these.

Mr. William Blyton (HoughtonleSpring)

The Conservative Government, in 1935, put a 1½d. gallon tax on oil to protect coal when the coal owners had the coal industry.

Mr. Harvey

I am aware that this may have been done in 1935. I am suggesting that it would be an exceedingly unwise thing to repeat the experiment in 1961. To add this burden to our steel industry at the present time would send prices up.

There is no question about that, and it would add to the burden which the whole of industry has to bear, because it follows that when the price of steel goes up many other costs begin to follow it up at once. Of course, the rise would not be confined to steel production. If we say that the oil industry should find ways and means of not passing on the cost or of absorbing the tax itself, we have still defeated the object of trying to force the price of oil up nearer to the price of coal. We cannot try to rule the economy in that way. It would be madness deliberately to try to make fuel oil less competitive because coal is not sufficiently competitive in present circumstances.

I would say to hon. Gentlemen that it is important to bear in mind that there are many hon. Members, when we are talking about trading difficulties today, who would still say that one of the answers to our trading difficulties is to open still wider the prospects for East—West trade. Yet, if we accepted that formula and allowed the Soviet Union to ship to this country all the petroleum products that that country undoubtedly brings considerable pressure on my right hon. Friend to admit to this country, then fuel oil prices today would be debased even further and the difficulties of the coal industry enormously increased as a result of that step. This is a serious matter that needs to be borne in mind.

I give way to no one in my desire to see this country pursue a sensible fuel policy. I agree with the hon. Member for Derbyshire, North-East that the miner is entitled to know where he stands in the context of this fuel policy which we must feel our way towards. I do not subscribe to the belief that coal should be allowed to go to the wall if it cannot make itself efficient in terms of prices, because it is the only indigenous fuel that we have and, therefore, I think that it has an appreciable strategic value from our point of view if nothing else. We should remember that.

Coal must, therefore, continue to play a most important part in our economy. It has been suggested that about 200 million tons per annum might be the right sort of mark for the future of the coal industry. I suggest that over and above that there should be free competition between the coal and oil industries because for so much of our economy they serve different needs and there is no doubt that oil can in many ways give us an efficiency and an economy in industrial production which we might not otherwise be able to get, and a degree of cleanliness, too, that is important.

Mr. Wainwright

If the hon. Member is so confident that competition should continue between oil and coal, would he agree that the oil industry ought to be responsible to the Government for the amount of money which the Government are paying for bulk storage oil, which is about £7.9 million per year?

Mr. Harvey

That depends on the reason for which this bulk storage is taking place. It must be remembered that the industry itself finances a considerable amount of bulk storage. If the Government bulk storage were for completely strategic purposes not immediately connected with the industry, I would not subscribe to that argument.

I think that the place of coal must be recognised in the future of our economy and that we must, therefore, plan as efficiently as possible the way we use our coal resources. We should, as far as possible, make sure that our new power stations can use either coal or oil where it seems desirable that they should be able to use both fuels, and we should locate as many of our power stations as possible in places where they will be able to make the most economic and efficient use of coal. I would far prefer to see new power stations sited in that way, rather than new hydro-electric stations, infinitely more expensive, built at this time.

I also believe—and here I may not take everyone with me, on either side of the Committee—that opencast coal has some part to play in all this. I say this for one or two reasons. First, the then Minister, in 1956, gave the industry an assurance that about 12 million tons of opencast coal would be needed for at least ten years to come. On the basis of that assurance, the industry imported and put money into all sorts of expensive machinery for the production of this relatively small quantity of opencast coal. Then, of course, it was the only aspect of the Coal Board's activities at one time which contributed any sizable profit, until part of it had to be axed.

Only a matter of weeks ago several hundred tons of large coal which had been unearthed was ordered to be buried again because a contract had expired and that large coal was thought to be an embarrassment by the Coal Board. This does not seem to me to be a very sensible way of carrying on. I should have thought that it would have possibly been helpful to the Coal Board to have had available to it at least some small part of its production which would yield relatively high profits for a minimum of disturbance, and I think that this matter should be 'reconsidered by my right hon. Friend.

I have no wish, in an evening when we have had some long speeches, to detain the Committee much longer. I hope that some of the points that I have made about the oil industry will be taken by some hon. Members opposite. I hope that they will recognise that there is no need, and no sense, in trying to imagine that there is some vital competition going on between the coal and oil industries. Each has a most important part to play if we are to have an efficient economy. Oil should play a most important part and should, in my submission, be allowed to play its part without any artificial interference.

I recognise that many hon. Gentlemen, I think on both sides, are rightly concerned that the coal industry should know precisely where it is to stand in the months and years immediately ahead, and that my right hon. Friend has already gone a long way in helping to shape things a lot more satisfactorily than we have been able to see them in considering this problem in earlier debates. I feel that we are now moving along the right lines. I hope that the new Chairman of the Coal Board will be given the support which I think he is entitled to expect from hon. Members on both sides of the Committee in the very difficult job that he has to do. I am certain that he will have the support of my right hon. Friend, and we wish him well in his new and difficult assignment.

7.10 p.m.

Mr. Norman Pentland (ChesterleStreet)

I think that many of us on this side of the Committee will agree with a great number of the observations made by the hon. Member for Walthamstow, East (Mr. J. Harvey), and particularly that the miner is entitled to know where he stands. That is part of our problem. To know that is our major task here today. We want to know the exact part coal will play in the economy of the country. When we have the answer to that, then the miner will have his answer on the question of where he stands in his employment.

I was very interested in the hon. Member's observations, with which I agree, about bringing power stations to the coalfields and the neighbouring areas. I entirely endorse that. We should like to see them come to the Durham coalfield. We need new industry there, and our prospects of having new industry would be greatly enhanced if whe had a power station on the doorstep of the Durham coalfield.

We always find in these debates on the coal industry that it is extremely difficult to limit ourselves to any one or two of the aspects of the problems facing us, because the range of the subject is so wide. I know that many of my hon. Friends wish to speak, so I intend to make a short speech, and I shall confine myself to only a few of these problems and to trying to reinforce some of the pleas which have already been made by my hon. Friends.

A good deal has already been said about the financial position of the National Coal Board both inside the Committee and outside. I say at once that we on this side could easily prove that, all things being equal, the Board has been a financial success. We can prove that quite easily. I want to reinforce the plea of my hon. Friend the Member for Midlothian (Mr. J. Hill), who referred to the high interest rates paid to the previous coal owners in compensation. One of the most foolish things the Labour Government between 1945 and 1950 did was to hand such generous terms as they did to the former coal owners, I was a coal hewer in the pit myself when that Measure went through. The language we used in the pits about those compensation terms could not, of course, be repeated in this Chamber where I have to use Parliamentary language.

Colonel Lancaster

Surely the hon. Member is not suggesting that the trading results for 1959 and 1960 have any bearing on the compensation. The trading results in 1960 were deplorable. How does the hon. Member explain that?

Mr. Pentland

The hon. and gallant Member knows full well, because in the four and a half years I have been a Member of Parliament we have debated on other occasions, the financial aspects, that I go back to 1947. I do not go back only to 1959 and 1960.

The hon. and gallant Member remembers the pleas which have been made by my hon. Friend the Member for Houghton-le-Spring (Mr. Blyton) for a review of the guarantee agreement which the Government had on prices, under which the Coal Board are not allowed to raise prices at a time when, if it had been allowed, it would probably have made £400 million profit. That was a year when it paid £70 million for coal imported into this country. There were subsidies for American coal coming here. If the Board had been allowed, as a commercial interest would have been allowed, to charge the real price of coal at that time, when there was a dire shortage of it in this country, and when the industrialists were getting the cheapest coal in Europe, probably the cheapest in the world, it would have made a substantial profit, but the Board was held to that agreement by the Tory Government. If we leave that business aside then we can say the Board has certainly been a financial success.

I reiterate that one of the great mistakes the Labour Government made was to pay out these too generous compensation terms to the former coal owners. When we thought of some of the dilapidated and decrepit holes in the ground left by some former coal owners—not all of them, but some of them—we in the pits said, at that time, that the coal owners ought to have been made to pay compensation to the nation. I would ask the Government to look at the interest rates paid on the compensation. Millions of pounds are paid in interest rates every year. Compensation is still being paid for pits which have been out of existence for years. Some pits have gone out of existence since the advent of nationalisation and still those coal owners are being paid large rates in compensation terms. I only hope that when the Labour Party is returned to power it will do something about this, because it is certainly a millstone round the neck of the coal industry.

A lot has been said, quite rightly, today about the manpower position. It is right that it should be emphasised strongly because it is of the utmost importance to this industry today. It is not only today that this manpower problem has been brought to the attention of this Committee. Some of us directed the attention of the Government to this over two years ago in a debate on fuel and power.

Strangely enough, in January, 1959, the noble Lord, Lord Mills, then Minister of Power, referred to it in another place, when he said, referring to the Government's being alive to the social and human problems brought about by unemployment among the miners: They also realise—and I would ask your Lordships to be good enough to bear this in mind—that if the coal industry's manpower fell beyond what was necessary to produce the annual coal supply needed when industrial production resumes its upward trend, we could again face embarrassing fuel shortages of the same order that arose in the early post-war years." —[OFFICIAL REPORT, House of Lords, 21st January, 1959; Vol. 213, c. 691.] That was Lord Mills himself, who warned the country at that time about the manpower problem.

I, also, in the debate we had on 6th February two years ago—and I am supporting my hon. Friend the Member for Southwark (Mr. Gunter), whom I congratulate on a very able and vigorous speech today—said: What will the Government do about the fears of an insufficient labour force in the pits if industrial production assumes its upward trend? From where will they get the miners? Do they think that we are still living in the days when the supply of miners could be turned on and off like a tap? I can assure them that that is not the position today. Many miners now unemployed will never again go down the pits, and neither will they encourage their sons to do SO."—[OFFICIAL REPORT, 6th February, 1959; Vol. 599, c. 746.] That is what we said two years ago on this vital question.

This danger of a depleted labour force is not a danger only to the Board itself; it could, in the final analysis, constitute a grave danger to our economy, because if we have not the men to man the industry the country will have a dire shortage in supplying its energy requirements in the very near future.

The Minister referred today to the manpower problem. He said that it was not so urgent and that men were coming back into the industry, but I would draw his attention to a Question which I put to the Minister of Defence on 11th May, 1960 I asked: how many men of 18 to 25 years of age, whose previous occupation was in the coal-mining industry of Great Britain, have joined Her Majesty's Forces during the years 1957, 1958, 1959, and to the latest available date in 1960, stating each year and each divisional area of the National Coal Board separately".—[OFFICIAL REPORT, 11th May, 1960; Vol. 623, c. 413.] The figures that I was given showed that in 1957 2,008 lads joined Her Majesty's Forces, in 1958, 3,472 joined, and in 1959, the number was 3,305.

The latest available date for the Minister at that time was up to 31st March. 1960, and 634 lads had then joined, making a grand total of 9,419 young men between 18 and 25 years who left the pits during that period and joined the forces. If, in putting my Question, I had gone back to the age of 17, and forward to the age of 26, I probably would have been told that many hundreds and may be thousands more had left the pits.

These are tragic figures, because not only have these men left the pits to join the Armed Forces, but they are probably lost to the industry for all time. Just as important is the fact that the Coal Board spent thousands of pounds in training these lads to become experts in modern mining techniques and now they are lost for ever to the industry. The manpower position in the industry at the end of 1959 was that 633,090 were employed. At the end of 1960 the figure was 582,950, a total reduction of 51,040. The total wastage for 1958–59 was 73,525 and the recruitment figure was 26,374.

I could not understand the Minister saying so clearly today that the position was better than it was in 1959, because the total wastage in 1960 was 93,603 and recruitment was only 42,557. These are very serious figures. It is just as well that today hon. Members on both sides of the Committee should emphasise the importance of once again bringing back an essence of security to men in the pits in order to get those who have left back into the pits and also to hold this drift away from employment there.

The Minister referred today to the export position. It was encouraging to hear that our exports of coal improved last year, but I can foresee many difficulties ahead for us in the export trade unless the Government do something about it. At present, we face import restrictions from the coal-producing countries which are members of the European Coal and Steel Community. There is fierce competition from Poland. We know that Poland is selling coal to the remaining European markets for any price that a buyer cares to mention and that she wishes to have foreign currency brought into the country at all costs.

The Russians are doing the same thing. I had the privilege, in July of this year, of being a member of an inter-Parliamentary Union delegation which visited the Soviet Union. During our stay in Moscow I had the pleasure of having a long discussion with the chairman and secretary of the Soviet Mineworker's Union. They told me quite frankly that their pits were uneconomic and that the Government were spending millions of roubles in subsidising the coal industry in the Soviet Union. Nevertheless—and I mention this in passing, for the benefit of the hon. Member for Kidderminster (Mr. Nabarro) who, unfortunately, is not now in his place—the miners are the top-paid industrial workers in Russia.

The Russian miner can retire at the age of 50 if he so desires. If he has worked twenty years in the industry he can take any five consecutive years of the last ten in order to strike an average of his pension entitlement. In other words, if over those five years he had an average wage of £20 a week in our money his pension would be £10 a week. If he continues working, as most of the miners there do because they are quite healthy and strong, at 50 years of age he receives 50 per cent. of that £10 pension in addition to his wages. He therefore would receive £20 wages every week plus £5, which would be 50 per cent. of his pension entitlement. The surface worker retires at 55 years of age on a similar basis.

