HC Deb 20 November 1962 vol 667 cc1020-130

Order for Second Reading read.

4.0 p.m.

The Parliamentary Secretary to the Ministry of Power (Mr. John Peyton)

I beg to move, That the Bill be now read a Second time.

This is a short and, I think the House will agree, an inoffensive Measure. It might even be described as simple, so far as that word can ever be applied with fairness or accuracy to any modern piece of legislation.

I know that the House will want to take the opportunity of this Second Reading debate to have a more general and wider-ranging discussion of the affairs of this industry. The House will recall that my right hon. Friend the Minister of Power on 23rd July, in an Answer in the House, stated the financial target which he had agreed with the National Coal Board and that he referred briefly then to some of the problems and difficulties confronting the industry. Before I come to deal with the detailed provisions of the Bill, I should like to enlarge somewhat on what my right hon. Friend was able to say on that day.

Perhaps at this stage I might be allowed, on a personal note, as a relative newcomer to the affairs and problems of this immense industry, to say that I am not unconscious either of its traditions or of its quite extraordinary impact upon the lives and characters of those who work in it. In dealing with its problems, and particularly its economic problems, as anyone in my place is bound to do, I should not like it to be thought that I am either wholly ignorant or careless of the personal difficulties and hardships which are enevitably involved in the process of this industry reshaping itself to meet what is perhaps the greatest challenge in its history.

If I may, I should like to take this opportunity early in my speech, because it is the first chance that either my right hon. Friend or I have had, to refer to the recent Barony Colliery disaster. This was a grave and terrible occurrence. I know that I have the whole House with me in extending to the relatives of the men who died our very sincere sympathy. The House will not, I know, expect me to give any estimate at this early stage of the extent of the damage, which is known to be serious. All I would like to say now is that it is receiving the very careful examination of the Coal Board and that both the Board and the Government are fully conscious of the most unwelcome employment problem that this disaster has posed in the locality.

The background to the review which my right hon. Friend and the Board recently carried out of the prospects of the industry was the unexpected contraction of the coal market, which began in 1957. This gave rise both to financial difficulties and to a mounting deficit. It was to meet this situation that the Government introduced last year, as a temporary measure, the 1961 Act, while the longer-term prospects of the industry were being considered.

The House will also recall that in April of last year the White Paper on the Financial and Economic Obligations of the Nationalised Industries made it necessary for appropriate objectives to be fixed for the coal industry. From 1945 until well on into the 1950s the main object of the industry had been a perfectly simple one—getting enough coal to meet a rising demand which it was confidently expected would continue both here and in Europe. But towards the end of 1957 things changed, and changed seriously. A moderate recession, increased fuel efficiency and the increasing use of other fuels reversed the trend of demand. A decline set in and continued for the next two years, while stocks mounted up.

It must be, I think, the primary aim of the coal industry so long as it has an excess of capacity to increase efficiency and not the volume of production. It is with that purpose in mind that the Board has recently been stepping up its investment in mechanisation and, at the same time, pruning investment in major reconstruction and new pits. This policy has led both to increasing productivity and to substantial capital savings. But despite it, there is still a substantial amount of new capacity which will conic into being in the next few years.

This is the fruit of investment which has been begun in past years, and now that we have it, or are shortly to have it, it is clear that it must be used to the full. But it can only be so used—and this is a very serious problem for the industry—if its output is permitted to replace the output of the older and higher-cost pits.

It is, therefore, the policy of the Coal Board to close down those pits which are unable to cover their operating costs, let alone make any contribution to depreciation and other fixed charges.

Mr. Gerald Nabarro (Kidderminster)

Hear, hear.

Mr. Peyton

We have to face the fact that such pits damage the prospects of the industry. They occupy a place in the fuel market which could and should be filled by those able to show better results. I am aware, of course, that to the men involved, those who are working in these older pits, such a policy must often seem harsh and, indeed, incomprehensible; but I am, nevertheless, convinced that the Board is taking the only course possible if it is to achieve what is, I would have thought, its most vital objective, that of preserving for coal a substantial share of a competitive fuel market. I believe that this is the only way of safeguarding the whole future livelihood of the mining community.

During the next few years output will inevitably be further concentrated in those collieries which, either because of geological advantages or ready access to markets or better productivity, are able to make coal competitive. That means that a continuing reduction in the total labour force will be accompanied by a movement of men not only between pits but also to some extent between coalfields. The Board's record—and I know that it will be the desire of all hon. Members to be fair—in handling this tremendously difficult problem has, I think, been both encouraging and impressive.

The Board has had to face in the last five years a reduction in manpower of 160,000 as well as large-scale movements of men; yet unemployment amongst miners has been substantially below the national average. Between 1959 and 1961 no fewer than 117 pits were totally closed. That represented to the management of the Board a real challenge, and I think that it deserves credit for the way in which it has met that challenge, for the fact that the average level of unemployment caused by these closures has, at the end of each year, been kept within very moderate limits.

Mr. E. Shinwell (Easington)

This is a very interesting and, indeed, a vital point. Will the hon. Gentleman be good enough to give us comparable figures, saying how many men were employed in the mining industry as a whole in, for instance, 1960, and how many are employed now?

Mr. Peyton

If the right hon. Gentleman will forgive me, I think that, in the interests of strict accuracy, I should prefer to ask my right hon. Friend, who will, I am sure, be very willing to do so, to answer that question in detail when he replies to the debate.

For the future, it will be necessary, I am sure, for more men to leave their present homes if they are to stay in the industry. The House will recall the statement made by the Scottish Division of the Coal Board about the future of coal mining in Scotland. The statement showed that there are some areas where the prospects of men being found work in mining within daily travelling distance from their homes are slight. Inevitably, some men will have to leave the mining industry. This, of course, confronts the Government with a task which must be faced, the task of helping them to find jobs in other industries, training them in new skills, and, in areas where opportunities are limited, encouraging the development of new industry.

It is the hope of the Board that many of the men in these areas wild be willing to transfer to other coalfields in other parts of the country which will need to recruit labour. I know that people are exceedingly reluctant to go to new homes and to work in unfamiliar places. It is very easy to talk about these things and to write about them while, at the same time, divorcing oneself from the reality which they have in the lives of the men involved. This I accept, but, while we do not deny or ignore the human problems, I believe, nevertheless, that it is essential to recognise that the economy of the country will stifle unless men are willing to move from industries or parts of industries which are declining to those where the prospects of expansion are good.

Mr. William Warbey (Ashfield)

The Parliamentary Secretary has accepted Government responsibility for a policy which involves miners in moving from their homes to new coalfields. He has spoken about men moving to new homes. Do the Government accept responsibility for ensuring that these men have new homes to go to when they arrive in other coalfields?

Mr. Peyton

If the hon. Gentleman had waited a moment, he would have heard me refer to that point. I recognise that it has great importance, and, let me add, it is a much easier question to pose than it is to solve.

The Board is doing all it can to ease the personal problems. As the House will know, transferred men are entitled to lodging allowances, to transfer grants, to removal expenses and to allowances towards extra rent. However, as the hon. Member for Ashfield (Mr. Warbey) has, quite rightly, said, there is the vital matter of the provision of houses. More houses are an urgent requirement in the new areas. The Board is itself expanding its own housing programme and will be spending several millions of pounds a year on housing during the next few years. Nearly 2,000 houses have either recently been completed or are now in course of construction or planned in the East Midlands Division alone.

If the Board is to be able to come anywhere near to solving the immense problem facing it in this respect, it must have the active help of local authorities. I take this opportunity of saying at once that many authorities are giving ready co-operation. For example, in Yorkshire——

The Minister of Power (Mr. Richard Wood)

Hear, hear.

Mr. Peyton

—my right hon. Friend, of course, is ready to applaud Yorkshire—the Doncaster Rural District Council expects to build 600 new houses by the end of 1963.

The Knottingley Urban District Council has agreed to provide 1,200. Negotiations are proceeding with various authorities for more than 2,000 houses in South Wales. I very much hope that other authorities, when similar proposals are before them, will judge them with the humanity and the urgency which are plainly demanded.

It is undeniable that the coal industry is going through an immensely difficult period of change. It is having to adapt itself to a smaller share of the fuel market and to the fact that the old certainty of selling all that could be produced has gone. Since 1956, the annual consumption of coal has fallen by about 26 million tons. Moreover, while that fall has been taking place, there has been a very marked and important change in the pattern of sales. The sale of the more valuable and expensive coals has been falling while sales of the cheaper coals have been increasing. This has only served to increase the problems of the Board.

Change is taking place also in the pits themselves. As I have already said, new pits are replacing old ones. Men are moving to other coalfields. The industry is in the throes of an intensified drive for more mechanisation. Further changes may arise from our entry, if it comes about, into the European Coal and Steel Community.

It was very much against this background of change that the Government decided—it is still their opinion—that it would be wrong to add to the already great difficulties facing the industry by licensing coal imports, at least for the time being.

The suggestion that there should be a reduction in the Board's capital liabilities has been much canvassed. It is important to remember in discussing this suggestion that there has been continuing and very heavy investment in the coal industry during recent years. This investment has produced, and is producing, assets of great value which will, I hope, prove lucrative. Capital reconstruction—I think that this point should regularly be made in the House—would not involve the extinction of a notional debt but the transfer of a very real and painful one to the taxpayer.

Nor do I think that such a palliative would in any way be an effective substitute for the vigorous efforts now being made by all concerned in the industry to make it pay its way. My right hon. Friend and the Coal Board have looked at this matter very carefully. For the moment at least, both are agreed that the kind of reconstruction asked for would, at present, be inappropriate and not helpful. Instead, I believe that the Board's present policies to which I have referred constitute a far more hopeful way of producing a better balance between capital and earnings. The success of those policies would make it possible for the Board, so long as markets can be held and stocks kept at a reasonable level, to do rather better than pay its way.

The House will recall that my right hon. Friend, in the statement to which I have already referred, stated the financial target which he had agreed with the Coal Board, that is, for the next five years to break even after setting aside £10 million annually towards the difference between depreciation on a historic cost basis and depreciation on a replacement cost basis. This is a modest target which my right hon. Friend believes makes full allowance for the difficulties to which I have referred.

Mr. Nabarro

Just now my hon. Friend used the words "so long as stocks can be kept at a reasonable level". I do not expect him to answer this "off the cuff", but I should like my right hon. Friend the Minister to answer it later. Undistributed stocks of coal have, according to the last available statistic of 3rd November, 1962, risen by 3 million tons compared with one year earlier. That is not a major rise, but we all considered last year that undistributed stocks were a bit too high. Would my right hon. Friend say, when he winds up the debate, what he considers to be a reasonable level of stocks?