This demonstrates what can be done in a country where pits are heavily subsidised. Yet we have complaints from the hon. Member for Kidderminster and others about wage increases paid to our miners. I am sorry that the hon. Member for Kidderminster is not now in his place. He talked as "daft" as it was possible for anyone to talk today about wages and the position of the coal industry. He made nothing less than a direct attack on his hon. Friend the Parliamentary Secretary to the Ministry of Power, and time and time again he went out of his way to villify the efforts of miners and the Coal Board.

Mr, John Eden (Bournemouth, West)

rose—

Mr. Pentland

I am referring to the hon. Member for Kidderminster.

I should like to refer to a wage claim granted to miners in 1956, when I worked in the pits. The day-wage men have again just had an increase in wages and now we see that the National Health Service charges are going up. It should be remembered that this means that men suffering from industrial injuries, from pneumoconiosis, fibrositis and other diseases, who need medicines regularly will have to pay these increased charges just like anyone else.

In February, 1956, a wage claim was negotiated on behalf of 300,000 or 400,000 day-wage men. A final agreement was reached whereby the National Union of Mineworkers accepted 2s. 4d. a shift for the day-wage workers. But the Coal Board at that time recognised that Is. 7d. of that wage increase was necessary to restore the real wage value that was being paid to the miners at that time, so that in all the miners had an increase of 9d. per shift.

We accepted it, but what happened? The very next day the Tory Government reduced the subsidy on milk by £38 million and the subsidy on bread by £23 million, and following that there was an increase in the Bank Rate. In our opinion at the pits the action of the Tory Government at that time had completely eliminated any gain that the miner had received from the wage increase.

The same policies are being put into effect again today. The hon. Member for Kidderminster and others should recognise that when wage increases are granted and accepted, certain policies put into effect by a Tory Government can always eliminate them and put the miners back where they were before.

I have drifted a long way from the export problem, but I return to it, and I have to do so and to refer to these things in order that hon. Members will know the true facts and not read a pamphlet and think that the pamphlet is a conviction. The export problem is a serious matter and the kind of thing that disturbs me about it was to read in the Press, some weeks ago, that a big power station in Denmark had bought a consignment of coal from Russia at a delivered price of 51s. a ton.

According to the Coal Board marketing experts, it is calculated that, allowing for a 2,250 mile rail journey and trans-shipment by sea, it boils down to the fantastic price of 21s. a ton. That is comparable with about 50s. a ton of coal from our best pits. We all know that that is an Unreal price, but, nevertheless, that is the kind of competition that the Coal Board has to face up to in the remaining European markets that are outside the Coal and Steel Community. I do not pretend that I know the answer to this problem but I feel certain that, here again, if our coal export trade is to have any chance at all, we must have Government help and Government encouragement. In other words, in this field also it calls for a political solution to the whole of the problem.

It is quite true that today there is a quiet air of optimism prevailing in our coalfields which, quite frankly, we all know was missing a year ago. That is all to the good and it is better that way. However, I ant convinced that, despite what the Minister said this afternoon, if certain questions are not answered by the Government and certain action is not taken, in the final analysis this optimism could be very ill-founded indeed. I would, therefore, ask the Government these questions—as I did my hon. Friend the Member for Southwark.

Can a categoric assurance be given today as to the part that oil, nuclear energy, and coal will play in the future in the economy of the country? What is the production capacity that is required of the coal industry? Is it to be tied to a lower level of demand or have the miners to "get cracking" again and chase every last ton of coal? These are the questions to which answers must be given, because in the answers lies the solution to some of the major problems now facing the Coal Board.

The important fact today—as several of my hon. Friends have emphasised time and time again—is that the industry must know where it is going; it must know what lies in store for it. If a political decision is not taken which will enable this industry to plan its way forward into the future, all the great endeavours that the Coal Board has entered into in reconstructing this industry technically, physically and spiritually, will he of no avail. In the end, the consequences will not fall only on the mining community alone, but on Britain as a whole.

I look forward to the future, as we should do, and as we in the industry are entitled to do, but the stark fact remains that we must know where the coal industry is going. My hon. Friends and the hon. Member for Walthamstow, East have said the same thing. We have often paid lip service to the fact that coal is a major part of our economy and will remain so for so far as we can see into the future.

In an article which the Minister wrote in the Financial Times of 3rd January, 1961, the right hon. Gentleman said: In this country coal remains and will long continue to be the basic primary fuel on which the British economy rests. It supplies today three-quarters of our total energy requirements. Although other forms of primary fuel will contribute increasingly to the task, we shall rely principally on coal for a long time to come. The well-being and efficiency of the coal industry, and its capacity to render the service the community needs, are primary objectives of our national policy. We can all agree with that, but the Minister may as well face up to the fact that if the Government are to bring these objectives to a successful conclusion, as he says he hopes to do, there will have to be a drastic change in the Government's present policy affecting the industry. In other words, hon. Members on this side are convinced—and we are very serious about this—that there will have to be put into effect a plan for the joint development of coal, gas, electricity and nuclear energy; a policy of coordination of all our fuel-producing industries which, furthermore, the Cabinet would accept as having full Ministerial responsibility. That is very important also.

We ask for this, although I hope that it is understood that we do not do so as one would ask for charity. There are 16 pits in my division and I would ask every man working in them to come out of those pits if, by a magic wand, the Government could transplant industries there so that they could start work tomorrow, and if such industries offered them security in employment. Every hon. Member on this side who represents a mining constituency would do just that, I am quite sure.

We ask for this, not as one would ask for charity, but we say that the Government have a duty to the nation to bring, forward such a plan. We ask for this not only in the interests of the miner and his family alone, but in the conviction that this vital industry should be given every opportunity to contribute in full measure to the prosperity that the people of Britain are entitled to in the years that lie ahead.

7.38 p.m.

Mr. Nicholas Ridley (Cirencester and Tewkesbury)

I listened with great interest to the hon. Member for Chesterle-Street (Mr. Pentland) and I will refer later to his main contention about a Government plan for the future use of fuel.

I should like to comment on the remarks made by the hon. Member for Derbyshire, North-East (Mr. Swain), who accused the Government of sabotaging the miners out of a Tory hate for nationalisation. It seems to me that we might usefully compare what happened in the European Coal and Steel Community, which is a very similar organisation to what we have in this country, and one of which we might well find ourselves members. Some hon. Gentlemen on both sides are interested that Britain should join the European Coal and Steel Community, and the Government have offered to join it as part of a bargain which would help to get us into the Common Market as a whole. Insufficient consideration has been given to this possibility and the effect that it would have on fuel industry's plan.

The ultimate aim of the Coal and Steel Community is the complete integration of production throughout. It would work towards a common price structure for goods of the same quality. It would work on a basis of fair competition between the various countries and the various pits with no subsidy or tariff or other advantage whatsoever between the various countries. It would work towards equal wages in the various countries of the Community. For instance, in Germany at the start the wages of miners were 27 per cent. higher than in Belgium, and that gap has already been narrowed considerably. It would work towards the same social benefits as part of the cost of employing labour. Finally, it would work towards full mobility of labour so that when there was a shortage in one area and a surplus in another, men would be enabled to transfer irrespective of national frontiers.

The fuel policy of the Six has been very similar to what was experienced in this country. After a period of shortage of coal, which went on until 1957, suddenly demand started to drop. There was a surplus of coal, and the competition from oil became increasingly severe. They were a little quicker than we were to take action, but, broadly speaking, they took the same sort of action as was taken in this country. I cannot help thinking that a comparison between Western Germany, particularly, and ourselves is extremely striking. Western Germany stopped imports except for a quota of coal which was being imported under contract from America. It started to close pits which were uneconomic, and it put some of the miners on short time in the most helpful way it could. Its stocks started to accumulate, but it did not allow them to rise to anything like the level to which ours rose, and it managed to keep the situation more in hand. Manpower left the pits in the same way as it has done in this country.

If we were members of the European Coal and Steel Community—and we might easily be—we should have had to join in the same measures as have been taken in the countries of the Six with regard to our mining industry. I think that the result would have been a slightly more intense application of the policies which the Government and the National Coal Board have applied in the last few years. They have reduced production and tried to hold prices steady, as we have. Perhaps we should have had to close pits a little faster if they were uneconomic.

It is important to remember that there would have been above us a supranational authority in the form of a High Authority which would have made decisions reached or speeches made in the House very much less effective than they are at present. We should have been under orders from the High Authority to carry out such-and-such a policy and, maybe, to close pits or to stabilise wages or to change the price of coal to a greater extent than we are at present prepared to do.

These things are, of course, possible, and it is necessary to try to adjust our attitude to the fuel situation in the light of the possibility that before long we might find ourselves members of this Community, and also to consider the effect on our policy at the present time if we became members of the Common Market and, indeed, what lessons we can learn from that organisation.

The first essential to bear in mind is that our ultimate aim in this matter must be to have as cheap a fuel in this country as we possibly can. Many times in the House we have debated exports. How can we hope to have cheap and competitive exports if we do not have throughout at least the cheapest fuel which it is reasonable to obtain?

The second factor which I should like to underline is that we should have no subsidy of the fuel industry. If every industry were to be subsidised, obviously there would be no industries to pay the subsidy, and we are getting very near the position when subsidies are paid too easily to private and public industries alike. We should keep Government money for the purpose of mining coal separate and out of the industry. We should keep our prices as low as possible after that, and the only reason which might justify a rise in prices should be the possibility of a loss at the end of the year. I hope that any accumulated deficit of the National Coal Board will not be charged to the taxpayers but will be recouped by greater efficiency or higher prices in the future.

I also think that we must allow consumer choice. No hon. Member opposite has stressed this point very much, but it is surely important to let whoever is going to burn this fuel decide whether he wants coal, oil, electricity, or gas. and to have the particular process or type of heating that he wants. I do not think we can intervene there.

Then we come to the so-called dilemma which the Minister mentioned in his opening speech, that between a completely free policy whereby the forces of the market, and those alone, act, or the so-called national fuel plan which hon. Member's opposite have been urging today. The national fuel plan seems to me to have several disadvantages. The main one—this is perhaps the answer to the point made by the hon. Member for Chester-leStreet, that we should set targets for each of the various forms of fuel in the future—is how we are to set targets. How are we to be certain that the targets set mean anything at all? The coal industry might in 1956 have set a target for 1961, and the estimate might have been 20 million or 30 million tons wrong. It is no good setting a target unless one is prepared to accept the consequences of working to the target even though it is wrong; and I do not think we are prepared to accept the consequences. Suppose we set a target for oil for 1965, and then found that the target was grossly too high or too low—we should then be forced to import more or less oil. Similarly with coal.

All businesses which are engaged in production have to make estimates of the future. They have to forecast demands and assess what they need to produce, and those forecasts must change every few months. The difficulty in business management is to assess demand and how it will change. This is surely the difficulty facing the Board in trying to balance its budget in the future. It must take into account competition and the likely price of coal, and even make a guess at the weather, and many other things. That, surely, is what it has to do.

Mr. H. Hynd (Accrington)

The hon. Gentleman has been saying that a plan is impracticable. Earlier on he was comparing our industry with the Coal and Steel Community of the Six. Is he aware that the Coal and Steel Community has worked out a very complete plan with very scientific forecasting of what the targets should be?

Mr. Ridley

I am aware of that. I am also aware that the plan proved to be extremely wrong in the case of coal. The Community had exactly the same misapprehensions as we did about what was to happen to coal when the situation changed in 1957.

Mr. T. H. H. Skeet (Willesden, East)

Atomic energy is another example.

Mr. Ridley

As my hon. Friend the Member for Willesden, East (Mr. Skeet) says, the forecast about atomic energy was also wrong.

I want to make a point about reserves of coal—

Mr. Loughlin

The hon. Member suggested that private industry has to make an assessment of the market and that that assessment has to be adjusted every six months or so. Would he say that that applies in industries with a high initial capital cost?

Mr. Ridley

I think that it does apply, but the difference is that the period over which it is looking is a very much longer one.

Mr. Loughlin

Exactly.

Mr, Ridley

Therefore, the penalties for being wrong are very much greater.

Mr. Loughlin

Capital is expendable.

Mr. Ridley

Nevertheless, every few months a private industry reassesses its position in the light of what it is next intending to invest and what it is to sell. It is a dangerous suggestion to say that capital is expendable.

The hon. Member for Southwark (Mr. Gunter) spoke of looking to our reserves of coal for the future. A strategic consideration, as it might be called, also comes into this argument about whether we are justified in using coal or oil in relation to future supplies of energy in the world.

It seems to me, if one is to use the hon. Gentleman's argument, the most sensible thing to do would be to shut down all the pits and turn exclusively to oil, because then, when difficulty came in the shape of a fuel crisis in the year 2,000 A.D. or of serious war, we should still have our coal reserves underground and could get at them when we needed them. His argument is a two-edged one.

The other point I wish to make concerns the drift of labour and the obvious decline which has taken place in the fortunes of the industry. Members opposite are right about this. The hon. Member for Blyth (Mr. Milne) pointed out in the recent economic debate that other industries should be brought into areas from which there is a drift of labour and where the quality of the coal is not such as to justify keeping pits open. The hon. Member for Chester-le-Street also represents an area with such problems.

I am certain that that is the right policy. We cannot expect to keep pits open in such areas just for the sake of keeping them open, but we must expect to try to provide alternative employment for those who will suffer. Many closures in the past have been due to exhaustion of supplies, but many also to general contraction of demand. If my proposition, that the forces of the market and the estimation of demand must force a change of policy, is accepted, then it is surely right to have a policy of closing pits.

Mr. Edward J. Milne (Blyth)

Now that we have convinced the hon. Member of the correctness of the policy we have been advocating, will he undertake to join us in pressing it on the Government Front Bench?

Mr. Ridley

Of course, we should make a forecast of which areas will not be economically useful, and should try to replace the pits in them by other industries. But that is not an easy thing to do, and it will take time. One cannot complain, as the hon. Member for Chester-le-Street did, that men are leaving the pits and that there is a serious drain of manpower if, at the same time, all one is trying to do is to close pits and replace them with other industries. The two things go together, and not separately.

There is a very great future for the coal industry. I am one of the first to admit that I was surprised when consumption went up in this past year to 203 million tons, and I am delighted that the National Coal Board has been able to lift 7 million tons from the stockpiles. I want to congratulate my right hon. Friend on getting that calculation so nearly right before the event. That was a surprising and intelligent guess.

My doubt is about what will happen next, and it is one that must remain in all our minds. It centres on the question: will consumption go up or down? But I hope that in the next year or so we will allow the commercial considerations to be uppermost in the estimate of what demand will be, and of what effect it will have on employment and the closing of pits and other forms of fuel policy. I hope that by so doing we can make ourselves sufficiently competitive, in dealing with oil on the merits of efficient, modern and effective pits, to he able to join the European Coal and Steel Community, if it be necessary on other grounds.

7.56 p.m.

Mr. David Ginsburg (Dewsbury)

As other Members on this side of the Committee wish to follow me in the debate, I hope the hon. Member for Cirencester and Tewkesbury (Mr. Ridley) will forgive me if I do not proceed immediately to take up the points he has raised. Unlike my colleagues, I myself cannot claim a practical experience of the coal mining industry, but it is only right that voice should be given to the anxieties of my mining constituents.

Dewsbury lies at the western end of the Yorkshire coalfield. It produces a very fine coal, but the pits in my area, although modernised, are comparatively old. Unquestionably, ours is a neighbourhood where there has been an exodus of labour, especially young labour, from the pits, and, indeed, from the locality in recent years. We are surely entitled to some reassurance about the future.

Above all, my mining constituents—like the constituents of some of my hon. Friends—wish to know where they stand. We say that the mining industry is not something that can be turned on or off like a tap. If investment is lost, or if miners drift away, then that loss may take a generation, or indeed many generations, to make good. What is wanted is a declaration by the Minister of the Government's intentions towards the mining industry.

Such a declaration is the more necessary because the industry has a very fine record of service to the country in recent years. During the economic debate which took place a fortnight ago, there was much reference by hon. Members to league tables, when it was argued that we stood at the bottom of certain leagues and the Government presented the argument that such statements were not of such very great significance.

I wonder if it is realised how different the picture is in the tables showing the position in coal mining. Productivity in the British coal mining industry is at present rising far faster than productivity in our manufacturing industry. Is it realised, despite what has been said, that the price of British coal is the cheapest in Europe? Is it realised that productivity in British mines is higher than the productivity in the mines of all other European countries, apart from Germany? In the case of Germany—and this was discussed earlier this afternoon—there is the special factor that the shift has been lengthened.

The central issue for the Government at the moment is one of knowing whether the energy demand, and in particular the demand for coal, will be adequate in the Immediate years ahead.

That brings me to the problem of forecasting. It is a difficult problem. Allusion has been made to it by the hon. Member for Cirencester and Tewkesbury, and I hope that the Parliamentary Secretary will say something serious and constructive about the long-term forecasting arrangements in his Ministry. It is not enough that a lot of long-term forecasting is coming from the various component industries such as the electricity industry, the gas industry, and the oil industry. We get a contradictory picture, and it would be helpful if the Minister could tell us what is happening about this in his Ministry. Are the techniques sufficiently sophisticated? We would like to know the assumptions which relate to the various estimates that are being produced with regard to long-term demand.

That brings me to what I think is one of the key points in this debate. Are the Government sticking to their estimate that energy requirements in this country will be 300 million tons of coal equivalent by 1965, or do they now accept the probability that they have over-estimated the position and that demand by 1965—it is now only four years away—is more likely to be 280 million tons? I ask that in all seriousness because it is not just a guess or a shot in the dark. It is a responsible estimate which has been made not only by the National Union of Mineworkers, as the Minister knows, but by the National Institute of Economic and Social Research, by Professor Robinson, the Chairman of the O.E.E.C. Energy Commission and by the Chairman of the Institution of Gas Engineers. There is wide agreement on this lower figure and I wish that I could be as optimistic as the Minister has been recently.

If the latter figure is true, if this figure of 280 million tons is likely to be correct. it is very difficult, as my hon. Friend the Member for Ashfield (Mr. Warbey) said on a previous occasion, to see a demand for 200 million tons of coal materialising.

I should like to develop that with two subsidiary points. Hon. Members may have read the publication "Fuel Policy in a Free Economy" which was recently circulated by the Esso Petroleum Company, which one must assume is a responsible organisation in this matter. I stress these figures to the Minister. The company estimates the requirements for 1965 as 200 million tons of coal and 74 million tons of oil compared with 188 million tons of coal and 56 million tons of oil in 1959. In other words, the Esso publication, which I say again the company is presumably putting forward in a responsible way, is providing for an increase of 18 million tons in oil consumption over five years.

We are not half way to 1965, and already oil consumption in this country is running at a level of 63 million to 65 million tons a year. With four years to go to 1965, I should have thought that on present trends it was clear that oil consumption would reach a level of 90 million tons by then.

Mr. Skeet

rose—

Mr. Ginsburg

I am sorry, I would rather not give way now because of the time factor and because I want to develop my argument.

If oil consumption standing at 90 million tons is deducted from 280 million tons plus the 10 million tons of the atomic programme, we are left with 180 million tons for the coal industry. This is a serious point, and I hope that when the Parliamentary Secretary replies he will say whether he accepts my argument or whether he thinks, as I do, that there is a flaw in the figures put forward by the Esso Company.

The reason why we feel a certain pessimism is that it is not reasonable to feel complacent about the increase in consumption from 194 million tons in 1959 to 203 million tons in 1960. There are a series of special reasons why consumption went up in 1960. There was the abnormal change in the weather, and a big change in the production situation between 1959 and 1960—for which hon. Gentlemen take credit. It is therefore extremely difficult to see how coal production will rise very much in the years ahead above the present level of 194 million tons.

If I am wrong about that, again I would appreciate it if the Minister would say what the Government think will be the precise production figures for coal over the next four years.

The picture that I have painted is alarming enough, if there were not, as has already been suggested, serious implications in the present position of the oil industry. We urge the Government to give serious consideration to the point of view of the mining industry because it is an indigenous product, while oil is imported.

What I may describe as the oil partisans continuously refer to the contribution which they say the oil industry is making towards the balance of pay- ments. What are the facts? My hon. Friend the Member for Southwark (Mr. Gunter) said that the facts were extremely unclear. The only facts that I can give the Committee—and I do not think that these will be disputed—are that for 1959 total oil imports were £467 million, to be set against exports of £101 million. By doing some simple arithmetic, there is a difference of £366 million.

The critical question is, are the £366 million which are a drain on the balance of payments covered by an adequate figure of invisible earnings by the oil industry? What are the facts? Nobody seems to know. I seriously suggest to the Minister that he should consult the Chancellor of the Exchequer with a view to issuing a White Paper at least on the position of Britain's invisible oil earnings, if not on the whole question of Britain's invisible trade balance in which oil plays an important part.

I hope that I shall be in order, Mr. Williams, if I mention three figures about our invisible account to which oil contributes. Before the war we had a surplus on invisible account of £280 million. In 1950 that surplus had risen to about £444 million. Today it has fallen to £115 million. I know it is not all oil, and of course the question is, how is oil contributing to this outturn. The only figure that I can contribute to this debate is that the earnings of the oil tanker fleet and the property and income of the oil companies are grouped together in the "Others" item in the balance of payments White Paper, and that item includes many things besides oil as well. That suggests that for the period 1950 to 1959 all these items together—non-oil as well as oil items—have risen by only £42 million from £288 million to £330 million.

I will quote a passage from an article on the invisible trade balance and invisible earnings which appeared in the National Institute Economic Review. Having commented on the lack of knowledge which exists in this important sector, the article says: It may be some years before earnings recover to the 1958 level, since the industry"— that is, the oil industry— is becoming increasingly competitive and pressure from the producers for a bigger share of profits is mounting once more. Anyone who follows world affairs will agree that that trend is likely to continue.

On that evidence, a very serious position is clearly developing as regards oil. The Chairman of the National Coal Board said early this month: We are told that 1960 was by far the worst year of the United Kingdom balance of payments since 1951, that the deficit may be as high as £150–£170 millions. No less than one-quarter of this deficit can he attributed to the increase in oil imports during 1960. I know that what I have said has not commanded the universal approval of hon. Members opposite, but I seriously suggest to the Minister that there should be a searching investigation into the economics of the oil industry from the point of view of the balance of payments. The Minister should undertake this inquiry and publish the conclusions fearlessly so that we can decide what action can be taken.

There are many considerations for an efficient coal industry. I have not time to go into all of them. One of the keys to greater efficiency is scientific research. I believe that I shall carry the Committee with me when I say that over the whole range of industries there is a direct statistical correlation between the input of scientific research and the improvements in productivity and efficiency which take place. Not only should there be an improvement in scientific research and a balanced deployment over the whole economy, but there should be the most effective deployment of our scientific research, manpower and funds between the various claimants on resources in the fuel and power industry.

This brings me to the vital question. It has been mentioned already that the nuclear power programme, having been curtailed, will contribute in 1965 about 10 million tons of energy equivalent. I hope that we shall hear some figures later on. Is it not the fact that a disproportionate amount of scientific resources, money and staff are still being devoted to this programme? If coal is to be produced efficiently at low cost, far more scientific advance has to be achieved, first in the coal industry and. secondly, in the gas industry.

I gain support for my submission by quoting briefly what Sir Christopher Hinton has said on this subject. He is a convert in this matter, because he was once a very energetic partisan of the atomic school. At a recent conference he said: What the coal mining industry was entitled to ask itself was whether in the broad research field it was getting its full share of the national research effort. This is a fundamental problem which was not considered sufficiently. The danger was that all these exciting conventional technologies tended to get overlooked and given little consideration compared with research projects which were related to defence. If the Minister wants the maximum advance in the coalmining industry and in the gas industry he should get together with the Minister for Science and ensure that our scientific manpower is properly deployed.

My final consideration relates to the efficient operation of the coalmining industry. It relates, in particular, to financial policy in the industry. The Government wish the nationalised boards to be guided by normal business considerations. I do not quarrel with that point of view, but if it is the Government's policy to see that the nationalised boards are guided by normal commercial considerations it is incumbent upon the Minister to accept the corollary which is implicit in the Report of the Select Committee on Nationalised Industries. It was applied primarily to the transport industry, but there is no reason why it should not be applied to the coal industry. The Committee says: Your Committee wish to recommend the principle that where Government action causes a nationalised industry to incur a specific loss, or specific expenditure, which it would not otherwise incur, the Government should take steps to compensate the industry". Looking around the whole range of coal policy, —stocking policy, and pricing policy—it is obvious that that principle has not been applied which has operated to the industry's disadvantage. There is a case—it has been made already by a number of my hon. Friends—for a complete re-examination of the financial structure of the industry, because if it took place we should see a greater degree of efficiency in financial operations.

The Government have been asked many questions from both sides of the Committee. To summarise the most vital point which has been made so far this evening, I say that the industry should not be left in unnecessary uncertainty. It is surely the Government's duty to tell the industry what in the light of their judgment is expected of it and to face fearlessly the policy implications of that judgment. It is then for the mining industry, the National Coal Board and the miners to see that the coal is produced efficiently.

8.18 p.m.

Mr. T. H. H. Skeet (Willesden, East)

I am glad to have had the opportunity of catching your eye, Mr. Williams, now that the hon. Member for Dewsbury (Mr. Ginsburg) has had an opportunity to put forward some ideas on the balance of payments. I ask hon. Members to bear in mind that purchases of both crude oil and petroleum products in 1960 worked out at about £475 million. We must set against that figure the export of petroleum products, which worked out at £104 million, to which must be added the export of petroleum equipment, which was well in excess of £100 million. An extremely conservative estimate of the value of petrol-chemicals is £30 million.

However, there is a great deal in addition to that. Hon. Members were right to emphasise that the figures for the earnings of the oil industry have not been revealed. It is also right to make clear that only 13 per cent, of the oil is bought in dollars. Therefore, the larger part of it is bought in sterling or in soft currency. Freight charges enter into this argument, because 37 per cent. of the oil is brought in in tankers flying the British flag. This is reflected in the shipping figures. If the freight is at the right figure, the earnings are exceptionally high.

I have seen it estimated that this country would have to export annually about £300 million more if we lost our profits in the Middle East. Hon. Members would do well to bear in mind what our holdings are—a 50 per cent. interest by B.P. in the Kuwait Oil Company; a 24 per cent, interest by both the Royal Dutch Shell Group and B.P. in the Iraq Petroleum Company; and a very substantial interest—over 50 per cent. —by the Royal Dutch Shell Group and B.P. in Iran.

If these are totalled up, it will be seen that the balance is very much in favour of the oil industry and that in fact there is not a net loss. The import of fuel oil up to the end of November last year was about 2.2 million tons in a year, compared with the export of fuel oil of about 3.4 million tons, so that there is a net gain in exports. Over the whole industry, there is no question of straining the balance of payments position, because there is more in hand.

My right hon. Friend has said that the country's total energy consumption is likely to be 300 million tons of coal equivalent by the late 1960s. There is some doubt about that. The hon. Member for Dewsbury gave a long list of authorities and considered that 270 million tons would probably have to be the figure reached by 1965.