Mr. Peyton

The question of what is a reasonable level of stocks always depends on what the market looks like. I referred to stock intentionally. This is one of the most difficult problems facing the Board.

Mr. Nabarro

That is why I asked about it.

Mr. Peyton

I make no bones about that. It seems that, whereas last year there was a fairly low lift from stocks, there is likely to be this year a net addition to stocks of 3 million or 4 million tons. That is inevitably a cloud on the horizon.

I think that it can fairly be said that the Board has shown both courage and imagination in facing what I do not think anyone would deny is a very difficult situation. I pay tribute to the leadership which Lord Robens has shown—I have myself seen a little of this—and by which he has injected new heart into the industry. I think that his understanding of industrial relations has undoubtedly contributed in a notable way to the recent and welcome success enjoyed by the industry. The results in the first half of this year and an 8 per cent. improvement in productivity during the past twelve months are certainly hopeful signs. I know that the House will be glad to hear that for the week ended 10th November the record output per man shift of 32.3 cwt. was achieved.

Mr. James Griffiths (Llanelly)

We on this side heard that, but I wonder whether the hon. Member for Kidderminster (Mr. Nabarro) heard it.

Mr. Peyton

I can assure the right hon. Gentleman that my hon. Friend, though perhaps he is stronger in a vocal way, nevertheless has a very good hearing capacity as well.

Mr. Nabarro

Is my hon. Friend referring to my vocal capacity?

Mr. Peyton

I never like to lose the opportunity of paying a well-deserved compliment to my hon. Friend.

It is true I think that the industry is in better shape and heart, but one must always recognise the fact that the future of the industry, and of all engaged in it, depends on its ability to hold its markets and to avoid the accumulation of excessive stocks. I should have said that in any case, and not merely because of the intervention of my hon. Friend the Member for Kidderminster.

I come to the Bill itself. As I have said, it is a Measure of modest dimensions and, I think, wholly innocuous in its purpose. This time last year we faced a very much less favourable prospect. In each of the preceding four years the Board's accumulated deficit had increased and it was clear that during the current year, 1961, it would again substantially increase. It was even possible that it might increase this year. But the problem boiled down to this, that the Board's internal resources of about £63 million plainly would be insufficient to finance a deficit which by the end of the year were likely to reach some £93 million.

The House therefore agreed to give my right hon. Friend the short-term powers contained in the 1961 Act. These made it possible for him to lend up to a total of £50 million to the Coal Board towards financing its accumulated deficit both at the end of 1961, and, if necessary, during 1962. In the situation prevailing at the end of last year my right hon. Friend exercised those powers to the extent of lending £30 million to the Board to enable it to bridge the gap between its total deficit and its internal resources.

I am very happy to say—and I am sure that I take my hon. Friend the Member for Kidderminster with me—that the remaining £20 million authorised under the Act are not required.

Mr. Nabarro

Hear, hear.

Mr. Peyton

The House will recall that the powers given to my right hon. Friend under the Act expire at the end of this year. I think that we can say that this year has seen a welcome change. It can now even be hoped that a modest profit—and I think that I should repeat those words—a modest profit will at least make it possible for the Board to repay some of its deficit borrowings under the 1961 Act.

The provisions of the Bill before the House are of a completely different character from those of the 1961 Act. As the House knows very well, Section 26 of the 1946 Act made the Minister the main source of the Board's borrowing. Under that Section the Board has gone to the Minister for its capital requirements. Section 27 was designed to give to the Board what any commercial organisation has—access to overdraft facilities. It enabled the Board to borrow temporarily from the banks, in the first instance, up to £10 million. This was later extended to £20 million by the 1951 Act.

Of course, the Board will need those overdraft facilities in future as in the past to meet any contingency, including possible temporary deficits. Hon. Members will note that I use the word "possible" and not "probable". Experience has, unhappily, shown that, for the Board as well as for other lesser people, overdrafts are not as easily obtained as they would undoubtedly be in a better world. Two years ago the banks were unable to provide the temporary accommodation that the Board needed, and this could happen again.

The Bill therefore amends Section 27 of the 1946 Act so that, in practice, the Board will be quite certain of being able to get its overdraft—a very happy position to be in. The Bill provides that, for the purpose of meeting a temporary deficit only, the Board may apply to the Minister as well as to the banks for a temporary loan. It also enables the Treasury to guarantee temporary borrowings from the banks. It will give the Board facilities similar to those provided for the transport boards in the Transport Act, 1962. The Treasury guarantee of bank borrowings is a support already available to all nationalised industries. Until now, for some unexplained reason, the Coal Board has been the "odd man out."

These simple amendments do nothing except ensure that the purpose which Parliament originally had in mind in writing Section 27 into the 1946 Act is discharged. The purposes for which the Board may borrow temporarily remain unchanged and the limit for such borrowings remains at £20 million. So that there is no confusion between this temporary borrowing and capital borrowing, I emphasise that the Board's capital borrowing powers under Section 26 of the 1946 Act remain at a limit of £700 million.

One other thing that the Bill does is to alter the dates of the Board's financial year to run from April to March instead of from January to December. This is a purely technical but helpful change which will give several advantages. First, it brings the Board's financial year into line with the Government's fiscal year. It brings the Board's financial year into line with the financial years of other nationalised power industries. It will also bring the Board's financial year into tine with the coal year, which is intended to end with the Winter, whenever that may be.

I hope that the House will agree that the change which I have described is a reasonable one and will be willing to accept the minor but useful legislative changes contained in the Bill. I very much hope that the House will be willing to give the Bill a Second Reading.

4.32 p.m.

Mr. Thomas Fraser (Hamilton)

I do not have much to say about the Bill. It is a simple one, as the Parliamentary Secretary has said, and I do not think that there will be much controversy between the two sides of the House over its provisions. I do not, however, find myself able to accept many of the things said by the Parliamentary Secretary in his review of the mining industry.

There was one thing that the hon. Gentleman said at the beginning of his speech with which I should like to associate myself. He mentioned the dreadful disaster at the Barony Colliery, in the constituency of my hon. Friend the Member for South Ayrshire (Mr. Emrys Hughes), where, a fortnight ago, there was a cave-in of the shaft of the colliery, which employs about 1,600 men. Unhappily, four men lost their lives in the tragedy, the nature of which is such that, I believe, the bodies have not yet been recovered.

All of us will have within our minds the conflict of sympathy for the bereaved, a realisation of what a dreadful job this is in any event and how much better it would be if men could find a more congenial way of earning a living, at the same time feeling great sympathy with 1,200 of the 1,600 men who are now out of work, with no prospect of getting employment in the mining industry within travelling distance of their homes, with no prospect, in spite of all that the Parliamentary Secretary has said, of getting employment in the mining industry in other parts of the country and with the Coal Board having the desire to reopen the pit as soon as possible but with the knowledge that that will take at least two years. Is it expected that at the end of that time, these 1,200 men will still be kicking their heels in idleness around the streets of Cumnock, New Cumnock and Auchinleck?

Whilst expressing his sympathy with the bereaved, the Parliamentary Secretary did not say a word about any determination on the part of the Government to ensure that other employment is provided in the area to which these men might turn.

Mr. Peyton

The hon. Gentleman ought not to misquote me. I said that the Government recognise that here is a very large employment problem, as does the Coal Board, although, unfortunately, until the position has been fully examined and the size of the problem is known, it is not possible to say what can be done about it. The hon. Gentleman should be fair about this. I endeavoured to make clear on behalf of the Government—I do not want there to be any denial of this—that the gravity of this dreadful occurrence and its results are fully appreciated.

Mr. Fraser

The hon. Gentleman said what he has just said he said, but I still say that he did not give any indication of the Government's willingness to take any measures to provide alternative employment in the area. I do not believe that they will do it. I do not have to use my imagination to discover what the Government will do in this respect. Unlike the hon. Member for Kidderminster (Mr. Nabarro), whom the Parliamentary Secretary seemed to identify as the House of Commons in the course of his Second Reading speech, I know a little about this industry. The only job I know apart from the job I do here is that of mining coal.

My constituency happens to be in Lanarkshire, an area which has suffered more from pit closures in the last twenty or thirty years than any other county in Britain. I know that in recent years the Coal Board, with the assent of the Minister, has found it necessary to close coalmine after coalmine, putting many thousands of miners out of work, but the Minister's colleagues in other Departments of the Government have taken no steps whatever to provide employment in those areas.

When the Parliamentary Secretary talks about houses being provided for transferred miners, I can tell him that five years ago, only a few miles from my home, houses were being built for transferred miners, to take miners from my constituency into the adjoining constituency of Lanark to work in the developing coal pit at Douglas. Then came the considerable cut-back by the decision of 1958 and after the houses had been built for transferred miners, we found that the only employment in the area was cut off and houses that had scarcely been occupied were emptied again and stood empty for a long time before we got other people to occupy them. The only people who could occupy them were those with employment 20 or 30 miles away and who had motor cars and could afford to live in this rather outlandish place.

The Government have done absolutely nothing to take alternative employment into the area. That is why the Parliamentary Secretary was able to say that for the men involved, the decision to close pits may sometimes seem harsh. It seems harsh to them when the only source of livelihood they have ever known is taken away and when the community that has been built up around the coalmines, when this great amount of social capital has been expended on building up the community, is simply left to become derelict because of the indifference of a Government who do not care.

Mr. Nabarro


Mr. Fraser

The hon. Member for Kidderminster is an expert on drivel. We have heard more of it from him than from any other hon. Member, in any part of the House.

The Parliamentary Secretary told us of the rundown in manpower of 165,000 in the past five years.

Mr. Peyton

I said 160,000.

Mr. Fraser

Then let us take the figure of 160,000——

Mr. Nakano

A very good thing it is.

Mr. Fraser

—as the rundown in the last five years. For the past twelve months the rundown is 21,000. For the most part, those men are from communities in which there is no alternative employment. The Parliamentary Secretary was not able to tell us what steps the Government had taken, and taken successfully. It is not so many words at the Dispatch Box that we want, but jobs. The hon. Gentleman was not able to tell us how many alternative jobs had been provided in those communities in which 160,000 miners have lost their jobs in the last five years.