I want to quote a further figure which appeared in one of the Cantor lectures by Mr. Alfred Parker, former fuel research director of the D.S.I.R., who reached the interesting conclusion: Assuming a continuation of increase in energy demand at about the same rate as during the period 1938 to 1958, the demand would be equivalent to about 280 million tons of coal in 1970… Looked at the other way round, my right hon. Friend has suggested that we should stabilise the mining industry's capacity at around 200 million tons, but I wonder whether he can hold to that figure. While he is perfectly right not to underwrite any figure for the coal mining industry, the industry is entitled to know what it may have to face in future years.

Consumption of oil in the United Kingdom at the moment is about 40 million tons and, given an average compound increase per annum of 8 per cent., that will build up to 59 million tons by 1966, or a coal equivalent of well over 90 million tons, which falls into line with the figures already advanced by the hon. Member for Dewsbury. Allowing for an extra 10 per cent. coming from hydro and nuclear energy, that leaves 170 million tons to be found by the coal industry.

We come back to the difficult question —what precisely does my right hon. Friend mean when he speaks of a mining capacity of 200 million tons? Does he mean that it will be like the steel industry of the United States where, although it has a capacity of 100 per cent., it may operate at only 50, 60 or 70 per cent. of rated capacity? Does he mean that by 1965 he will have a mining capacity of possibly 200 million tons, while the effective operating capacity may be only 170 million or 180 million tons?

We are all rather worried about the situation and it is only right to say that, whichever prognostication is correct, the figures will have to be studied most carefully and that the mining industry may have to scale down the size of its operations below 200 million tons per year. Obviously, with an industry accommodating three-quarters of the country's energy requirement, I cannot agree with the hon. Member for Southwark (Mr. Gunter) that the industry is demoralised.

Certain taunts have been made about the fuel oil industry. It may well he that over the past year fuel oil consumption has been about 29 million tons of coal equivalent, but that is only 15 per cent. of the fuel market. There is no case for the suggestion that we should have an imposition of, say, 1½d. per gallon tax on fuel oil. As my hon. Friend the Member for Walthamstow, East (Mr. J. Harvey) said, that would be an additional charge on the steel industry and would lead to a rise in basic costs. But there is another factor to consider.

In recent months, a tax was imposed on light and heavy fuel oils in West Germany. It is interesting to find that that increase did not stop the increase in the sales of fuel oil.

We should look at the pattern in Europe. In the O.E.E.C. area, comparing 1948 with 1959, the proportion of total fuel supplied by the prospective energies show that coal has come down from 80 per cent. to 60 per cent., leaving oil supplying 29 per cent. of the market in 1959.

We could take another example from Europe. In 1948, the total contribution of oil was about 3 per cent., but this year it will be more than n per cent. It has been said that by 1961 oil and natural gas will provide 41 per cent. of total energy consumption in the Soviet Union.

All the trend is therefore in the same direction and the more these fuels run in harmony and partnership the better. The object is to provide industry with an inexpensive basic fuel, for it is essential to keep costs down.

I hope that all this will not be regarded as an attempt by the oil industry to chase people out of the mines. I do not have the fortune to represent a mining constituency, but I fought a mining constituency at a fairly recent election. Hon. Members who represent mining constituencies have to ask themselves when should they redeploy the men involved in that industry. Have they to wait a number of years, after a number of mistakes have been made, to redeploy them, or should they not be moving ahead as rapidly as the position changes, bearing in mind the consistent pattern which has been followed in Western Europe?

Many people have had a stab at evaluating available world resources of oil. I should like to give some figures. Lewis G. Weeks has recorded primary resources as being 1,900 thousand million barrels, which is equivalent to forty years' supply at the current rate of production. However. these are primary resources, and if we include secondary resources, such things as secondary oils, tar sands and shale oils, the figure is 14,600 thousand million barrels. That will probably take us not only into the next century, but into the century beyond as well.

I promised my hon. Friends that I would not speak for longer than ten minutes, but before I conclude I must say that if we make evaluations too far in advance, we may fall into the trap of failing to take into account a breakthrough in atomic energy and other developments, for example, developing fuel cells and converting energy from the sun. It might be dangerous to look too far ahead, but it is wise to look five or ten years ahead. We can see to the edge of that time, but no more.

8.28 p.m.

Mr. William Warbey (Ashfield)

The hon. Member for Willesden, East (Mr. Skeet) spent a certain amount of time attacking forecasts made by the Ministry of Power, and my hon. Friend the Member for Dewsbury (Mr. Ginsburg) also called attention to the importance of forecasting in connection with this problem of fuel and power policy. In fact, this is the key to the question whether or not we have a policy and whether we are seeking to make the policy effective.

The Ridley Committee in 1952 recommended the establishment by the Ministry of Power of a Joint Fuel and Power Planning Board. It is useless to talk about having a policy unless one is prepared to use a policy that is a basis for planning and unless one takes steps to ensure not merely that one's forward estimates are reasonable and sound but also that they are fulfilled and that steps are taken to fulfil them. This is really what planning and having a policy means.

It is understandable that the present Government are incapable of having an effective fuel and power policy, and still less of planning to ensure that that policy is carried out, because it is contrary to their whole philosophy. It came out very clearly in what was said by the Minister this afternoon, and it has come out perfectly clearly in statements which have been made by previous Ministers of Power or their representatives. For example, when the present President of the Board of Trade was the spokesman in this House for the Ministry of Power. he said on 30th April, 1957: …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: He defined these as follows: 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."

He added: As far as possible, we should allow the balancing of demand and supply of energy to be determined by normal commercial considerations."—[OFFICIAL REPORT, 30th April, 1957; Vol. 569, c. 36.] Of course there is the complete contradiction, in which the Government and every Tory Minister of Power is engaged. The Minister has somehow to ride two horses. The present Minister referred to it as following the middle way because, he said, by doing so he was attacked from two directions at the same time—by the planners and by the anti-planners—and he thought that. therefore, he must be about right. In fact, he is doubly wrong, because he now follows neither a planning nor an anti-planning policy consistently but merely gets into a mess. This has come out most clearly of all in the terrible muddle into which the Minister has got in respect of planning forecasting.

Some reference has already been made to this, but first of all I suppose we all recognise that, if one is to attempt to do any sort of planning for the fuel and power industries, one must begin to make some sort of forecast of future energy demands and, having made those forecasts, one should try as far as possible to keep somewhere near to them. Future energy demand depends upon the general level and expansion of economic demand in the country as a whole.

When we have, under the present Government, industry going up and down at irregular intervals and failing as a whole to reach the targets for expansion which have been set in the past by Tory Ministers, we can see how impossible it is to have really effective forecasts of future energy demand which itself is the key to economic expansion as a whole. We had, for example, in 1955 the famous Government estimate of 300 million tons of coal equivalent by 1965. Then the President of the Board of Trade, speaking in the debate on 23rd July, 1959, still held to this figure of 300 million tons of coal equivalent, although he then admitted that To reach that figure by 1965 the expansion that is taking place in industry now will have to go ahead very fast, but I still think that it is reasonable to take 300 million tons as a rough figure for the total energy demand in the middle 1960s."—[OFFICIAL REPORT, 23rd July, 1959; Vol. 609, c. 1559.] There is already a slight shift from 1965 to the middle 1960s.

I put a Question to the Minister of Power to which, in a Written Answer. the Parliamentary Secretary replied on 6th December: Inland energy requirements in 1961 may not be far short of 270 million tons of coal equivalent … and may rise to about 300 million tons of coal equivalent in the later 1960s."—[OFFICIAL REPORT, 6th February, 1961; Vol. 634, c. 11.] We have shifted from 1965 to the middle 1960s and now we have come to the later 1960s.

There has been a corresponding shift, though not a fully representative one, in regard to the estimate of what would be the share of coal on the basis of these assumptions and if no deliberate action in favour of coal were taken by the Government. We had, first of all, the acceptance by the Government of the Revised Plan for Coal as the coal target for 1965. A figure of 200 million tons is very often used with reference to 1965 when, in fact, the Revised Plan for Coal, produced by the National Coal Board only fifteen months ago, set the production target for 1965 and set also the consumption estimate for 1965. The latter estimate was that inland coal consumption plus exports would be about 207½ million tons, with a variation either way giving a figure between 200 million and 215 million tons.

More recently, we have had a shift in the Government's statement towards fixing the target at the lower level of 200 million tons. Later still, we had the further shift referred to by the hon. Member for Willesden, East, when the Minister of Power, in reply to a Question from me on 13th February, said: As I told the hon. Member for Sedgefield (Mr. Slater) on 5th December, there are no changes in the estimates of total inland energy requirements which would justify the Board in aiming at a mining capacity of less than 200 million tons in 1965." —[OFFICAL. REPORT, 13th February, 1961; Vol. 634, c. 918.] So we have now come down from an estimated consumption of 207½ million tons in 1965 to an estimated production target in 1965 of 200 million tons, and then to an estimated mining capacity of 200 million tons.

How much lower are we to go? What is the use of the Minister saying that everything in the garden is lovely when we only look at what has been happening in the last year and the first three months of this year and see that, contrary to all expectations, demand for coal has risen again and, if we were to proceed on the basis of what has been happening in the past year—as he said to me last Monday—we could expect an energy demand in 1965 of 350 million tons of coal equivalent?

How fanciful can one be in attempts to estimate and plan, when there is really a margin like that between a total estimated energy demand for 1965, on the one hand, of about 280 million tons of coal equivalent and another estimate of 350 million tons of coal equivalent, on the other? How on earth can one plan on such a basis? Not having been able to approach 75 or 80 per cent. accuracy in one's estimates of possible total energy demand in 1965, and having such a tremendous margin of error, if we are still not prepared to settle to some extent the share of the total demand to be taken by the different energy industries, we are really leaving the coal industry without any defined future whatsoever.

The situation is that we know that the nuclear capacity in 1965 is now to be between 9 million and 10 million tons, and there are another 3 or 4 million tons, and perhaps 4 or 5 million tons, which will be accounted for by hydroelectricity and natural gas. We may well be too low, as the hon. Member for Willesden, East said, if the use of oil in this country continues to expand at even a somewhat slower rate than during the past five years. We may well be left with an inland demand for coal of about only 170 million tons in 1965.

Mr. Skeet

Would it be right to stabilise the coal industry at that particular figure?

Mr. Warbey

I have not much time. I will say only that we must stabilise it, but we first have to decide where we are to stabilise it.

What is a reasonable figure, taking into account all the factors? One of the factors which I should take into account is that we must not have too sharp and sudden a run-down in the coal industry, because of the social effects and their cost. That is the first factor. Therefore, I would say that 170 million tons is far too low. We should not fix it at less than 190 million tons, and I say that if we are to aim at a capacity of 200 million tons in 1965, we should guarantee that the consumption—the demand—in that year will not be less than 190 million or 195 million tons, and that we should take whatever steps are necessary to guarantee that that amount will be taken up.

This is the only way in which, as the hon. Member opposite says, we can stabilise production; but also, if we are to avoid all manner of very harmful social and economic consequences for the people of this country in general, and for the miners in particular, we must be prepared to guarantee and underwrite the consumption at a figure round about what we are asking the industry to produce. That can be done only by applying measures of direct planning in order to ensure, one way or another, that oil consumption is adjusted to the appropriate figure; that oil is made to take the adjustment and not coal and that the adjustment is made by means of import quotas, tariffs, taxes or the outright nationalisation of oil refining and distribution by whatever methods are necessary to achieve that object. That is what real planning means, and we will never get it in this country.

8.44 p.m.

Mr. Percy Browne (Torrington)

In order to allow the hon. Member for Ebbw Vale (Mr. M. Foot) time to make his speech within the remaining six minutes, I will re-arrange my speech and not range over the whole field of the industry, because that has been done sufficiently already. Indeed, I wish to make only a few specific points about the future.

On the one hand, we have increased productivity which we have been told by one hon. Member is in the region of 7.2 per cent. per man shift, and yet we are not necessarily producing the types of fuel that we want in all cases. At the same time, we have had a contraction in our labour force, and I hope that the Minister was right when he told us that we had now come to the bottom of the graph. At the same time, we are "lifting" above a figure which will leave us with an adequate reserve, and, because of this, we shall be down this year to the minimum that we should keep in reserve. We must reduce stocks. but not for too long at the present rate.

If we are to keep our indigenous fuel industry going, which I believe we must for strategic reasons if for no other, I should like to make a few suggestions as to how we should do this. Here, like my hon. Friend the Member for Kidderminster (Mr. Nabarro), I propose more or less to read a list because of time, but my list is not so long as my hon. Friend's. The first essential is that we should have efficiency, and that means that we must keep the price steady so that coal can compete with oil, as I am sure it can. Secondly, we must have efficient conversion to burn the fuel. The new Chairman of the Coal Board was perfectly right the other day when he said that the efficiency of coal conversion is improving all the time, and the more we can do this the less people will want to change to oil.

Thirdly, we must produce the fuel which people want. Apart from the South Wales fuel—anthracite, and so on—which is a difficult problem, we are up against the question of how we can produce larger coal without having to hand- hew it. I was interested in what the hon. Member for Derbyshire, North-East (Mr. Swain) said about the mechanical cutter which he himself used in the pit. This is a problem which the industry must surely face. We want to produce large house coal which will sell and prevent people turning to other forms of fuel but we do not want the miners to go back to hewing coal by hand.

I would add to what my hon. Friend the Member for Kidderminster said that we can improve screening at the pithead. When I last spoke in a fuel debate I was a coal merchant. I am no longer, owing to the exigencies of my job here. I do not need to declare an interest. But I said at that time, and I repeat it now, that there is a great deal of foreign matter getting into the coal sheds and I am wondering whether the National Coal Board can do anything about it.

I now wish to mention the railways. I was interested to see my namesake from America suggest the other day that the steam engine was more efficient than the diesel engine. If it is true, as this American gentleman tried to prove, that the efficiency of the steam engine is greater than that of the diesel engine and if at a time of crisis we are to depend on our coal industry, it would be sensible to run our engines on coal.

I said that I would sit down at seven minutes before five to nine. I see that the hon. Member for Ebbw Vale is about to rise and I will therefore say no more.

8.48 p.m.

Mr. Michael Foot (Ebbw Vale)

I am extremely grateful to the hon. Member for Torrington (Mr. P. Browne) for allowing me a few minutes in which to speak. I am glad that I caught his eye.

I have not the direct experience of almost all my hon. Friends who have spoken about the coal industry, but I think that to anyone who goes to the coal areas, where I have been in recent months, one contrast hits him in the face. It is the contrast between the mood of anxiety that prevails in the coal industry and the iron-clad complacency, or, perhaps, I should say the well-oiled complacency, of the Government. The people in the mining areas, certainly in Wales, would not accept the accent in which the Minister this afternoon spoke of the future of the industry.

When we hear hon. Members opposite, one after another, representing and speaking so enthusiastically on behalf of the oil interests and in favour of the Government's policy, it adds to the alarm which we feel about the situation. No one can say that what has happened in the past three years is a small affair. We have had a decline of 130.000 in the number of people working in the industry, a decline of 30 million tons in production and the closing of 136 pits. Those are extremely formidable figures.

I cannot help thinking what would have been the situation if the industry had been in private hands during this crisis in the coal industry between 1958 and 1960. If it had still been privately owned, I guarantee that the private coal owners would not have had to pay for the stocking programme, if, indeed, there had been any stocking programme at all if there had been private owners. Moreover, if the industry had still been in private hands, the private owners would not have had to pay for the previous import of the coal. Certainly, if during these critical years the industry had been in private ownership, there would not have been talk on the other side of the House that the private owners must meet the full blast of competition and that it would be wrong to have a tariff or protection.

If the industry had been in private hands, there would have been a great campaign run by the private owners, with posters and full-page advertisements in the newspapers and dozens of hon. Members opposite getting up on behalf of the coal industry. None of these facilities, however, has been provided, because it has been a nationalised industry. Indeed, the Government have been quite prepared to see this crisis continue. It has been a much bigger crisis than has affected any other industry in the land. We have been supposed to have been living through three years of affluence, during which period the coal industry has suffered a swifter and bigger decline than, probably, at any other time in its history. This is a serious situation.

The Minister said that things will be a bit better now, but his proof of this was not very convincing. When giving the manpower figures, he said that the industry was losing about 1,400 men a week at the beginning of 1960 and that the figure had come down to 350. To lose 350 a week is still a very heavy loss. Does the Minister deny that the number of miners now in the pits is lower than the total which the Coal Board said that it would require at this time, and that it is falling still lower? As one of my hon. Friends said, the situation is further underlined by the fact that half of those who are leaving the industry are under the age of 31. Do not the Government think that these are serious figures and that they have a real crisis to deal with?

When the Minister said that the circumstances have now altered and improved or that there is a change in the situation, he did not produce any solid facts to support that contention. Indeed, from what he said in the rest of his speech, he went on to add to the sense of alarm that might be felt, because he explained why he would not fix a figure for the future and why he would not accept The demand made by the National Union of Mineworkers that there should be a guarantee for the future.

The Minister gave three reasons why such a figure should not be given and why he should not take planning action in that sense. His first reason was that it would cause higher energy costs and put up the price to some extent. That might be so. Secondly, he said that it would involve control on consumption and, thirdly, he said that it would interfere with the commercial autonomy of the industry. Those, however, are things that the Government are quite prepared to do in the case of other industries. [An HON. MEMBER: "The railways."] In the case of the railways, to some degree.

In the case of agriculture, the Government have done that for years. They do not talk about the commercial autonomy of the industry. They do not talk about putting up the price—they do it. I do not say that protection is the best way to do it. One of the sinister aspects of the Minister's speech is that instead of talking about planning, he talked as if it was protection. It need not be protection at all.

Even more revealing of the Government's mind is the attempted but feeble reply by the Minister to what my hon. Friend the Member for Southwark (Mr. Gunter) had to say at the beginning of the debate about the wider perspective of the fuel requirements, both of the nation and of the world, in the years ahead. As far as I can gather, although we are so critically dependent on coal, we have made less inquiry than the United States of America into what will be our fuel requirements for the future. We have not had the same kind of survey, and yet the Minister blithely pushes it aside as if this is not a major issue which has been argued by some of the greatest experts.

I urge every Member of the House who is interested in the subject, although I cannot quote or argue from it now, to read the statement and the case presented on this issue by Mr. Schumacher, of the Coal Board. As far as I know, it has never been answered in detail. Certainly, it has not been answered by the representatives of the oil interests in this debate. Indeed, many of the representatives of those interests have contradicted themselves during this debate. They have said that there is no need to worry, because oil imports do not interfere much with coal and are not really in competition with it. Then, a few sentences later, they add that the Government are keeping out the Russian oil which is causing a disastrous state of affairs.

The representatives of the oil interests have not presented any case in reply to the general demand made by my hon. Friend the Member for Southwark that the Government should put the whole of the fuel policy in new and much broader perspective. If they do not do so, if they do not change the situation and take action which could change the mood inside the coal industry and the coal communities, they are running terrible risks.

One of the miracles that has been achieved in this country since 1945 was to rebuild the coal industry from the desperate position in which it had been plunged. It was a miracle to do it once. We shall not be able to do it twice. If we allow this industry to decline again at the pace at which it has been declining during the past three years, or even at a pace which is one-half or one-quarter of it, we shall never be able to rebuild it again. Therefore, I hope that we shall have a much more forthright and general statement of the Government's fuel policy than anything that we have had or remotely had from the Treasury Bench in this debate.

9.0 p.m.

Mr. William Blyton (Houghton-le-Spring)

During the debate today hon. Members have been asked to declare their interest, so I had better declare mine immediately. I am a miner by profession, and a Member of Parliament by accident. For forty-one years I have been a member of the miners' union, and I am proud of it. I preface my speech in winding up this debate for the Opposition by stating that fact so that I shall not be asked to do so during the course of my remarks.

I should like to associate myself with the Minister in his tribute to Sir James Bowman. James Bowman and I have known one another for forty years. He comes from the North. He went to his job on the Coal Board with great knowledge of this industry. He did a remarkable job in the days when coal was difficult to get. He had to face the contraction and at the same time reorganise the industry, and I am sure that we on this side of the Committee wish him many happy years in his retirement.

We wish Alfred Robens well in the difficult job he has to face. He has declared that he will fight for coal and he can rest assured that we on this side of the Committee shall give him all the assistance we can. Although we do not share his super-optimism, I think he will do the best he can for this industry of which he is now in charge.

My hon. Friend the Member for Southwark (Mr. Gunter) opened the debate with a fine speech, and he put the case very clearly for our side of the Committee. He most certainly made a splendid case in relation to the future of the whole of the energy industries of this country. The hon. Member for Aberdare (Mr. Probert), the hon. Member for Chester-le-Street (Mr. Pentland), the hon. Member for Derbyshire, North-East (Mr. Swain), the hon. Member for Midlothian (Mr. J. Hill), the hon. Member for Dewsbury (Mr. Ginsburg), the hon. Member for Ashfield (Mr. Warbey) and the hon. Member for Ebbw Vale (Mr. M. Foot) have all made good contributions to the debate, and I shall support them in my arguments.

I was surprised at the statement made—I am sorry that he is not in the Chamber—by the hon. and gallant Member for South Fylde (Colonel Lancaster). When he said that there were 4,000 people at Hobart House and that the cost was 3s. 6d. per ton he nearly took my breath away.

I decided to make some investigations into this statement. The facts are that at Hobart House there is a staff of 1,890 and it costs 2d. per ton. On the books at Hobart House are included people in research stations at Stoke Orchard and Iskworth and other staffs, and that brings the total figure on the books at Hobart House to 3,400. This means a total cost of 4d. per ton. The whole cost of Hobart House staff, outside staff on the books, all of the district staffs, and the pit staffs in administration down to the manager to the underground engineer is a total cost to the industry of 1s. 11d. a ton. I fail to see how the hon. and gallant Member for South Fylde could make that statement or quote that figure.

Hon. Members

Where is he?

Mr. Nabarro

Having something to eat.

Mr. Blyton

I listened to the Minister with great attention. I was surprised when, after they closed a hundred pits and brought the production of coal below the 1960 consumption, and after 153,000 men have been driven from our mines, he declared that, with the recession from the motor car and other industries, we are now getting a trickle of men back, and that our men in this industry can regard themselves now as having a great future. I will be quite frank: I fail to see it.

The Minister made great play with the Local Employment Act, saying that it was easing the employment position and redundancy. I do not know the position in other parts of the country, but I have a large mining constituency and unemployment in my constituency is over 5 per cent. and the Government have done nothing for them up to now, nor do I see them doing anything for them in the future. That Act is certainly not helping to meet the problems in my division in any way.

This debate today is another attempt by us to seek a co-ordinated energy policy for this country and to secure a proper balance in the use of imported and indigenous fuels. There are signs today that there are employers who have awakened to the fact that planning production is a far more effective way of promoting the performance we need from industry if we are to keep our jobs and our standard of life. How then can the coal industry plan ahead if it does not know what is required of it in the future years?

The industry is being contracted to a position of trying to bring its production in line with expected demand. Last year the figure of consumption was about 203 million tons, which was higher than expected, while production was lower than we expected. Manpower was down to 583,000, which was 12,000 fewer than the Coal Board planned. During these years our young men have been leaving at a substantial rate, and many of these young men are tradesmen who are most essential now in the mining industry as it becomes highly mechanised.

It has to be remembered that in 1960 the average level of economic activity was much higher than in 1959 and much higher than in 1957 and 1958 which were years of stagnation. The year 1960 was exceptional in that the total energy required rose from 246 million tons in 1959 to 262 million tons in 1960. I ask the Minister, will this continue in 1961? It would not be wise to assume a similar increase in 1961 in either total energy demand or coal demand.

The general economic prospects are not too good. Industrial production has been stationary for quite a while now and many industries have deteriorated rapidly recently. Then there is the balance of payments problem. Any fall in economic activity in 1961 is bound to have a direct effect on the demands for coal. The Coal Board's plan for 1961 itself envisages coal disposals at 197 million tons, 34 pits to close and production reduced to 184 million tons. In 1960 inland coal consumption went up by 4 per cent. Oil consumption went up by 40 per cent., while fuel imports rose by nearly 50 per cent.

These figures must be viewed against the increase in total oil consumption from 37 million tons in 1957 to nearly 60 million tons in 1960, or an increase in fuel oil consumption from 11.8 million tons of coal equivalent in 1957 to 25 million tons of coal equivalent in 1960, and this against a background of overproduction of oil. There are no signs that the competitive pressure on coal is lessening in any way. Today we depend for one-quarter of our energy requirements on imported oil, and into this picture must come the threat to coal from the importation of liquid methane now contemplated by some of the gas boards.

Any over-dependence of the British economy on imported oil is fraught with dangers not only because of our balance of payments problem but because of the political instability in the oil-producing areas. We have had the example of Suez. After Suez there was a revolution in Iraq, and before Suez there was Abadan. It must also not be forgotten that recently the oil-producing countries have joined together to form a new organisation with a view to restricting production, raising oil prices and obtaining a larger share of the profits.

How can anyone in the Committee say that the Sahara will be French in five years' time? Yet it is said that negotiations are taking place with a gas board in this country to import methane on a 20-year agreement. We know to our cost in this Committee of the rise of nationalism in the areas for which we are responsible in Africa. But it does not stop in those areas. It is happening over the whole of Africa. To talk of a 20-year contract in this context to the detriment of gas-coal is not at all in the national interest.

What about the long-term view? The Coal Board's revised plan for 1965 was based on the Government's estimate of 300 million tons of coal equivalent as our energy requirement. Its experts now put our energy requirement at 280 million tons of coal equivalent by 1965. Our union has studied this question and its studies have produced a similar result. On this basis, and with the recent trend in the growth of oil consumption, if there is no change in the Government's present policy, the share of coal by 1965 will be about 180 million tons. Let me make it clear that we do not want that position; we want the minimum figure of 200 million tons of coal in the British economy.

I noticed that in a note to the National Union of Mineworkers the Minister says that he considers our figures are too cautious and that the nation will need 200 million tons in 1965. If that is the Government's view, why do they not guarantee this figure and let us build the industry to meet it? If there is no change in Government policy and if we fail to get such a guarantee from the Government, we must not blind ourselves to present trends.

The uncertainty about the industry's future is not conducive, nor will it be conducive, to solving the manpower problem. Manpower comes mainly from the mining villages. The men have seen three years of contraction, which has been humanely done. They see that there is no guarantee by the Government of what is coal's rightful place in the economy, and they recognise that the Government say that they must be subjected to free competition in the fuel industries. That is what is creating in people's minds a lack of confidence in the industry and why they are seeing that their lads go to other industries. It is causing young men, who are so vital to the industry, to leave in their thousands and it is bringing the average age of the miner to a higher figure than I have known it for many years.

I am convinced that if the Government were to determine that 200 million tons of coal was our part in the economy, and the machinery of Government was used to that end, and if we had a co-ordinated policy for our fuel requirements, the coal industry could be planned to meet it. Otherwise, in our opinion, it is not possible to plan ahead at all.