Mr. Frank Tomney (Hammersmith, North)

The rundown is serious. Will the Government now state what figure they consider to be a stable one for the future economic running of the industry in view of the enormous rundown to which my hon Friend has referred? Is it 600,000 or 500,000, for example?

Mr. Nabarro

Five hundred thousand is right.

Mr. Fraser

The Minister may give his figure at the end of the debate. The number employed just now is slightly over 540,000.

Mr. Nabarro

The hon. Member is wrong. The correct figure last week was——

Mr. Deputy-Speaker (Sir William Anstruther-Gray)


Mr. Fraser

The hon. Member for Kidderminster is always trying to keep everyone right. The correct figure for the week ended 3rd November, 1962, which is the last figure made available to us by the Minister this week, was 540,600. I said that it was just over 540,00.

Mr. Nabarro

Will the hon. Member give way?

Mr. Fraser

No, I will not. This is much too serious a matter——

Mr. Nabarro

The hon. Member is quite wrong.

Mr. Fraser

The hon. Member for Kidderminster cannot even read the documents. The average for the first 44 weeks of the year was 553,210, but in the week ended 3rd November, 1962, the number on the colliery books was 540,600. The hon. Member probably will not understand that during the course of the 44 weeks manpower has been running down all the time. In fact, the number of men working in the industry came down by 1,000 from the last week in October to the first week in November, over the course of one week. [Interruption.] I wish that the hon. Member for Kidderminster would keep quite for a little while.

It is a serious matter for very large parts of the country to move hundreds of thousands of men and their families. The Parliamentary Secretary said that the Board deserved credit for the way in which it had handled this problem of the rundown of manpower. I agree with him. The Board deserves credit, but the Government take no credit at all from the way in which they have handled it. The hon. Gentleman went on to say that men must be prepared to move. Does he know that miners in the north-east of England, and in Scotland, when they are displaced, find that only a very small minority of them can be absorbed into the mining industry in those few divisions in which there is a shortage of manpower? The rest know full well that if they make a move they have to take a one-way ticket to the Midlands, or to London, because those are the areas where jobs are available, and where they will get alternative employment.

I wish that a Minister, some time, would make an appreciation of the social problems that have been built up for the whole nation by this attracting-off of the population all the while into this narrow corridor from the north-west Midlands down to the English Channel. Many parts of the country are shedding population; most of those mining areas are shedding it all the time. The displaced miner who cannot move into another job in a coal mine is invariably forced into the position of taking a one-way ticket into the most congested parts of the United Kingdom. I wish that the Government would look at this.

The Parliamentary Secretary went on to explain why the Government had decided not to license coal imports. He added, "at least for the time being". I did not like the warning note in those final words.

Mr. Nabarro

I did.

Mr. Fraser

Could we have quietness from the hon. Member for Kidderminster? A few months ago there were a great many irresponsible people, including not a few on the other side of the House, who were doing their utmost to prevail upon the Government to grant a licence to the Steel Company of Wales to import American coal.

May I quote some words from the managing director of the Steel Company of Wales, Mr. Carthwright—words repeated in the Colliery Guardian of 19th October? He is reported as saying: You may be surprised to hear me say this, but our supplies of coking coal from the most efficient pits shipped in large train-loads should find us in a competitive position compared with anywhere else in Europe. This idea is gaining ground with the National Coal Board and the British Transport Commission, and I can see that we are going to be fairly well placed."— "we" being the Steel Company of Wales.

So, in a few short months, the spokesman of this company had come to realise that there was really no need to import coal at all, so why the Parliamentary Secretary should have continued to hold out this sop to the most reactionary supporters that he has in this country that the time might come when imports would be permitted, I do not know.

Mr. Peyton

I should like to observe that the reason why I put those words in was because we admit, as we must admit, the possibility of policies having to change to meet events. The hon. Gentleman and his party will never do that.

Mr. Fraser

The Parliamentary Secretary explained why the Government decided not to license coal imports and then added, "at least for the time being."—but then the Tories are only governing for the time being. He did not have to add those words. Those words were the sop to the small group of hon. Members of whom he was one until he got his promotion to his present office a few months ago.

I have up to now devoted my speech solely to making some kind of reply to the speech of the Parliamentary Secretary. I now turn to some of the things, but not all of them, which I had initially intended to say in the course of the debate. The out-turn of the coal industry this year seems to me to have been a great credit to all those who are engaged in the industry. Only twelve months ago, the Minister believed that the deficit would be increased this year—I do not think that he will deny that. If anyone wants to deny it, I would refer him to the Financial Memorandum of the Bill, presented on 17th November, 1961, which stated: The possibility that this deficit may increase during 1962 cannot be ruled out So there was an expectation or possibility that the deficit would increase this year. The right hon. Gentleman himself left us in do doubt that he thought that the tide would turn, but that the time has not come. I wanted to put on record—it is no criticism of the right hon. Gentleman—that in the first six months of this year the Coal Board made a profit, after interest, of £9½ million, which seems to me a rather creditable performance, and the Parliamentary Secretary said that we hoped to finish the year with a small surplus.

Incidentally, I understand that the principal reason for changing the financial year of the Coal Board is to try to get the two half years in balance. Year after year, the first six months of the year have shown a good financial out-turn whereas the second half of the year has turned out not so well. People who wondered why the Board did so well in the first half of the year and not so well in the second half failed to take into account the fact that almost all the holidays were taken in the second half. Under the new arrangement, holidays will be spread more, and it is expected that the two halves of the year will be more equally balanced.

The hon. Gentleman mentioned the record figure of 32.3 cwt. per manshift in the last week for which figures are available. This is a tremendous achievement and reflects an increase so far this year of 2.3 cwt., or 8 per cent., on the same period last year. This far outstrips anything that "Neddy" has suggested that industry should achieve.

I note with interest that the Scottish increase has been 9.9 per cent. and is up now to 26.75 cwt. per manshift in the last week for which figures are available, which was at the beginning of this month. This was about the figure held out to the Scottish Division only a short time ago as the figure it should regard as its target in its very difficult geological conditions.

Whilst we have been getting this great increase in productivity, however, the market for coal has not been expanding. During the first 44 weeks of the year the total sales amounted to 162.2 million tons compared with 163.1 million tons in the first 44 weeks of 1961. Thus, we are nearly 1 million tons down in consumption. This was despite the fact that the industry got a good deal of assistance from the weather, for this year was much colder than last year and colder than the average, whereas last year was warmer than the average.

Thus, sales have declined when these natural phenomena should have led to an increase. This is bound to give cause for concern. Production in the first 44 weeks of this year was 166.4 million tons compared with 159.7 million tons in the same period last year. I have already quoted the manpower figures, but I remind the House that this increase in production has been achieved by more output per man shift with fewer miners following a considerable reduction in manpower.

In these circumstances, I suggest that satisfaction with the industry's achievements must not blind us to the social consequences of pit closures and fewer jobs in the mining areas. Great hardship is being suffered and there is very considerable unemployment in parts of Wales, over a wide area in the northeast of England and in Scotland. Alternative jobs are not being provided and there is very little hope in these communities that anything will be done for them in the short term.

There is also widespread criticism of the Government for their failure to make use of the nation's resources. This brings me to the need for overall planning of our resources. We have often said that the Government have a responsibility to promote alternative employment in these areas before the pits are closed. We have also stressed the need for a national fuel policy. The Minister has always shrugged that off. I would like now to illustrate what we mean.

I can tell him of some steps that he could take and would take if he were to adopt a national fuel policy and seek to mobilise and use the resources of the nation. The right hon. Gentleman is also the Minister responsible for the oil industry and for electricity. Fuel oil consumption has risen this year by 15 per cent.

Mr. Nabarro

Jolly good.

Mr. Fraser

Our refinery output of fuel oil was down in the first six months of this year by 200,000 tons and the net imports of fuel oil up by 600,000 tons. This is the equivalent of about 1 million tons of coal. The Government should not encourage this overdependence on imported fuel.

The Minister is also responsible for electricity. I understand that a decision has recently been taken to build a big new 4,000 megawatt generating station on the Medway Estuary. I realise that it is to be so constructed that it can be fuelled by coal or oil. But I have just enough intelligence to appreciate that the fact that it is being built near the big oil refineries is an indication that it is more likely to be oil fuelled than coal fuelled.

I suggest that instead of going ahead with this generating station the right hon. Gentleman should take the advice which the Press says he has been given by the Coal Board and build two 2,000 megawatt coal-powered stations, one in the North-East and the other in Scotland. Lord Robens has been reported as advocating this. At present, there is heavy unemployment in those areas. Many pits are threatened with closure in the next few years not because there is no longer any coal in them, but because the Coal Board finds it impossible to find a market for it.

If the Minister accepted this suggestion the consequence would be that he would be undertaking to use indigenous fuel from pits threatened with closure but with coal enough to last beyond the end of the century. Each project would give employment to about 10,000 miners and sustain a population of 50,000.

At this time, when we are so concerned with congestion problems in other parts of the country, when the right hon. Gentlemen's colleagues find it so difficult to steer alternative employment into these areas, and when the men are being left to stand about in idleness, would it not make good sense to agree to the construction of these two stations? They would do much to sustain the viability of those communities, and perhaps the Chancellor would not be so bothered by the balance of payments difficulties that arise from the imports of foreign fuel oil. I should have thought that from every point of view the case for the building of the stations was made out.

If the Central Electricity Generating Board, instead of taking electricity from those two stations, finds that marginally it would be cheaper to take it from the big station on the Medway, fuelled by oil, I suggest that the Minister and his colleagues have the responsibility of putting against this alleged marginal economic advantage the cost to public funds of keeping men and their families in idleness, the cost of providing alternative jobs, if alternative jobs are ever to be provided, and, if the miners who will be displaced move to London or the Midlands, the cost of providing homes for them there, together with all the other services which will be needed for a community of 100,000, the number of people who would be kept in those two areas if the Government went ahead with the two stations I have suggested.

I should have thought that on this test the national interests would have been best served by keeping the miners employed in the North-East and in Scotland. That is what we mean by having a national fuel policy. It is a policy which would be in the national interest.

In any case, when we compare the two competing industries of oil and coal, let us not forget that the oil industry has never been asked to carry the heavy financial burdens which have all along been borne by the mining industry. The Parliamentary Secretary and the Minister know—this has been said over and over again, but it does not become less true with the passage of time—that the coal industry was obliged to sell coal to its customers for ten years at £1 to £2 per ton less than the European price. Private enterprise would never have been asked or expected to do that.