I will say a word or two on prices, wages and the revenue deficit about which the Minister spoke today. The facts support our opinion that the financial difficulties of the Coal Board do not come from circumstances within the industry itself. The costs of production have been reduced: there has been a reduction of £50 million in the last three years; in 1959 there was a reduction in cost of 1s. 6d. per ton; there has been an increase in efficiency in the industry and over the last three years output per man shift has increased by 13 per cent. From the standpoint of the internal operations of the industry, there is no basis to suppose that financial difficulties should have existed for the Coal Board. However, they do exist, and they exist solely as a consequence of political impositions forced upon the industry as a result of Government policy. The great probability is that the increase last October will help to reduce the deficit that was anticipated.

The increase in price last year was not introduced in order to meet wage increases or as benefits accruing to manpower employed at the pits. The increase, which, as the Minister said, was substantial, resulted from the determination of the Board to try to put an end to deficiency financing. The purpose of the price increases was in the main to try to get some way towards financial solvency for the Board. In fact, it was a measure taken by the Board economically within the industry to meet the cost of the political policies which are imposed upon the industry by the Government. Time and time again this side of the House has argued about the liabilities which have been placed on the industry in the last ten years, and the House is most certainly acquainted with them.

I should like to deal with the gas industry and coal. The gas industry has notable achievements to its credit since it was nationalised. The demand for gas has increased by 12 per cent., and there has been increased technical efficiency and productivity. Yet, like coal, the gas industry faces some crucial problems with regard to its future. There is a startling discrepancy between the rapid growth in demand for electricity and oil on the one hand and the slow growth in demand for gas on the other. The implication for the future of this discrepancy in growth is a high price of gas, for technically gas is a most satisfactory form of fuel for many industrial processes and domestic heating. It is clear, therefore, that the future of gas must be based on a lower costs of production, and I believe that if the price could be reduced gas would have a good future and in these days of competition, about which we have heard so much, it would help the industry to compete within the fuel industries.

So we are forced to the conclusion that any substantial reduction in the costs of producing gas is unlikely to be obtained by the existing technical process of carbonisation. So the main alternatives we face are the complete gasification of low grade coal or the large importation of natural gas from abroad, either in liquid form or by pipeline. In my opinion, in the interests of coal and the interests of the nation we should be linked up with the complete gasification of coal rather than with imported gas projects. If we adopt imported gas projects, it will mean an increased burden on our balance of payments, and there will be little to choose between importing natural gas and increasing our oil imports. But the gasification of coal will mean a capital expenditure which will be in Britain, while the other way much of it will be abroad. The use of low-grade coals would, however, mean the utilisation of our own fuel, and it would secure our market and, indeed, possibly bring about an expanding one.

However, this subject—I am not technically qualified to deal with the question of comparative costs—is dealt with in the Wilson Report and in two recent articles in the Economist. I have talked to some experts in this field, and they seem to draw the conclusion that there is not a great deal to choose on the ground of costs; that is, between the possible price of imported natural gas and the possible price from low-grade coal.

It is important to bear in mind that if we are to reap the full economic and technical benefits of these plants, they must be on a very large scale. I suggest that the Lurgi plants should be on the scale of taking one million tons of coal per annum, and be adjacent to collieries in order to cut transport costs. I believe that costs could be further cut by developing the Lurgi process and using the slagging thick bed pressure process.

I know that some people in the gas industry are sick of coal, and that the possibility of buying light petroleum hydro-carbons such as natural gas and methane from sources abroad is a great attraction. But this will mean getting the country's gas from imports.

I will give one example. We are informed that proposals are to be submitted to the Minister by the North Thames Gas Board for the import of natural gas from the Sahara. I understand the proposal is that it should import about 38 milliard cubic feet a year. An import of this size would replace 4 million tons of gas coal a year, and the greater part of this loss would fall upon the Durham coalfield, which is already contracting. Four million tons of coal represents the annual output of 16,000 Durham miners.

At the present time, there is a surplus of gas coal, and if this proposal were accepted it would mean the contraction of large pits, still with years and years of reserves of coal in them, and upon which millions of pounds have been spent in modernisation.

It would also hit our collier trade, and shipping is in a bad enough way now without aggravating it any further. Coastwise shipping has been diminishing for quite a while, and ships will not be built if no encouragement is given to their employment.

I ask the Minister how much the Gas Council has spent on research into Lurgi plants and how much on the gasification of oil. The Council's plans up to 1965 show that there is a tendency to desert the coal industry, because if we look at the plans, the proportion of gas from coal will be reduced from the present 65 per cent. available to 55 per cent. by 1966, and it could possibly be much less if the importation of methane were allowed on a large scale.

It is because of the Government's concept of lively competition between the nationalised industries that we say to them that to sanction imported methane on the scale contemplated by the gas industry will make the position of the coal industry even worse than we visualise it today.

I promised to sit down at 9.30 p.m., but I should like to say a word or two about fuel oil. The inland consumption of oil in the last four years has been to the detriment of the coal industry, and I do not want to go over the ground covered by my hon. Friend the Member for Southwark.

What I fail to understand in the refining of oil is why fuel oil is regarded as a residual product. One finds that when one looks at the refineries. One cannot consider fuel oil as a residual product when it accounts for over 40 per cent. of the total petroleum products of the oil refinery whereas motor spirit accounts for only 25 per cent. of the total.

We find also that over the three years 1957–60 fuel oil consumption rose by 150 per cent. I support my hon. Friend the Member for Southwark in asking for the resurrection of the tax which the Tories put on in 1935, which we took off in 1947 during the coal shortage, and which would have been put on long before now had the coal owners been sitting on that side of the Committee.

Mr. Nabarro

Certainly not.

Mr. Blyton

My hon. Friends have dealt with the other aspects of our fuel problems, but I would remind the House that fuel and power are of vital concern to us. We take the view that fuel and power policy cannot be left solely to the free play of the market. There must be some conscious Government policy for this industry for the following reasons. First, because of the basic importance of fuel and power to our economy. Secondly, because the fuel industries must plan many years ahead. Thirdly, because we have our own indigenous fuel.

Consumer choice is not by itself a coherent fuel and power policy for this country. None of the policies which we have put forward interfere with consumer choice in the sense of trying to direct people about the type of fuel they should use. We should seek to influence their choice by the use of fiscal measures which no one can deny is an accepted theme of Government economic activity.

At what point will equilibrium be achieved in this industry? To what size is the industry to be cut? Is the cut to be determined by economic jungle law? If this process is not changed we will not get the men into the industry and there will be disastrous results in the years ahead.

Having taken an interest in fuel and power matters for many years, I am satisfied that ever since Lord Mills was Minister of Fuel and Power oil interests have been regarded as paramount to the detriment of coal. I regard Lord Mills as the greatest disaster suffered by the coal industry.

Mr. Nabarro

Lord Mills was a jolly good chap.

Mr. Blyton

The men who saw the poster, "Looking for work with a future? Coal mining gives you a good job" feel that they have been let down. As pits closed and stocks started to pile up in the colliery yards they advised their sons to seek work elsewhere.

Mr. Nabarro

Lord Mills published it.

Mr. Blyton

It is no use the hon. Member for Kidderminster (Mr. Nabarro) or the Minister giving us lectures about running down this industry, when the Government, by their policies, have created a lack of confidence in the industry over the last four years.

In conclusion, I put these questions to the Government. Do the Government face without apprehension the importation of 90 million tons of coal equivalent in 1965 and the dependence of our national economy upon imported fuels for one-third of its energy requirements? Do they not have any qualms at all about what will be the effects of such massive oil imports on the balance of payments problem? Do they not consider it highly dangerous to make us too dependent on an imported fuel in a world so uncertain as it is today? The Government cannot expect us to remain passive onlookers at the strangulation of our native industry and the destruction of the social and cultural life of our mining communities by the processes of economic anarchy and cut-throat competition.

Mr. Nabarro

Nonsense.

Mr. Blyton

We have gone through this before. We suffered much. Our memories are still bitter. We see the trends and we see Government policy working relentlessly to strangle this great industry, upon which Britain's prosperity has been built. We ask all our colleagues tonight to register their protest in the Division Lobbies against the Government's policy.

9.31 p.m.

The Parliamentary Secretary to the Ministry of Power (Mr. J. C. George)

rose—

Mr. Richard Marsh (Greenwich)

On a point of order. As there are so few Government supporters now present—only about twenty—would it be possible for one of the staff to see if the annunciators in the bars are still working?

The Chairman (Sir Gordon Touche)

That is not a point of order.

Mr. Nabarro

I am here, anyway.

Mr. George

I can fully understand hon. Members opposite having anxieties about the mining industry and having had them for several years. However, it is unworthy of them, even with those anxieties, continuously to attribute to this side of the Committee a desire to continue and expand those anxieties into the future, especially when there has been in the past three years a policy, with Government assistance, of sheltering redundancy unequalled in this or any other country. Money was advanced by the Government in order to allow the National Coal Board to accumulate stocks—not stocks for any ordinary industrial purpose, but stocks for one single purpose, namely, to save men from pain. The stocks were accumulated and the rundown of the industry was managed in a controlled fashion. We have now reached a period of stability, and no one has been seriously hurt.

Looking at that process over the past three years as honest men and not as biassed men, can we not feel that the past is a guide to the future? If the industry falls again upon bad times, the Government who then came to its rescue along with the National Coal Board will do it again in the future.

All I ask hon. Gentlemen to do is to look at the circumstances of today and ask whether the anxieties which have been expressed have any foundation in reality. We have heard ominous phrases used, for instance, by the hon. Member for Ebbw Vale (Mr. M. Foot), about alarm and growing concern in the coal fields. I could have understood that three or even two years ago, but I do not believe it today.

Mr. Iorwerth Thomas (Rhondda West)

The Parliamentary Secretary's statement may have left hon. Members with the impression that the Government have advanced money to the National Coal Board for the purpose of providing a cushion in regard to stocking. Do I understand that the National Coal Board will have to repay the capital and interest on the money advanced?

Mr. George

Advances normally have to be repaid.

Let us look at the position rationally, forgetting about the T.U.C. leaflet and the T.U.C. policy. Let us consider the mining industry as it stands today. Are there grounds for all the anxieties which have been expressed today? [HON. MEMBERS: "Yes."] When there is still anxiety about recruitment, does it do that campaign any good to repeat that there is alarm and fear in the coal fields?

We should not carry into the 1960s the spirit of the late 1950s. We need a buoyancy. By their speeches today hon. Members opposite have shown that time and events have passed them by. They have not managed to capture the spirit of their late colleague and present Chairman of the National Coal Board, who is facing the 1960s with optimism and buoyancy, and not without reason in view of what has happened in the last year. Consumption has risen sharply, and no matter how much hon. Members opposite may wish to deny it, consumption was up in 1960 and output per man shift has steadily increased and manpower losses have been checked.

The hon. Member for Ebbw Vale said that my right hon. Friend's statement showed that we were losing men at the rate of 350 per week, but my right hon. Friend continued his statement to say that in the first four weeks of this year the position had stabilised itself. We have thus moved from losing 1,400 men a week to stability.

Mr. Swain

Will the hon. Member agree—

Major W. Hicks Beach (Cheltenham)

Speak up.

Mr. Swain

The hon. and gallant Member can get a deaf aid from the National Health Service, although it will cost him two bob.

Mr. Nabarro

I cannot hear the hon. Member.

Mr. Swain

It is the Minister's time you are foolishly wasting.

Mr. Nabarro

On a point of order. The hon. Member said that you are foolish, Sir Gordon.

The Chairman

I did not think that the hon. Member intended anything of the sort.

Mr. Swain

Is the Parliamentary Secretary aware that every time a young man between the ages of 18 and 25 leaves the industry, the average age of the men in it increases? Does he think that it is an industry which can be efficiently operated with an ever-increasing age level?

Mr. George

I realise the importance of retaining as low an age level as possible, but the present age level is not as bad as has been said today. In 1957 the average age in the industry was 40.5, and in 1960 it was 41.5, so the position has not seriously worsened, in spite of the fact that 120,000 men have left the industry.

I was trying to point out that there were sound reasons for optimism. I said that consumption had risen, that output per man had increased and that manpower losses had been checked. Contraction has ended and stocks are being lifted, and a profit is being earned. Those are grounds for genuine optimism, so why do hon. Members opposite carry the misery of the 1950s into the 1960s? Hon. Members have been at pains to tell us how much has been suffered since 1957, but I say that we should leave the past behind. We should look at the facts today and go forward with confidence.

Having said that, I would not presume to say that the troubles of this industry are by any means finally ended. Neither did my right hon. Friend. Far from it. There are immense difficulties ahead and fierce challenges to be faced, but I would say again that progress has been made and there are real grounds for confidence in the future.

The charge has been made that in the rundown of this industry the Government have been apathetic, unaware and unconcerned, and it has been said that our policy has been to throw the men on to the scrap heap in 1957 and to try to bring them back again in 1960. This matter was dealt with at length by my right hon. Friend. The care taken by the National Coal Board, with the approval of the Government and of the House of Commons, to shelter the miner from redundancy and to maintain capacity completely demolishes the charge that the decline in the industry was unplanned. It may be that humanity in the industry in the past has been lacking, but in this case it has reached a new peak, and I would say that the country was glad that this action was taken. The aim has been reached and few have been hurt, and it is ungracious of hon. Members opposite to imply that the rundown was carried out by a heartless, apathetic and unconcerned Government.