If the mines had been privately owned during that period, the income from sales would have been not less than £2,000 million more than the Coal Board got. But the Board was not allowed to take advantage of the scarcity. In fact, throughout the time coal was so terribly scarce, the Board was required to sell it at less than the cost of production and so built up deficits which are now helping to put up the price of coal. The Board had to bear a loss of £70 million on imported coal. No private industry could have been asked to do that.

So we could go on and on. The industry carried the cost of stocking coal to ameliorate the social hardship caused by the Government's crazy policies in 1957. No private industry could have done what the Coal Board did then. As a result of what it was required to do, it had to ask for more money to build up stocks. This sort of thing has gone on year after year, the industry thus building up the tremendous capital obligation to the Minister which now stands at £958 million.

The Coal Board has made a very substantial operating profit in running the mines ever since vesting day, a profit which has been turned into a loss only because of the amount of interest which the Board has been obliged to pay back to the Minister over the years. I believe that the time has come when men of good will, independent people, looking at this matter would all come to the conclusion that in the interests of Great Britain this tremendous burden should be lifted from the shoulders of the Board and some hundreds of millions of pounds of the capital debt outstanding to the Minister should be wiped off. I hope that the Minister will indicate that he is willing to do this.

Mr. Nabarro

My right hon. Friend will get into trouble with me if he does so.

Mr. S. O. Davies (Merthyr Tydfil)

What would that matter?

Mr. Fraser

In view of the Government's new mood and their new appreciation of the value of planning, and their setting up of "Neddy", "Nicky" and the like, it should be possible to have some coherent planning for the whole country. We ought not to have to wait for "Neddy" to show us the way. It should be possible to work out a national fuel policy. I have given a few indications this afternoon how it could be done. All we ask is that the Minister should give a lead to his colleagues by saying that he, at least, is determined to mobilise all our resources in the interests of the whole nation.

5.7 p.m.

Mr. Gerald Nabarro (Kidderminster)

I find the Bill somewhat innocuous, and I have no objection to its financial provisions. Generally, I shall give it my blessing and support.

I propose to apply myself this afternoon to more important and wider considerations relating to the condition of our coal industry. Under the chairmanship of Lord Robens important improvements have been made. Lord Robens is, of course, a thorough-going Tory today. That is why hon. Members opposite do not like him very much any more, and why they frequently quarrel with him.

Lord Robens has embraced all the principles enshrined in Tory philosophy for the conduct of nationalised industries, particularly the National Coal Board. The first of those principles is that the industry shall be conducted as a commercial enterprise with a view to earning a profit and not as a social welfare service, as the hon. Member for Hamilton (Mr. T. Fraser) would have it conducted. It is not a social welfare service. It is a commercial enterprise. It was a social welfare service under the Labour Party, and that is why it lost so much money.

Mr. J. Griffiths

Will the hon. Gentleman direct himself to one problem which represents our complaint? As my hon. Friend the Member for Hamilton (Mr. T. Fraser) has said, for ten years the coal industry was not allowed to work on commercial principles by charging what it could get for its products. Had it been allowed to work on commercial principles then, it would today have had a reserve of several hundred thousand millions of pounds. Does the hon. Gentleman admit that or not?

Mr. Nabarro

No, I do not admit that at all. We have had this all over before. The right hon. Gentleman has listened to me making speeches on coal for twelve years, in two of those years from the Opposition benches, and what he always fails to realise is that one reason why the Labour Party got chucked out on its ear in 1951 was the appalling discontent in the country with the way nationalisation was working out——

Mr. Griffiths

The hon. Gentleman is dodging the question.

Mr. Nabarro

—the endless inflation, and the faulty statutes of the right hon. Member for Easington (Mr. Shinwell), which contributed so largely to those losses.

Today we have a chairman of the Coal Board converted to Tory philosophy and making the industry pay. Nobody welcomes more than I, the publication of the interim statement of the revenue results of the Board for the first half of this year, to 30th June, 1962, which shows that after—and I repeat "after"—accounting for full interest payments to my right hon. Friend, the industry showed a profit of £9.455 million compared with a loss of £17.571 in the second half of 1961.

It showed a profit, and here I pause to congratulate my hon. Friend the Member for Yeovil (Mr. Peyton), now Parliamentary Secretary to the Ministry of Power. It was so nice to hear from the Dispatch Box his maiden speech on coal, and even nicer to feel that a former colleague of mine is now sitting on the Treasury Bench. [HON. MEMBERS: "You will be there soon."] I shall not be there.

My hon. Friend is sitting on the Treasury Bench putting forward both my views and his views on this important and basic industry. There was something about my hon. Friend's choice of words today which I liked. His enunciation is good, but his choice of words is even better when discussing a nationalised industry. He did not talk about a "surplus" earned by the Coal Board, but used the good homely Tory phrase, "the profit of the Coal Board". I, for myself, love profits. I love profits. [HON. MEMBERS: "For yourself."] Yes. Profits are what make me tick and they make this nation tick. Somebody has to pay the losses of the State boards, but if we can make them pay there will be some residual benefit for the taxpayer in the elimination of trading losses. [Interruption.] The hon. Member for Normanton (Mr. A. Roberts) has got hot pants. Does he wish to interrupt?

Mr. Albert Roberts (Normanton)

I should like the hon. Member to say a little more about why Lord Robens has brought about this transformation.

Mr. Nabarro

It is because he is a good salesman. He has gone around the country making speeches in support of the coal industry. He is the first good salesman that the Coal Board has ever had as chairman. He understands the industry and he passionately has its interests at heart. I support the sales campaign which he is conducting. When the National Union of Mineworkers was criticising the appointment of Lord Robens as chairman of the Coal Board—I supported that appointment—it was the Daily Telegraph which said that the union would really have had something to grumble about if the chairman who had been appointed had been the hon. Member for Kidderminster.

Mr. A Roberts rose——

Mr. Nabarro

I have answered the hon. Member adequately.

Not only is Lord Roben's appointment a good one, but it is producing the right result, which is to operate the Coal Board on a profitable basis and not as a social welfare service, as some misguided Socialists would have us operate it. When I see Lord Robens producing a trading profit—and I repeat profit—for the first half of 1962, I say to myself, "Gerald my boy; there is hope for Dr. Beeching yet." Dr. Beeching is following the same principles. He is trying to make the railways pay on good commercial lines.

What the hon. Member for Hamilton heard me say a few minutes ago to my right hon. Friend the Minister of Power, when the hon. Member for Hamilton was speaking, was not a threat by any means. I said that my hon. Friend would have a lot of trouble on his hands from me if he sought to waive the burden of interest which rests on the shoulders of the National Coal Board. Does the hon. Member for Hamilton really believe that any industry should have its capital supplied to it without any interest charges? If he does, he is the sort of infant amateur who ought to be working down the pits again as a boy and not sitting in the House of Commons as a Member of Parliament.

Mr. T. Fraser

If the hon. Member for Kidderminster (Mr. Nabarro) had any capacity for hearing and understanding, he would know that what I was saying was that the coal-mining industry should not have been obliged by the Government to sell its products at less than the cost of production, so building up a tremendous deficit, and should not have been obliged to carry a loss of £70 million on coal which was imported not for the purposes of the coal-mining industry, but for industry generally.

Mr. Nabarro

That was not the burden of the hon. Member's argument. I am well aware of the propaganda of the National Union of Mineworkers and how it is intimately linked with the propaganda of the Labour Party. It does not make much impact in the coal consuming areas of Britain, although it makes some impact in the coal producing areas most largely furnishing Labour Mem- bers of Parliament. The plain fact of the matter is that these interest charges largely result from losses in the past as well as the take-over price of the industry.

Mr. Michael Foot (Ebbw Vale)

That is what my hon. Friend the Member for Hamilton (Mr. T. Fraser) was saying.

Mr. T. Fraser rose——

Mr. Nabarro

I gave way once to the hon. Member. I noticed that he was not very generous about giving way to me. However, I am a generous-hearted chap and I will give way to him again.

Mr. Fraser

Tomorrow we shall be debating the Second Reading of the Agriculture (Miscellaneous Provisions) Bill which will give an additional £35 million to the farmers without any question of interest rates. What is the view of the hon. Member about that?

Mr. Deputy-Speaker

Order. I hope that we will not be deflected from the Bill which we are now debating.

Mr. Nabarro

As you know, Mr. Deputy-Speaker, I am never deflected in these matters. I am grateful to you, as always, for your protection on this important occasion. There is no doubt that tomorrow we will hear the voice of the hon. Member for Hamilton on subsidies for agriculture—[HON. MEMBERS: "He is dodging the question."] I shall not talk about it. It is out of order. I never do things which are out of order, Mr. Deputy-Speaker.

I want to pass on to the capital investment moneys of the Board. My hon. Friend the Parliamentary Secretary said that there would be capital savings, but I do not see much evidence of that. The annual investments authorised for the Board were: in 1960–61, £94 million; in 1961–62, £93.3 milion; in 1962–63, £90 million; in 1963–64, £83 million. There is a slight downward curve, but my hon. Friend misses the important point, which is how much of the capital investment of the Coal Board is being provided from its own resources in those years.

The policy of Her Majesty's Government, as in the case of the electricity industry, must be to cause the maximum contribution to the capital investment programme of the Board year by year to be met by its own resources and the minimum to fall by way of borrowing, on Treasury loans, through my right hon. Friend.

Mr. Peyton

The last hope we all share. May I explain to my hon. Friend what I said and what I was referring to? I said that there had already been substantial reductions in the capital investment programme of the Board. If my hon. Friend will look at the Revised Plan for Coal, for instance, he will see that it shows that, following the contraction of the market, there had been a reduction of £175 million over the ten years' programme of capital investment until 1966. Since then, there have been further reductions. I think that what I said was entirely justified.

Mr. Nabarro

I do not think so. I do not like to be drawn into conflict with my hon. Friend. The Plan for Coal is now quite an old document. I quote from a much more recent document, Public Investment in Great Britain, October, 1962, only four weeks old. The four figures which I have just quoted—£94 million in 1960–61, £93.3 million in 1961–62, £90 million in 1962–63, and £83 million in 1963–64—are from a document which is only four weeks old, not last year's document. What matters to me, though, is whether the Government are applying with sufficient rigidity and sufficiently accurately their pronounced policy in the earlier months of this year to the effect that the maximum contribution in capital investments within nationalised industries should come from the internal resources of the industries themselves, and the least possible from external borrowing, namely, by Treasury grant through the Minister of Power. I hope that my right hon. Friend will answer this point when he replies because it has a direct bearing on this Bill, and while I continue talking perhaps the Parliamentary Secretary will scrutinise the source of my figures.