There are several matters on which I should like to expand. My right hon. Friend has dealt with the main points, and I should like to expand on a few of the other matters that have been raised as there is time for nothing else. The hon. Member for Houghton-le-Spring (Mr. Blyton) expressed anxiety about the gas industry. He expressed fear that methane might be allowed to be imported into this country in large quantities. This matter has been raised in the House from time to time and my right hon. Friend has told the House that he has been awaiting firm proposals from the Gas Council. That is still the position. We know that these firm proposals will come within a reasonably short time, but at the moment he has nothing before him to consider. However, he has given the House an assurance that when he does have a scheme he will consider all aspects of the importation of methane, that he will consult with the National Coal Board, and that the decision, when it is taken, will, in his view, be the best in the national interest. Nobody's argument will be neglected when that decision is taken. Whether or not methane will be imported has yet to be decided, but he emphasised that in his view the future lay with gasification rather than methane.

The Gas Council is carrying out an investigation into the cost of Lurgi gas generation. The first Lurgi plant has come into commission at Westfield in Scotland, and so far is proceeding as expected. A second plant is being erected at Coleshill in the Midlands, and with the two in operation we shall gain experience of Lurgi gas manufacture. If the results of examination and experience show the Gas Council that the cheapest product will come from expanding Lurgi gas generation it will be expanded, but at this stage experiments are being con- ducted which will be watched with great care and all lessons will be learned.

The fact that the Gas Council has gone in for these expansive Lurgi plants is an earnest of its desire not to desert the coal industry, as has been suggested, but we have to live with facts. The gas industry is static. It has been unable to expand its sales in the last three or four years because the price of gas was chasing away the domestic consumer. If it is to retain the domestic consumer, who is the backbone of the gas industry, it has to find ways and means of stabilising the price. It has got gas from coke ovens. That has been increased, and, in doing this, coal has been consumed in the coke ovens. It has got methane from the mines, and that assists in promoting safety in the mines.

It has other forms of refinery gas and oil to help it in the task of keeping the industry healthy and in good heart, in the hope that these new allies will, in the future, allow it to expand and remain a good customer of coal. That is the hope of the gas industry. To that end, it is doing research but it must face realities and live if it is to be a good customer for coal. Its chief aim in life is not to desert coal by using oil. The industry is concerned to retain the connection with coal which it has had for many years, and I am glad to say that relations between the Gas Council and the National Coal Board have never been so good as they are today.

A great deal has been said about fuel oil imports, the balance of payments problem and the danger to this country and to the coal mining industry. This matter was raised by the hon. Member for Southwark (Mr. Gunter) in his opening speech, by my hon. Friend the Member for Kidderminster (Mr. Nabarro), by the hon. Member for Dewsbury (Mr. Ginsburg), and by other hon. Members.

Mr. Nabarro

I did not agree.

Mr. George

I said that the matter had been raised. The short answer to the charge that we are importing large quantities of fuel oil is that we are net exporters. Home production has exceeded inland deliveries over the years, and we expect this trend to continue in 1961. We must look at the whole field of fuel consumption and see whether there are areas where fuel is essential for the life of the country. For instance, more and more people are travelling by car, road transport is expanding, aviation is expanding, agriculture is using fuel, and so forth. These are uses in the intimate life of the nation which must be supplied.

Oil is needed by the consumer to supply his needs, and it is better that the country should import in the form of crude oil to be refined at home, and that the fuel oil left should be used to supply essential needs at home. If that fuel oil is left, it is better for it to be used here than for it to be exported or put to waste. A use should be found for it and, so long as we can confine our use of oil in this country to the product of our own refineries, I contend that any problem of security in our supplies is not a big one.

We are importing oil from many sources. Some time ago, we were confined within a narrow range of suppliers, but we have diversified our sources of supplies in recent years. New discoveries have been made in different parts of the world, and the diversification of supply has brought greater security. We have tankers in excess of need all over the world to bring in extra supplies if required. There is a vast amount of shut-down production in the world today. Moreover, we have not neglected our stocks at home to see us over a temporary emergency. Therefore, the security of our supplies is not in jeopardy in the way suggested in the debate.

If oil is an opponent of coal, it is by virtue of the fact that it is essential to the life of the nation. We are not importing fuel oil to use it in opposition to coal. Everything that is used is the product of our own refineries, and, as I said, we are a net exporter.

We have been told over and over again that oil imports to this country must be a burden on the balance of payments. In 1959, we imported mainly crude oil to the value of £470 million. These imports helped to sustain exports of at least £100 million outwards from our refineries, reducing that figure to £370 million. Moreover, much of the import bill is in sterling, from British concerns abroad and brought here in British ships. The British oil companies not only trade with this country but they sell four times as much oil abroad as we consume here. Also, they have brought to this country a new industry, the export of petroleum equipment. Half the orders in British shipyards since the war have been for tankers. I can give the Committee an assurance that our overseas oil is not a heavy cost to this country and not a heavy charge on the balance of payments.

Mr. Ginsburg

rose—

Mr. George

I am sorry. I cannot give way.

We have heard it suggested that opencast cuts should be made, but I want the Committee to realise what opencast cutting has meant to the Coal Board. This was the most profitable line of activity, and the Board made a profit in 1957 from opencast operations of £9 million. Last year, the figure had fallen to £4 million—a definite subsidy to aid redundancy of £5 million per year—and when the figures for 1960 are ready, I think we shall find a still greater sum being paid by the Coal Board for that rundown of the industry which was done in order to save the men concerned a great deal of pain. The Coal Board is committed to reduce opencast operation further, but has reduced it as far as it can without incurring tremendous expense in compensation which it considers beyond it at this time. Its programme will be carried out and opencast will be run down gradually.

One amazing complaint was made by the hon. Member for Southwark which showed how very far he is from being up to date on the question of the oil used in this country. He said that we should stop using it at power stations because there was no cost advantage by using oil. The hon. Gentleman must have been by-passed by events for him to make that statement today. The position is that the relative cost of the use of coal and oil in steam-driven power stations depends upon the location of the particular stations in relation to the supplies of the two fuels. Coal can compete with oil at stations sited near the coal fields. On the Thames Estuary and the South Coast, the costs of transporting coal are high, but oil is cheaply available from local refineries. In these locations it is about 30 per cent. more expensive to generate from coal than from oil, and at a large modern station such as Marchwood, it would cost about £2 a year more to operate on coal rather than on oil at the present time. That is the answer to the hon. Gentleman who made the statement that there was no cost advantage in using oil. He pleads that the dual-fired stations should be immediately changed over. We have already in past debates shown that the programme has been cut by 40 per cent. and that is a direct aid to the coal industry. We have had a remarkable increase in power consumption in the last year, and this has related to the question of the consumption of oil.

The load increase has almost doubled its rate in past years to about 13 per cent. The trend is about 6.9 per cent. per annum. That meant that every available piece of plant had to be ready for use at peak periods, and the Central Electricity Generating Board produced a remarkable performance in that 93 per cent. of its equipment was ready to go into use or in use at the end of the year. That had never been done before in the industry, and this extra demand resulted in the extra demand for coal rising above what was expected at the beginning of 1960 so that 5.5 million tons of additional coal was used by the Central Electricity Generating Board in 1960. It also meant that we were running the high-merit stations for longer hours, and the consumption of oil was high.

I am sure that both sides will be happy that if coal advances rapidly, oil consumption should also advance in step. 'The point is that all the plant is needed to meet peak demand. Therefore, the oil stations have had to run for longer periods than was expected at the beginning of 1960.

This will apply also to the future, I must warn the Committee. It was expected that the amount of oil used in dual-fired power stations would fall to 3 million tons in 1965, but that is unlikely to take place now. The plants now in use must be maintained, to meet the additional load, and if it holds as it is, the Generating Board will be hard pressed to keep hold of the situation next winter and in succeeding winters. All plant in commission, aided year by year with additional plant, will be required to hold this increased load if it keeps rising at anything like the 1960 figures. That means that more oil than was expected will be used in 1965.

Only a few minutes are still available to me and I must leave many points unanswered, but I will endeavour to write to hon. Members about them. I wish to make one further point about the industry. When this profitless exercise of backtracking is over, the main problem of the industry will still remain. That problem is productivity and more productivity. No grants or subsidies, neither targets nor taxes, will supply the answer. Eager and capable management and productivity consciousness can enable the new industry, created at great cost to serve its true purpose, to be an asset and not a liability, to regard its employees generously, to serve its customers well and be in the forefront of technical progress, as it should be.

Let me look to the future for the answer to the problem of the industry as I see it. This nation must export or cease to prosper. Therefore, fuel and power supplies must be ample and reasonably priced. Ten substantial rises in fourteen years are disquieting. We are in danger of losing our oldest and chief asset over our European competitors—cheap fuel. We have reached a position where the Government are reluctant to extend protection to the coal industry in case this creates a high energy cost nation. The Board cannot raise its prices further because it has already reached the point of no return. Nor can it afford to underpay its labour in a full employment economy even if it wished to do so.

The only answer is a rapid and continuing increase in productivity. This must be obtained by concentration upon high-speed faces underground and on the best collieries and moving the faces forward rapidly, making the best use of the machinery that we have purchased and the roads that we have made. Progress has been made to that end.

The output per yard of face in 1957 was 319 tons. It rose in 1959 to 345 Ions. That is the average. Output, per yard of face in some new collieries has reached 415 tons. These figures are through concentration. The European Coal and Steel Community countries have carried through mechanisation of concentration. The underground output per man shift since 1957 in the Community as a whole increased by 20 per cent. In the Ruhr it increased by 32 per cent. In this country in increased by 12 per cent.

Mr. Swain

The figure is 42 per cent. since 1947.

Mr. George

No—per cent. Output in the Ruhr is 2.1tons per shift against 1.8here. They have crossed the line. They are doing better than us and we must see what we can do to improve the situation.

There is a way in which we can do this. This is concentration. In 1947 an old colliery through reconstruction and concentration, produced half a million tons with an o.m.s. of cwt. This colliery, with fewer men, is now producing 1 million tons with an o.m.s. of 66 cwt.

Mr. Swain

Is that only 12 per cent.?

Mr. George

That is for one colliery.

The example to be followed is quite clear. We have created expensive collieries costing millions of pounds. To work them on one shift would be death. To work them on two shifts would enable them to pay their way. If they are worked on three shifts they will be highly profitable. The industry must have a faster advance if it is to live prosperously and to pay its people well. It must press forward on these lines, working on the best pits, concentrating on the best faces and having faster advance.

Question put:—

The Committee divided: Ayes 223, Noes, 299.