Now I want to say something about productivity in the coal industry. Last week we opened National Productivity Year in this country, and all over Britain important meetings are taking place in support of increasing productivity in every sphere of industrial, agricultural, and professional activity. My duty on the day that National Productivity Year was inaugurated was opening it in Coventry with Sir Vincent Tewson talking for the trades unions, and I was asked to talk for the employers. The hon. Member for Ebbw Vale (Mr. M. Foot) should not snort whenever he hears the word "employers". One cannot run anything without a boss, and everything has to be run in industry by bosses, and the voice of the bosses ought occasionally to be heard.

I thought that it was important to say what I considered was the correct definition of productivity, and I said that in my view productivity was higher output per man hour—o.m.h.—with fewer hands, and hence at lower cost. I might have added that the epitomy of increased productivity, the gold medallion, if the House wishes, for productivity in the last twelve months ought to be given to the National Coal Board because its performance in productivity has been magnificent. I think that, at the beginning of National Productivity Year its achievements ought to be quoted in support of every national productivity meeting.

I quarrel with the hon. Member for Hamilton about his interpretation of figures. I am sorry if I interrupted his speech. I did not mean to be rude in any way, but I prefer to take average figures for employment in the pits over a period of months, and not take them at a precise date, because illness and other seasonal factors often influence a published figure at a precise date. I quote from the Ministry of Power's Weekly Statistical Statement. The average weekly employment in the pits of Britain during the first 44 weeks of the year 1962 was 553,210 men. The average employment in the first 44 weeks of 1961 was 572,110 men. In other words, there was a decline in the average employed over comparable periods of 44 weeks of 19,000 men. Production—not productivity—for the first 44 weeks of 1961 was 159.7 million tons, and in the first 44 weeks of 1962 it was 166.431 million tons. So, with a lesser labour force—by 19,000 men—an increased tonnage of 7 million tons was produced.

Mr. Roy Mason (Barnsley)

That is an illustration of nationalisation.

Mr. Nabarro

No, it is not an illustration of nationalisation. It is an illustration of a good Tory appointment of Lord Robens as chairman of the Board. There has been a 3½ per cent. drop in manpower, and a 4¼ per cent. increase in tonnage mined, and I believe that these are indeed creditable achievements and should be widely advertised as the performance of the National Coal Board.

It was the hon. Member for Hammersmith, North (Mr. Tomney)——

Mr. Shinwell

Get on with this comic turn and say something serious.

Mr. Nabarro

The right hon. Member for Easington becomes more garrulous than ever. When he is 88, not 78, I suppose he will be talking non-stop. It was the hon. Member for Hammersmith, North who wanted to know what was the optimum figure for manpower in the mining industry, and he asked my right hon. Friend to reply to this when he wound up the debate. I want to intervene and give my optimum figures. I am aiming at a manpower force in the coal industry of 500,000 men, reduced from 700,000 men five or six years ago. I want to see an industry of 500,000 men turning out 200 million tons of coal a year because that, in my view, would be a just reward for the huge investment of capital monies which the nation has made in the modernisation of the coal industry in the last few years.

The hon. Member for Hamilton should not bemoan a drop in manpower in the industry. He ought to applaud it. He ought to recognise that if we can go on steadily reducing the manpower in this industry we shall cause less and less men to work underground, which was one of the earliest of Socialist philosophies. If we do that while maintaining output at the level which is required by the nation, namely, approximately 200 million tons of coal a year, then this nationalised undertaking will in my view be properly conducted.

I want to deal finally with two points made by the hon. Member for Hamilton. He spoke once again on a brief from the National Union of Mineworkers about the Government's over-dependence on imported fuel. It is true that we imported more crude oil last year than in earlier years, but surely the hon. Gentleman, and even the most bigoted of Socialist supporters opposite with their friends in the National Union of Mineworkers, must understand that unless we go on importing great quantities of crude oil we cannot—

Mr. T. Fraser

I did not talk about the import of crude oil, but about the import of fuel oil. The hon. Gentleman must listen to what is said.

Mr. Nabarro

Crude oil and fuel oil combined, if the hon. Gentleman wishes. I am not quarrelling about that point, but the words he used, and I do not incorrectly attribute them to him, were "over-dependence on imported fuel". Whether it is crude oil or fuel oil, it is still imported oil. The hon. Gentleman was making the balance of payments point that we ought to depend more on home-produced fuel. But that is an entirely false and irrelevant consideration, because he should set it against the value of exports of petroleum products from this country, none of which would be achieved without this large volume of imported petroleum products, notably crude oil.

For example, compare the performance of the coal industry's exports from Britain with the performance of the petroleum industry's exports. I took the trouble to look up the figures in the Trade and Navigation Returns. The hon. Gentleman can study them for himself. He might learn a little more about fuel economics if he did. He would find from the last Trade and Navigation Return published in September, 1962, that if the petroleum product exports from Britain in the first nine months of this year proceed at the same rate for the whole year—and there is no reason why they should not—the value of United Kingdom exports of petroleum products will be no less than £115 million this year.

What will be the value of coal exports If we are lucky—£30 million. This means that petroleum products are responsible for nearly four times as much in earnings Of foreign exchange as coal exports from Britain, notwithstanding that we have to import crude and fuel oil, and that if we did not we could not have any petrol to run our motor cars, or aviation fuel, or grease, kerosene or lubricants. With all that we are still able to achieve, with our petroleum products, exports four times as great as can be managed by the coal industry—and then the hon. Member far Hamilton makes the jibing point that we are becoming over-dependent on foreign fuel.

My second point about the hon. Member's speech is a Scottish one. He was telling us a hard-luck story about the Lanarkshire pits. Of course more pits have been shut down in Lanarkshire than anywhere else in Britain. It is a very good thing too, because many of them are obsolete. We do not want to keep obsolete pits open, as ancient monuments, whether they be in Ebbw Vale or in Lanarkshire.

When I was battling before the Mackenzie Committee in Edinburgh, on 27th November last, giving evidence most of the day against the building of new and larger hydro-electric power stations in the Highlands, on grounds of extravagant financial investment and battling for the building of thermal coal-fired power stations in Lanarkshire instead—in order to employ Lanarkshire coals of high ash content and low quality—and thus avoiding the closure of more pits, I received no support from the hon. Member for Hamilton.

In fact, looking down the list of individuals and organisations giving written or oral evidence before the Committee on the generation and distribution of electricity in Scotland, namely, the Mackenzie Committee, I find the name of only one Socialist Member of Parliament—and he did not take the trouble to turn up in person in Edinburgh to be grilled by the Committee; he sent a written statement of evidence. His name was George Thomson, the hon. Member for Dundee, East. Before you call me to order, Mr. Deputy-Speaker, may I say that I am merely quoting from the Report of the Committee?

Two Tory M.P.s gave evidence orally. They both took the trouble. My hon. Friend the Member for Inverness (Mr. N. McLean) gave oral evidence, and I gave my evidence at length, and orally. The burden of my evidence, which was too lengthy to be published in the Report—[Interruption.] I did not notice the hon. Member for Ebbw Vale at the Committee. He is not interested in the Lanarkshire miners.

Mr. Emrys Hughes (South Ayrshire)

He has enough trouble in Ebbw Vale.

Mr. Nabarro

Of course he has. But I leave that question aside, whether or not he takes the Labour Whip.

Of course, a problem arises with the shutting down of pits in Scotland, but the hon. Member should fall in behind me and stop the extravagance of the Hydroelectric Board. The future power requirements of Scotland in the essential industrial field should be based on Lanarkshire coal, instead of the hon. Member for Hamilton bringing to this House the hypocrisy and humbug of the hard-luck story he has told us this afternoon.

The hon. Member for Hamilton and his friends are jealous of the fine fashion in which my right hon. Friend, ably aided by Lord Robens, is conducting the affairs of the nationalised coal industry. We are giving the nation 200 million tons of coal a year, which is all that it requires at present. But the exports of the coal industry are not yet high enough, and must be increased in the next few years, whether or not we go into Europe. The overburdened consumers of this country urgently require a reduction in the price of coal. The cost of coal is being reduced, but the price to the consumer is not.

In the west of England—and I see my hon. Friend the Member for Exeter (Mr. Dudley Williams) nodding assent—and in the south of England the consumers greatly object to having to pay the present high price of coal. Next year and the year after we shall be getting coal prices down. For the time being, we have got over our first hurdle. We are beginning to make the industry pay. [HON. MEMBERS: "We?"] Yes, we—the Tory Party. At the last General Election we insisted that we would make the industry pay. There is hope for Dr. Beeching yet. We will make the railways pay before we are through. The basis of sound Tory philosophy—the right hon. Member for Easington has got hot pants now—is to conduct these nationalised industries as sound, commercial enterprises, and not as social welfare clubs, as the Socialists would have us conduct them.

5.35 p.m.

Mr. E. Shinwell (Easington)

I wonder what the thousands of miners in the North-East, Scotland and many other parts of the coal fields would say if they had listened to the speech just made by the hon. Member for Kidderminster (Mr. Nabarro).

Mr. Nabarro

They would applaud it, of course—and enjoy it.

Mr. Shinwell

Several years ago the late lamented Stanley Baldwin referred to the "hard-faced profiteers" on the Tory benches. It may be that in succeeding years the image has undergone a transformation. The pretence now is that they have consideration and solicitude for the workers of the country—those who are impoverished and those who find themselves without employment. I prefer the image of the hon. Member for Kidderminster.

Mr. Nabarro

Hear, hear.

Mr. Shinwell

He represents and reflects the true Tory mind.

Mr. Nabarro

Hear, hear.

Mr. Shinwell

Apart from the comic interludes which are characteristic of the hon. Member, and with which we are now only too familiar——

Mr. Nabarro

Hear, hear.

Mr. Shinwell

—the hon. Member rests his case upon the assumption that if, in Tory terms and capitalist nomenclature, an industry pays its way we can afford to disregard the social consequences.

Mr. Nabarro

I did not say anything of the sort.

Mr. Shinwell

That is a philosophy that hon. Members on these benches repudiate and decline to accept.

We naturally welcome the Bill, but we do so for reasons quite different from those advanced by the hon. Member for Kidderminster. I can express my view almost in a sentence on this question. Without investment in the public sector—and that is what the Minister is advancing in the Bill—our economic situation would be more parlous than it is at present. That has been admitted in high financial quarters. That is the sole reason why the right hon. Gentleman embodies in this Measure a provision Which makes it possible for one section of the public sector to provide additional employment either directly or indirectly—directly by the employment of mine workers and indirectly by the purchase of essential material, without which the minting industry could not continue to produce.

We are under no illusion. This is not generosity; this is not a gift from the Government. The Government know only too well that without financial provisions of this character for the nationalised mining industry, and for the Transport Commission on an even grander scale—if that term is relevant they would find themselves in a more serious situation. This is not a gift. Nevertheless, we accept it, because it is essential that the indigenous material at our hands should be exploited and that the mining industry should be developed, because the country cannot afford to ignore an indigenous industry of such value.

I regard this as a very serious debate indeed, and I am very pleased that we are permitted within the procedure of the House to discuss the wider aspects of the industry. I want to present the real nature of the problem. To begin with, it is a matter—and this is highly relevant—of how much coal can be produced, but, more particularly, how much coal can be sold in this country and overseas. That is the first problem that confronts us.

The second is to what extent is indigenous fuel at the mercy of imported fuel—a matter to which my hon. Friend the Member for Hamilton (Mr. T. Fraser) rightly referred. The third factor, to which we have ventured to draw attention on previous occasions and to which I attach considerable importance, is the matter of productivity in the industry—the increase in production per man-shift, and I shall deal with that factor, to begin with.

Reference has been made to the achievements of Lord Robens. I doubt whether the chairman of the National Coal Board will welcome the unsolicited testimonial from the hon. Member for Kidderminster. It will certainly not enhance his popularity among the unemployed miners, but I would not detract from the value of the achievements of Lord Robens, except that I should like to know what were his instructions.

I wonder if the Minister of Power would tell us what instructions were given to Lord Robens on his appointment. Was it an instruction to promote the highest efficiency whatever the cost? Were the instructions issued to Lord Robens that the industry should be contracted, even if it meant disregarding the social consequences? Or was Lord Robens merely asked to be objective? Within that term, almost anything could happen, as indeed, almost anything has happened.

The fact of the matter is that, with rationalisation in the industry, increased mechanisation, modernisation, reorganisation, whatever we care to call it, the inevitable consequence must be the employment of fewer men. We have to face it. The hon. Member for Kidderminster talked about 200 million tons of coal being produced by 500,000 men.

Mr. Nabarro

Jolly good.

Mr. Shinwell

I do not take the slightest notice of the hon. Member's predictions— —and still the wonder grew, That one small head could carry, all he knew.

Mr. Nabarro

It is the largest head in the House.

Mr. Shinwell

I told the hon. Gentleman once before that he was a blatherskite. Now he is a conceited blatherskite.

Nobody is in a position to predict accurately what is to happen in the mining industry, except one thing. Fewer men are to be employed——

Mr. Nabarro

Hear, hear.

Mr. Shinwell

—with all the dire, grave, deplorable social consequences that are bound to ensue. After all, that is the subject to which we have to address ourselves. If we are told, as, indeed, I thought the Parliamentary Secretary ventured to say, that the level of employment in the mining industry remains the same—if that is what he believes—all I can say is that all the statistics contradict him.

Let us take, for example, the constituency, with large mines, some of them flourishing and some of them not so good, which I have the honour to represent in Durham County. The number of men has been reduced in the course of ten years from well over 100,000 to about 70,000, and Mr. Sam Watson, the secretary of the Durham miners, has predicted that in the course of a few years, the number will be about 50,000. It does not follow from that that there will he a loss of production. Nor does it follow that we should require to close down pits, because we can have a number of pits operating with fewer men and succeed in increasing production. All that is possible, but we cannot ignore the inevitability, because of reorganisation, modernisation and the rest, of a gradual decline in the number of persons employed in the industry.

It is not an evil thing that men should be required to go down into the bowels of the earth to earn a living, despite the accidents, calamities and disasters with which we are familiar. If alternative employment can be found on the surface, by all means let us try to secure it. Let us face the facts. The coal is there—indigenous material of great value—and somebody has to go down into the bowels of the earth to produce it, unless we can discover some mechanical device which enables us to bring the coal to the surface without the employment of manual labour, and so far we have not succeeded.

So, I repeat, let us face the consequences of the first notable factor which confronts the industry—the inevitability of fewer men being employed. I should not have ventured to take part in this, or indeed in any other debate, unless I could find myself in a position of offering some constructive proposal, and I now venture to put before the House, although there may be considerable and indeed violent disagreement with me, even in my own circle, this proposal.

I took part many years ago, as Secretary for Mines, in a conference at the International Labour Office on the subject of the reduction of the hours of mining labour. On behalf of the Labour Government, I was instructed to try to promote a seven-hour day in the mining industry. Eventually, with the aid of the late M. Albert Thomas, the late A. J. Cook and many others, I succeeded in obtaining an agreement for a seven and a quarter hour day. Unfortunately, the Convention was never ratified. I now say that this question must be faced by the Government, the mining industry and the National Coal Board. If it is practicable there should be a reduction in the hours of labour and, I say quite frankly, for the purpose of employing more men at the coal face and on the surface, for those who get the coal from the bowels of the earth and those who handle it on the surface.

I do not suggest for a moment—it would be foolish to do so—that this is a complete solution. A reduction in working hours is something which will have to be accepted, not only in the mining industry but on the railways and in a great number of industrial organisations in this country sooner or later.

Now I come to the other matter to which I referred, namely, this challenge to the mining industry from imported fuel. The Government's policy is obvious. First, they do not like the nationalised mining industry, let us make no bones about that. They have to accept it now because they would never dream of handing this nationalised industry back to private owners. They would not try that on. It would not succeed. But, all along, the Government's policy has been to present a challenge to the coal industry by relying to a very large extent—to a much too great extent in my opinion—on imported fuel oil, and crude oil also, as was rightly said by my hon. Friend the Member for Hamilton. It may be advantageous from the standpoint of the Government, to present a challenge to the coal industry to promote greater efficiency and more modernisation, to reduce the number of men employed in the industry, and to provide a profit by providing the necessary competition to an indigenous industry. That has been the policy of the Government.

I come to the third point, namely, the question of coal sales. There has been a lot of talk about coal sales even by Lord Robens who, I think, has been talking through his hat about the possibility of selling a great deal of coal abroad. In Europe they are confronted with precisely the same evil factors which confront the British mining industry. Anyone who knows anything about the European coal position will know that in the next ten or twenty years we shall not sell anything like the volume of coal overseas that we sold in the past—nothing like it. Indeed it is likely that exports will fall as time goes on, because in Europe they are confronted by the same challenge from fuel oil as confronts the coal industry in this country. And, it may be, with the threat of atomic power—who can tell? Certainly the coal industry is much more likely to decline.

Now I come to a matter which seems to concern the hon. Member for Kidderminster who, as usual, having made his speech, has left the Chamber. The hon. Gentleman loves to talk, but he hates to listen. What is the hon. Member for Kidderminster worried about? The industry has to pay. The industry has got to produce a profit—never mind about the consequences of producing that profit. How the hon. Gentleman glories in the fact that the mining industry, under Lord Robens, has produced a profit, a surplus of £9 million. Does it matter what has happened? Does it matter that thousands of men have been thrown out of work and many pits have been closed? It does not seem to matter to the hon. Member for Kidderminster or to the Minister of Power. I tell that to the right hon. Gentleman frankly. It is better to be straight and honest and forthright about it. It does not seem to matter to the Minister. But in the County of Durham we are told that next year another 5,000 men will lose their jobs—maybe more. The same thing will apply elsewhere and the numbers employed in the industry will be steadily reduced. And this all for the purpose of making the pits pay.

I had the privilege, indeed the honour, of piloting through this House the legislation which nationalised the coal industry. It was by no means the easy task that some people imagine, far from it. Nor were the consequences as pleasant as one might have anticipated. I admit that freely and frankly. Although we were optimistic at that time we had, apparently, forgotten the long period of years during which the privately-owned mining industry had been neglected. Not only was the industry neglected, but it had no proper machinery, nor the requisite organisation. By the way—this may be regarded as a regression—some critics of the nationalised mining industry talk about the industry not producing a large enough surplus, as if the privately-owned industry of bygone days—the industry as it existed when I first came into political life, before the First World War, during and after it and in the 1920s and 1930s—was making a great profit.

Then most of the pits were in debt to the banks. Practically no dividends were paid. I see sitting opposite the hon. and gallant Member for South Fylde (Colonel Lancaster) who has great knowledge of the mining industry. The hon. and gallant Gentleman was dispossessed when we took over the industry, although I am bound to say he did not do badly out of it. Perhaps that is one of the troubles. But the hon. and gallant Gentleman knows only too well that many times the private concerns suffered from severe losses and were in financial difficulties. The assumption that the privately-owned mining industry flourished and made vast profits is not true.

When we nationalised the industry we had no thought of singling out particular areas which were making either a profit or a loss or of closing down pits. If I may use the expression, we thought in global terms. We thought that although one part of the industry might not pay, other parts would. That is precisely the way that many large stores are run, if I may use a simple illustration. It may be that in a store the ribbon counter pays handsomely, although the lingerie counter does not pay as well. But no one would think of closing down the lingerie counter. It is an essential feature of the store—I will not say why, I will leave that to the judgment of others.

That was our conception of how to run the nationalised mining industry. But that is not the conception of this Government. Nor, apparently, I regret to say, is it the conception of Lord Robens. The idea is that if a pit is not economic—by the way what does that mean? Is there a thorough investigation into whether a pit is economic? What does that mean? Does it mean that there is no coal in the pit? Does it mean that there are physical difficulties in production? Or does it mean that the pit cannot produce a profit? A pit may be thoroughly economic in the sense that it contains material, and there are no excessive faults in the strata, but it may not produce a profit, although it could go on producing coal and providing employment for men, and not produce derelict areas which are being created at the present time.

I say to the Government that this Bill is a temporary Measure to help one section of the public sector. It is all very well far the right hon. Gentleman and his precious Government—I am almost inclined to say "wretched Government" in this context. Let me tell him frankly that we hon. Members on this side of the House who represent mining constituencies, and know how so many of our constituents are suffering, are getting a little tired of the Government's policy, or lack of policy. If the Government think that they are going to get away with this sort of thing, they are making a vast mistake. They are wrong if they think that the discontent among the miners, and the protests, which are now perhaps no more than a murmur will not become more massive in proportion and express themselves more strongly. I issue this challenge to the Government as did my hon. Friend, and rightly so.