Division No. 58.]	AYES	[10.0 p.m.
Abse, Leo	Evans, Albert	Lawson, George
Ainsley, William	Fernyhough, E.	Ledger, Ron
Albu, Austen	Finch, Harold	Lee, Frederick (Newton)
Allaun, Frank (Salford, E.)	Fitch, Alan	Lee, Miss Jennie (Cannock)
Allen, Scholefield (Crewe)	Fletcher, Eric	Lever, Harold (Cheetham)
Awbery, Stan	Foot, Michael (Ebbw Vale)	Lever, L. M. (Ardwick)
Bacon, Miss Alice	Forman, J. C.	Lewis, Arthur (West Ham, N.)
Baird, John	Fraser, Thomas (Hamilton)	Lipton, Marcus
Baxter, William (Stirlingshire, W.)	Galtskell, Rt. Hon. Hugh	Loughlin, Charles
Beaney, Alan	Ginsburg, David	Mabon, Dr. J. Dickson
Bellenger, Rt. Hon. F. J.	Gordon Walker, Rt. Hon. P. C.	McCann, John
Bence, Cyril (Dunbartonshire, E.)	Gourlay, Harry	MacColl, James
Benson, Sir George	Greenwood, Anthony	McInnes, James
Blackburn, F.	Grey, Charles	McKay, John (Wallsend)
Blyton, William	Griffiths, Rt. Hon. James (Llanelly)	Mackie, John
Boardman, H.	Griffiths, W. (Exchange)	McLeavy, Frank
Bowden, Herbert W. (Leics, S.W.)	Gunter, Ray	MacMillan, Malcolm (Western Isles)
Bowles, Frank	Hall, Rt. Hon. Glenvil (Colne Valley)	Mallalieu, E. L. (Brigg)
Boyden, James	Hamilton, William (West Fife)	Mallalieu, J. P. W.(Huddersfield, E.)
Braddock, Mrs. E. M.	Hannan, William	Manuel, A. C.
Brockway, A. Fenner	Hart, Mrs. Judith	Mapp, Charles
Broughton, Dr. A. D. D.	Hayman, F. H.	Marquand, Rt. Hon. H. A.
Brown, Alan (Tottenham)	Henderson, Rt. Hn. Arthur (RwlyRegis)	Marsh, Richard
Brown, Rt. Hon. George (Belper)	Hewitson, Capt. M.	Mason, Roy
Butler, Herbert (Hackney, C.)	Hill, J. (Midlothian)	Mayhew, Christopher
Butler, Mrs. Joyce (Wood Green)	Hilton, A. V.	Mellish, R. J.
Callaghan, James	Holman, Percy	Mendelson, J. J.
Castle, Mrs. Barbara	Houghton, Douglas	Millan, Bruce
Chetwynd, George	Howell, Charles A.	Milne, Edward J.
Cliffe, Michael	Hoy, James H.	Mitchison, G. R.
Collick, Percy	Hughes, Cledwyn (Anglesey)	Monslow, Walter
Corbet, Mrs. Freda	Hughes, Emrys (S. Ayrshire)	Moody, A. S.
Cronin, John	Hughes, Hector (Aberdeen, N.)	Morris, John
Crosland, Anthony	Hunter, A. E.	Moyle, Arthur
Crossman, R. H. S.	Hynd, H. (Accrington)	Mulley, Frederick
Cullen, Mrs. Alice	Hynd, John (Attercliffe)	Neal, Harold
Darling, George	Irvine, A. J. (Edge Hill)	Noel-Baker, Francis (Swindon)
Davies, G. Elfed (Rhondda, E.)	Irving, Sydney (Dartford)	Noel-Beker, Rt. Hn. Philip (Derby, S.)
Davies, Harold (Leek)	Janner, Sir Barnett	Oliver, G. H.
Davies, S. O. (Merthyr)	Jay, Rt. Hon. Douglas	Oram, A. E.
Deer, George	Jeger, George	Oswald, Thomas
de Freitas, Geoffrey	Jenkins, Roy (Stechford)	Owen, Will
Delargy, Hugh	Johnson, Carol (Lewisham, S.)	Padley, W. E.
Diamond, John	Jones, Rt. Hn. A. Creech(Wakefield)	Paget, R. T.
Dodds, Norman	Jones, Dan (Burnley)	Pannell, Charles (Leeds, W.)
Donnelly, Desmond	Jones, Elwyn (West Ham, S.)	Pargiter, G. A.
Driberg, Tom	Jones, Jack (Rotherham)	Parker, John (Dagenham)
Dugdale, Rt. Hon. John	Jones, J. Idwal (Wrexham)	Parkin, B. T. (Paddington, N.)
Ede, Rt. Hon. C.	Jones, T. W. (Merioneth)	Pavitt, Laurence
Edelman, Maurice	Kelley, Richard	Pearson, Arthur (Pontypridd)
Edwards, Rt. Hon. Ness (Caerphilly)	Kenyon, Clifford	Peart, Frederick
Edwards, Robert (Bilston)	Key, Rt. Hon. C. W.	Pentland, Norman
Edwards, Walter (Stepney)	King, Dr. Horace	Plummer, Sir Leslie
Popplewell, Ernest	Smith, Ellis (Stoke, S.)	Wainwright, Edwin
Prentice, R. E.	Snow, Julian	Warbey, William
Price, J. T. (Westhoughton)	Sorensen, R. W.	Watkins, Tudor
Probert, Arthur	Soskice, Rt. Hon. Sir Frank	Weitzman, David
Proctor, W. T.	Spriggs, Leslie	Wells, Percy (Faversham)
Pursey, Cmdr. Harry	Steele, Thomas	Wells, William (Walsall, N.)
Randall, Harry	Stewart, Michael (Fulham)	White, Mrs. Eirene
Rankin, John	Stones, William	Whitlock, William
Redhead, E. C.	Strachey, Rt. Hon. John	Wigg, George
Reid, William	Strauss, Rt. Hn. G. R. (Vauxhall)	Wilcock, Group Capt. C. A. B.
Reynolds, G. W.	Swain, Thomas	Wilkins, W. A.
Roberts, Albert (Normanton)	Swingler, Stephen	Willey, Frederick
Roberts, Goronwy (Caernarvon)	Sylvester, George	William, LI. (Abertillery)
Robinson, Kenneth (St. Pancras, N.)	Symonds, J. B.	Willis, E. G. (Edinburgh, E.)
Ross, William	Taylor, Bernard (Mansfield)	Wilson, Rt. Hon. Harold (Huyton)
Shinwell, Rt. Hon. E.	Thomas, George (Cardiff, W.)	Winterbottom, R. E.
Silverman, Julius (Aston)	Thomas, Iorwerth (Rhondda, W.)	Woodburn, Rt. Hon. A.
Silverman, Sydney (Nelson)	Thompson, Dr. Alan (Dunfermline)	Woof, Robert
Skeffington, Arthur	Thomson, G. M. (Dundee, E.)	Yates, victor (Ladywood)
Slater, Mrs. Harriet (Stoke, N.)	Thornton, Ernest	Zilliacus, K.
Slater, Joseph (Sedgefield)	Tomney, Frank	TELLERS FOR THE AYES:
Small, William	Ungoed-Thomas, Sir Lynn	Mr. John Taylor and
		Mr. Rogers.
NOES
Agnew, Sir Peter	Craddock, Sir Beresford	Heald, Rt. Hon. Sir Lionel
Aitken, W. T.	Critchley, Julian	Henderson-Stewart, Sir James
Allan, Robert (Paddington, S.)	Crosthwaite-Eyre, Col. O. E.	Hendry, Forbes
Aliason, James	Crowder, F. P.	Hicks Beach, Maj. W.
Arbuthnot, John	Cunningham, Knox	Hiley, Joseph
Ashton, Sir Hubert	Curran, Charles	Hill, Dr. Rt. Hon. Charles (Luton)
Atkins, Humphrey	Currie, G. B. H.	Hill, Mrs. Eveline (Wythenshawe)
Balniel, Lord	Dalkeith, Earl of	Hill, J. E. B. (S. Norfolk)
Barber, Anthony	Dance, James	Hinchingbrooke, Viscount
Barlow, Sir John	Davies, Rt. Hn. Clement(Montgomery)	Hirst, Geoffrey
Barter, John	d'Avlgdor-Goldsmid, Sir Henry	Hocking, Philip N.
Batsford, Brian	Deedes, W. F.	Holland, Philip
Baxter, Sir Beverley (Southgate)	de Ferranti, Basil	Hollingworth, John
Beamish, Col. Sir Tufton	Digby, Simon Wingfield	Holt, Arthur
Bell, Ronald	Donaldson, Cmdr. C. E. M.	Hope, Rt. Hon. Lord John
Bennett, F. M. (Torquay)	Doughty, Charles	Hopkins, Alan
Berkeley, Humphry	Drayson, G. B.	Hornsby, R. P.
Bevins, Rt. Hon. Reginald (Toxteth)	du Cann, Edward	Hornsby-Smith, Rt. Hon. Patricia
Bidgood, John C.	Duthie, Sir William	Howard, Hon. G. R. (St. Ives)
Biggs-Davison, John	Eccles, Rt. Hon. Sir David	Howard, John (Southampton, Test)
Birch, Rt. Hon. Nigel	Eden, John	Hughes Hallett, Vice-Admiral John
Bishop, F. P.	Elliot, Capt. Walter (Carshalton)	Hughes-Young, Michael
Black, Sir Cyril	Emery, Peter	Hutchison, Michael Clark
Bossom, Clive	Emmet, Hon. Mrs. Evelyn	Irvine, Bryant Godman (Rye)
Bourne-Arton, A.	Errington, Sir Eric	Jackson, John
Bowen, Roderic (Cardigan)	Erroll, Rt. Hon. F. J.	James, David
Box, Donald	Farey-Jones, F. W.	Jenkins, Robert (Dulwich)
Boyd-Carpenter, Rt. Hon. John	Farr, John	Jennings, J. C.
Boyle, Sir Edward	Fell, Anthony	Johnson, Dr. Donald (Carlisle)
Braine, Bernard	Finlay, Graeme	Johnson, Eric (Blackley)
Brewis, John	Fisher, Nigel	Johnson Smith, Geoffrey
Bromley-Davenport, Lt.-Col. Sir Walter	Fraser, Ian (Plymouth, Sutton)	Jones, Rt. Hn. Aubrey (Hall Green)
Brooke, Rt. Hon. Henry	Freeth, Denzil	Joseph, Sir Keith
Brooman-White, R.	Gammans, Lady	Kaberry, Sir Donald
Browne, Percy (Torrington)	Gardner, Edward	Kerans, Cdr. J. S.
Bryan, Paul	George, J. C. (Pollok)	Kerby, Capt. Henry
Bullard, Denys	Glyn, Dr. Alan (Clapham)	Kerr, Sir Hamilton
Bullus, Wing Commander Eric	Glyn, Sir Richard (Dorset, N.)	Kershaw, Anthony
Burden, F. A.	Goodhart, Philip	Kimball, Marcus
Butcher, Sir Herbert	Goodhew, Victor	Kirk, Peter
Butler, Rt.Hn.R.A.(Saffron Walden)	Gough, Frederick	Lancaster, Col. C. G.
Campbell, Sir David (Belfast, S.)	Gower, Raymond	Langford-Holt, J.
Campbell, Gordon (Moray & Nairn)	Grant-Ferris, Wg Cdr. R.	Leather, E. H. C.
Carr, Compton (Barons Court)	Green, Alan	Leavey, J. A.
Carr, Robert (Mitcham)	Gresham Cooke, R.	Legge-Bourke, Sir Harry
Cary, Sir Robert	Grimond, J.	Lewis, Kenneth (Rutland)
Channon, H. P. G.	Grimston, Sir Robert	Lilley, F. J. P.
Chataway, Christopher	Grosvenor, Lt.-Col. R. G.	Lindsay, Martin
Clark, William (Nottingham, S.)	Gurden, Harold	Linstead, Sir Hugh
Clarke, Brig. Terence (Portsmth, W.)	Hall, John (Wycombe)	Litchfield, Capt. John
Cleaver, Leonard	Hamilton, Michael (Wellingborough)	Longbottom, Charles
Cole, Norman	Hare, Rt. Hon. John	Longden, Gilbert
Cooper, A. E.	Harris, Frederic (Croydon, N. W.)	Loveys, Walter H.
Cooper-Key, Sir Neill	Harrison, Brian (Maldon)	Low, Rt. Hon. Sir Toby
Cordeaux, Lt.-Col. J. K.	Harrison, Col. J. H. (Eye)	Lucas, Sir Jocelyn
Cordle, John	Harvey, Sir Arthur Vere (Macclesf'd)	Lucas-Tooth, Sir Hugh
Costain, A. P.	Harvey, John (Walthamstow, E.)	McAdden, Stephen
Coulson, J. M.	Harvie Anderson, Miss	MacArthur, Ian
Courtney, Cdr. Anthony	Hastings, Stephen	McLaren, Martin
		Maclay, Rt. Hon. John

McMaster, Stanley R.	Pitt, Miss Edith	Taylor, Sir Charles (Eastbourne)
Macmillan, Maurice (Halifax)	Pott, Percivall	Taylor, Edwin (Bolton, E.)
Macpherson, Niall (Dumfries)	Powell, Rt. Hon. J. Enoch	Taylor, W. J. (Bradford, N.)
Maddan, Martin	Price, David (Eastleigh)	Teeling, William
Maginnis, John E.	Price, H. A. (Lewisham, W.)	Temple, John M.
Maitland, Sir John	Prior, J. M. L.	Thatcher, Mrs. Margaret
Manningham-Buller, Rt. Hn. Sir R.	Prior-Palmer, Brig. Sir Otho	Thomas, Leslie (Canterbury)
Markham, Major Sir Frank	Profumo, Rt. Hon. John	Thomas, Peter (Conway)
Marlowe, Anthony	Proudfoot, Wilfred	Thompson, Kenneth (Walton)
Marples, Rt. Hon. Ernest	Quennell, Miss J. M.	Thompson, Richard (Croydon, S.)
Marten, Neil	Ramsden, James	Thorpe, Jeremy
Mathew, Robert (Honiton)	Rawlinson, Peter	Tiley, Arthur (Bradford, W.)
Matthews, Gordon (Meriden)	Redmayne, Rt. Hon. Martin	Tilney, John (Wavertree)
Maxwell-Hyslop, R. J.	Rees-Davies, W. R.	Turton, Rt. Hon. R. H.
Maydon, Lt.-Cmdr. S. L. C.	Renton, David	Tweedsmuir, Lady
Mills, Stratton	Ridley, Hon. Nicholas	van Straubenzee, W. R.
Montgomery, Fergus	Ridsdale, Julian	Vane, W. M. F.
More, Jasper (Ludlow)	Rippon, Geoffrey	Vaughan-Morgan, Sir John
Morgan, William	Roberts, Sir Peter (Heeley)	Vickers, Miss Joan
Morrison, John	Robson Brown, Sir William	Vosper, Rt. Hon. Dennis
Mott-Radclyffe, Sir Charles	Roots, William	Wade, Donald
Nabarro, Gerald	Royle, Anthony (Richmond, Surrey)	Wakefield, Edward (Derbyshire, W.)
Neave, Airey	Russell, Ronald	Wall, Patrick
Nicholls, Sir Harmar	Sandys, Rt. Hon. Duncan	Ward, Dame Irene
Nicholson, Sir Godfrey	Scott-Hopkins, James	Watkinson, Rt. Hon. Harold
Noble, Michael	Seymour, Leslie	Watts, James
Nugent, Sir Richard	Sharples, Richard	Webster, David
Oakshott, Sir Hendrie	Shaw, M.	Wells, John (Maidstone)
Orr-Ewing, C. Ian	Shepherd, William	Whitelaw, William
Osborn, John (Hallam)	Simon, Rt. Hon. Sir Jocelyn	Williams, Dudley (Exeter)
Osborne, Cyril (Louth)	Skeet, T. H. H.	Williams, Paul (Sunderland, S.)
Page, John (Harrow, West)	Smithers, Peter	Wills, Sir Gerald (Bridgwater)
Page, John (Harrow, West)	Smyth, Brig. Sir John (Norwood)	Wilson, Geoffrey (Truro)
Pannell, Norman (Kirkdale)	Speir, Rupert	Wolrige-Gordon, Patrick
Partridge, E.	Stanley, Hon. Richard	Wood, Rt. Hon. Richard
Pearson, Frank (Clitheroe)	Stevens, Geoffrey	Woodhouse, C. M.
Peel, John	Stodart, J. A.	Woodnutt, Mark
Percival, Ian	Stoddart-Scott, Col. Sir Malcolm	Woollam, John
Pickthorn, Sir Kenneth	Studholme, Sir Henry	Worsley, Marcus
Pike, Miss Mervyn	Summers, Sir Spencer (Aylesbury)	TELLERS FOR THE NOES:
Pilkington, Sir Richard	Tapsell, Peter	Mr. Gibson-West and
Pitman, I. J.		Mr. Chichester-Clark.

Original Question put and agreed to.

Resolution to be reported.

Report to be received Tomorrow:

Committee to sit again Tomorrow.