If unemployment is resulting from Government policy—and it is—they should produce their alternative. Either there should be a reduction in the hours of labour or they should provide the men, I shall not say with the full amount of wages which they were receiving when they were working in the industry, but with something not far removed from that. They should not rely on unemployment benefit, but receive some supplementary benefit to recompense them for the effects of Government policy, or they should have alternative work provided for them.

To say that men can migrate to other parts of the coal field on the assumption that they can be readily and easily absorbed, is completely to misunderstand the position. I have no doubt that some men would be absorbed. I wonder if we could be told the numbers of men who have returned to Durham having gone to the Midlands and Nottingham. The same applies to men in Scotland. They have returned, not only because of housing accommodation, but because they prefer to remain in their own districts. There should be mobility, yes, of a kind, but not enforced mobility, not migration which comes about as a result of pressure exercised through Government policy. If men want to travel from one part of the country to another to try to find employment elsewhere that is all to their credit and it displays an adventurous spirit, but that men should be forced to leave their families simply because of the closing of pits, is not good enough.

I challenge the Government either to persuade the National Coal Board to cry a halt to this policy of closing pits, or to provide alternative employment. If the Government cannot do either, it is time they got out.

6.3 p.m.

Mr. Anthony Kershaw (Stroud)

I do not often intervene in debates about mining, because my constituency lies far away from coalfields. My experience of coalmines is confined to knocking my head on the roof of one, from which I still bear the scar. I can understand the violence of feeling, without sharing it personally, about the displacement of miners, to which I shall refer in the course of my speech when I follow what was said by the right hon. Member for Easington (Mr. Shinwell).

I wish to refer to only one point, which is about exports from this country. We understand that Lord Robens expects that there might be considerable opportunities for the coal industry to export to Europe in due course. Of course, we all share that hope, but in this situation there are many factors which are rather hard to foresee. Coal is not a commodity in a free market anywhere in Europe. No European country leaves coal to manage by itself. That is for obvious social reasons which have been touched on this afternoon. There is no possibility that in the immediate future that position will change. First, we have competition from oil. During the last ten years the share of oil in European energy requirements has risen from 13 per cent. to 30 per cent. During that period the share of coal has fallen from 75 per cent. to 50 per cent., and is still falling.

There are one or two sinister clouds on the horizon so far as it concerns coal. At present, coal is exclusively used for coking, but I understand that experiments in the United States with other forms of firing for this process might mean, if they are technically improved, that even in coking there may be com- petition from other forms of fuel. Then there is the nuclear programme, far advanced in this country and begun in all European countries. It is expected that at least by 1970 it will be producing power normally at the thermal power stations to which at the moment 25 per cent, of the coal output goes and that it will be competitive by 1970.

If so, we must expect further competition from those two sources against the outlet for coal at the moment. Certainly, the price of oil is unlikely to change. We also have the rigidity of the coal industry due to amortisation difficulties and high labour costs, which makes it difficult to take advantage of changes of policy and price. It coal were in a free market the countries of the Six estimate that only 90 million of the 250 million tons of European coal would be competitive. That proportion is rather higher in the United Kingdom, I am told. I should be interested to know what proportion it is estimated in this country is competitive with other forms of fuel.

Even if competition from oil and nuclear fuel can be ignored, we have the competition from imported coal, especially United States coal which at present freight rates is between 50 per cent. and 25 per cent, cheaper c.i.f. European ports than coal produced at pithead in Europe. This is for obviously geological reasons, about which hon. Members know. It is very unlikely that American coal will become less competitive in price. The output per man per day in the United States, owing to its geological conditions, is no less than 22 tons in opencast mining and 10 tons from underground, as compared with the average European output of 2 tons per day.

This leads me to say that no other conclusion is possible than that an orderly reduction in the coal industry of Europe, including that of the United Kingdom, will be necessary. In those circumstances, can we envisage that Europe will be in a position to accept large imports of coal, either from us or from anyone else, even if we are inside the Common Market?

Mr. William Blyton (Houghton-le-Spring)

Does the hon. Member appreciate that under the document on synthesis which is the European Common Market energy plan to the end of the transitional stage, coal production will be halved by 1970?

Mr. Kershaw

I should not say it is to be halved; I do not think any exact target has been set. It is certainly envisaged that there will be a reduction in the coal industry, and that it will be confined by the date the hon. Member has mentioned to those pits which can he truly competitive with other forms of fuel. Certainly, if we are outside the Common Market we can definitely write off any possibility of our being able to compete in the European market with any of our coal exports.

The method used both by Europe and by us to support coal in the meantime is of importance to our exports and for our domestic reasons. For the moment, I wish to discuss what the methods should be. The Report of the Robinson Committee on European Energy, to which all countries lent their weight and agreed with as a technical document, laid down that an abundant supply of cheap energy was desirable on any economic ground. No one could possibly quarrel with that, but, apart from the time factor, it is essential to begin retraining and rehabilitation of those in the industry.

In passing, I suggest that it would be economical and, in the long run, from a human point of view, much better that displaced miners should not be kept in employment in uneconomical pits but retrained and rehabilitated in industries outside their industry. The financial method of sustaining the coal industry can be either by a tax on other fuels, which generally we have at present, or by a subsidy for coal. The subsidy could be applied to the consumer or to the coal industry as a whole, or even to individual pits for the time being. I suppose that it could be a combination of both of these.

A tax on other fuels raises the price of energy generally and it benefits the whole of the coal industry, whether it needs help or not. It provides no incentive for the ordinary reorganisation of the coal industry. Its advantage is that it is extremely simple, whereas subsidies, though efficient, selective and cheaper, are complicated to administer.

The policy of the Six in Europe at present, which is relevant to our exports, is to give a subsidy and not to tax other fuels. In their project, which has not yet been adopted, but has been discussed several times and looks like being adopted before long, they envisage that by 1970 there shall be free entry for coal into the Common Market except from the Soviet bloc. By 1970, therefore, British coal must be competitive with other coals in the world. I ask my first question: will it be? By 1970, the Common Market proposes, there will be a nil duty on crude oil and very low duties on oil products, with a low, uniform Purchase Tax of about 2 dollars a ton. I ask my second question: can British coal meet that competition?

In general, therefore, the European fuel policy, if it is adopted, as it is likely to be, is a policy, as far as fiscal means can achieve it, to make energy as cheap as possible. Will the British coal industry be able to meet that challenge in 1970? From what I have heard this afternoon and elsewhere, I do not believe that a denial that these difficulties exist will provide an adequate answer. If, by 1970, we cannot meet competition from United States' coal and from world oil, I do not believe that Lord Robens' talk about exports will be of any use or that our exports are likely to be acceptable to anybody, because they will be too high in price.

In so far as the measures before us tend to get the industry into training for that in 1970—it cannot be done in a hurry—I believe that they will be to the advantage of those working in the industry and of the country.

6.13 p.m.

Mr. Iorwerth Thomas (Rhondda, West)

I do not intend to tread the same ground as has been trodden in the speeches delivered during the last two hours. But I shall devote a little of my time to dealing with certain of the myths and images which are being projected on to the public mind as a result of speeches made in the House from time to time by Government supporters and, particularly, by the hon. Member for Kidderminster (Mr. Nabarro).

We all listened, not with surprise, to his declaration, which was a source of great pride for him, that he judged the success or efficiency of any industry by its profitability, and that he took great pride in being a disciple of Tory philosophy and economics applied to society in general and to the coal mining industry in particular. He said that the present improved prospects of the coal industry, measured by its profit of £9 million, are due to the application by Lord Robens of Tory philosophy. This is characteristic of the declarations made by the hon. Member from time to time. He makes them with a great deal of flippancy, and he made his declaration today in his usual flamboyant style.

But anybody who is acquainted with the history of this industry knows full well that it is a long-term policy of capital investment, conducted by the Coal Board over the past ten years, which is responsible for the turn of the fortunes of this industry, and that it is not due to the influence or the power or the vision or the salesmanship or the Tory philosophy of Lord Robens. We are beginning to see the results of social planning in this great industry.

As my right hon. Friend the Member for Easington (Mr. Shinwell) mentioned, this prosperity and this growth in the efficiency of the industry has been obtained only at a very high price—the price of social misery which has been paid by hundreds of thousands of miners and their families because of the inevitable reorganisation of the mining industry. I therefore do not think that the hon. Member for Kidderminster is entitled to claim that the turn in the fortunes of this great industry is in any way due to the application of Tory philosophy. It is the result of long-term social planning.

It has always been fashionable during coal debates for Tory speakers to give the impression to the consumers that the Coal Board and the miners are holding the community to ransom. I think that this impression, which has been deeply embedded in the minds of consumers, should be eradicated by a statement of the facts. One can quite understand the ordinary consumer, including the ordinary landlady, who has to pay £9 5s. a ton for coal, believing that all this money flows into the coffers of the Coal Board and that a substantial amount of it finds its way into the pockets of the miners.

What are the facts? Out of the £9 5s., the Coal Board receives only £4 10s. 10d. That is the average price of a ton of coal being sold. There is a balance of £4 14s. 2d., which goes elsewhere. Hon. Members opposite should explain to their constituents and to the landladies of Bloomsbury that not all the money which they pay for their ton of coal goes to the Coal Board, which receives only £4 14s. 2d. out of the £9 5s.

This shows that the cost of the distribution of a ton of coal is greater than the cost of its production; that the cost of coal is not solely or mainly determined by the cost of production but is greatly influenced by the cost of distribution; and that the miners and the Coal Board, therefore, should not be the victims of this criticism by the consumer.

A more important fact should be brought to the attention of the public. Miners, owing to the activities of the Press in past years, have never been popular with the public. If members of the public understood the life of the miners better, they would not be so eager in their condemnation. There is a general impression that the £9 5s. paid by the consumer for a ton of coal goes into the pockets of the grasping miners. There is the image of the miner who is holding society to ransom. It is believed that miners have converted the industry into a kind of much cow. Miners' wages account for only £2 9s. 2d. of the £9 5s. paid for a ton of coal. Of the £9 5s. paid by the consumer there is £6 15s. 10d. that the miners do not see.

The hon. Member for Kidderminster said that the industry should be judged upon its profitability and that the application of the Tory philosophy would have produced better results long ago. If, during the first ten years after the war, the industry had been in the hands of private enterprise, the country would have experienced a coal famine, because it is Tory philosophy to sell coal at the highest price obtainable. We all know that, as a consequence of the war, Europe was famished and demanded all commodities, especially coal and other forms of fuel.

Private enterprise, in the application of its philosophy, would have exported coal to Europe by the million tons because it could have obtained a higher price there and have had a higher percentage of profit. It would have disregarded the welfare of the nation. Industry would have collapsed. We should have been faced with mass unemployment. That would have been the result of the application of Tory philosophy in mining. It was the Labour Government and their planning and policy of nationalisation which averted that catastrophe for the nation. They acted for the good of the country.

As my hon. Friend the Member for Hamilton (Mr. T. Fraser) said, if the Board had been allowed to enjoy the freedom of Tory philosophy and allowed to make a profit disregarding completely the interests of the nation, it would have accumulated about £2,000 million, because it could have raised the price of coal by anything from £1 to £2 a ton. That is why we are faced today, as we have been before, with the question of the Board's borrowing powers. Why has the Board been forced from time to time to obtain the consent of the House for the advance of capital so that it can expand and operate its business? It is because the Board did not have the right in those days to raise the price of coal.

If the Board had had that fragment of Tory liberty and freedom in the first ten years after the war, what could it have done? If it had been able to put only 1d. per cwt. on the total production of 200 million tons a year for the first ten years, it would have increased its revenue by about £166 million. If the Board had been allowed to increase its price by about 3d. per cwt., which would not have been a great increase during those years when the demand was so great and the world provided us with a scarcity market, it would have had an increased revenue of over £500 million.

The strange thing is that in the first ten years after the war the Board borrowed £500 million. If it had been allowed to put 3d. on each cwt., it would have had no need to borrow £500 million from the Government. It would have saved the payment of £165 million in interest charges on the loan, which, in turn, would have wiped out all the remaining balances above the £500 million up to the £610 million. There would have been no need for the Board to come to the House to borrow money from time to time.

Mr. Donald Box (Cardiff, North)

Would the hon. Gentleman mind explaining one point to me? I have heard mention during the debate of the Board not being able to charge an economic price after the first ten years after the war. The Coal Industry Nationalisation Act is a piece of Socialist legislation. Can the hon. Gentleman explain why a regulation was included which prevented the Board charging an economic price?

Mr. Thomas

Yes. The coal industry was nationalised for the purpose of satisfying a social need. The Board was inhibited from making a profit. It was expected to break even, not to make a profit by means of putting accumulated reserves into cold storage. That was the difference between Tory and Socialist philosophy. If the Tory philosophy had applied, the mining industry could have gone on accumulating millions, if not thousands of millions, of pounds, and putting them in reserve, but at the expense of social calamity and disaster.

It is evident, from the discussions now going on in Europe about the future organisation, control and operation—not only of steel and iron, but of coal as well—that the Government intend to enter the Common Market. This is the time, therefore—while they have the opportunity and before they lead us into the Common Market—for them to do something for the British coal industry, for I have no doubt that the giants in Europe are already stripping themselves to the waist in readiness for the competition that is to come. It is obvious that the Government should now do something for the British coal industry to enable it to meet this challenge.

This is the moment when they should seriously consider the question of reconstructing the capital of this industry so that, if or when we enter the Common Market, it will be unfettered and unhampered by the large interest charges it now bears. If the British coal industry must face the challenge of the Common Market, I beg the Government to consider this capital issue so that the industry can compete under the most favourable conditions.

Since the Government appear to have suspended their decision on the capital reconstruction of the coal industry, and I understand that the matter is still in the air, I hope that they will remember the efforts made in the past by the industry and the burdens which have had to be carried by the miners in the post-war years and expedite their decision on capital reconstruction so that the industry will have a fair chance in the markets of Europe.

Only if the Government take this action now will the industry be guaranteed its survival in the face of any machinations on the Continent, particularly regarding the substitution of coal by oils and natural gases from Holland and the Sahara.

6.33 p.m.

Mr. Donald Box (Cardiff, North)

I cannot claim the knowledge and experience of mining which the hon. Member for Rhondda, West (Mr. Iorwerth Thomas) has, but I must take him to task on one point. I interrupted him during his speech and he told me that the reason why the National Coal Board had not charged an economic price in the years immediately after the war was a self-imposed restriction. I would suggest, with respect, that one cannot have it both ways and that if it was a self-imposed restriction it is no good recriminating about it now and implying that the Tories, in some way or other, were to blame for it.

Mr. J. Griffiths

We should get the position clear. During those years the price charged by the Coal Board was not completely based on its own freedom to do so, or its own jurisdiction, but was, in fact, determined by the Minister of the day. Thus, the Minister was really responsible for the price levels.

Mr. Box

And I take it that the Minister at that time was a Socialist right hon. Gentleman?

Mr. Blyton

That is not the point.

Mr. Box

When nationalisation took place there must have been a Socialist Minister in charge.

Mr. Blyton

If the hon. Member will read the Report of the Select Committee on the coal industry he will find references to the fact that on a number of occasions the Government refused to give permission for the industry to charge higher prices. That resulted in losses.

Mr. Box

Nevertheless, I take it that the Minister in 1947, at the time of nationalisation, was a Socialist right hon. Gentleman.

I came to the debate this afternoon in quite an optimistic frame of mind regarding the Coal Board, but I must say that the remarks I have heard from the right hon. Member for Easington (Mr. Shin-well) and the hon. Member for Hamilton (Mr. T. Fraser) have done a lot to depress me about the future of the coal industry. I hope that in South Wales we have a better story to tell. Although I am a Welsh hon. Member, representing a Welsh constituency, I have a certain amount of Scottish blood in my veins. I am ashamed to admit that I have never visited Scotland, although I must equally admit that the stories I have heard from hon. Members who represent Scottish constituencies do net lead me to be overanxious to make amends about visiting Scotland.

As we have already heard, the Bill has two objects. One of them is innocuous and concerns a change at the end of the financial year. While it may seem innocuous to us, a good deal of reorganisation will be needed within the Board, so that the whole thing probably looks a lot easier than it is. The second object concerns short-term finance. I hope that as a result of the improving results we have heard about today the need for this short-term finance will be rather less in the future than it has been in the past. In any event, I would suggest that the Coal Board, in its present profit-making mood, is a far better risk for bank borrowing than perhaps it has been in the past.

I was interested in the remarks of the Parliamentary Secretary about the increased investment in mechanisation, how the new capacity is likely to become available in the next few years and the need to remain competitive. During the Summer Recess I had a unique opportunity to pay my first visit to a coal mine. During the 3½ hours I spent underground I examined the various types of coal faces and saw something of the roof formations, particularly where roofs were inclined to cave in. I also crawled 50 yards up a 2 ft. 6 ins. coal seam, which was quite an experience in itself. I commend the opportunity, if it comes to hon. Members on either side of the Hause, to visit a coal mine—[Laughter.] Despite the laughter of some hon. Members opposite I can assure them that there are quite a number of Welsh hon. Members in their ranks who have not yet visited a coal mine.

During my visit I saw what is probably one of the finest examples of automation in industry today; a £1 million washery which deals with hundreds of thousands of tons of anthracite. It not only washes and cleans the commodity, but separates it into various grades and sizes and, finally, sends it down a chute to waiting wagons for transportation to the merchants and customers. The whole operation is conducted by a mere handful of men.

While I recognise that these experiences are hardly sufficient to qualify me for membership of the National Union of Mineworkers, they gave me the rare opportunity of meeting a number of miners actually working on the job and I was able to see at first hand the conditions under which they work at the coal face. It is true that the mine I visited, in Cynheidre, South Wales, has the best tradition of modern mining. The horizon method is used and this is particularly appropriate for anthracite. The latest and most up-to-date machinery is available. In addition, the pit is equipped with the most modern pithead baths and showers and excellent canteen facilities.

It was surprising, and I say this as a layman and I am sure that all laymen would feel the same, that despite the greatly increased mechanisation going on in the coal industry there is still considerable scope for pick and shovel work. Such work is particularly appropriate owing to the geological problems in anthracite mining.

I thought that I might have found some hostility on my visit to Cynheidre, because twelve months or eighteen months earlier I had been rather severely critical of the geological preparatory work which was conducted prior to the expenditure of many millions of rounds on this project. Needless to say, I was entirely wrong. I was met with the utmost courtesy and good humour wherever I went—that good humour which is one of the nicer characteristics of the South Wales miner. I was particularly interested to see at first hand the work of the present geological team working in the mine on the preparation of most detailed weekly reports. These show the conditions, the faults and fissures apparent in the mine and gradually make a case history of the characteristics of the colliery.

As each piece fits into the jigsaw, so gradually a picture takes shape and makes it rather easier for the geologists to find where the illusive seam is most likely to reappear when it disappears, as too often it does, either through the roof or through the floor. This, of course, is another occupational risk of anthracite mining.

I found particularly significant the obvious enthusiasm, keenness and good labour relations which existed between management and miners. The best reflection of this was shown in the fact that there has been a considerable increase in the output of this colliery over the last twelve months or so, and this has led to higher wages for the men working on the coal face. Although I recognise that conditions and relationships must vary at each pit, it is fair to conclude that the improved and record outputs per manshift achieved in the last eighteen months, coupled with the better training, show that there is a new spirit abroad, at least in some sections of the coalfield. This may not apply to Scotland but I believe sincerely that it applies to some parts of South Wales and I hope that these measures will play their part in bringing about greater improvements in the future.

Mr. J. Griffiths

First, because I am an old anthracite miner and, secondly, because Cynheidre is in my constituency, I am very glad that the hon. Member has been there. He made, as he was entitled to make, charges against and criticisms of the Coal Board a year or so ago which received wide publicity. I hope that the hon. Member's handsome tribute today will receive equal publicity.

Mr. Box

As the right hon. Gentleman knows, there was some publicity associated with my visit. Whilst not withdrawing my criticisms, I did suggest that any criticisms I made twelve months ago would certainly not apply today.

It is entirely in keeping with the modern conception of mining that an increasing number of miners are arriving to work today in their own cars. They put them in the car park, change into their working clothes, complete a shift—which is, admittedly, hard graft—and then emerge clean and refreshed from the modern up-to-date pithead baths and showers and take a meal in the nearby canteen.

Mr. E. Fernyhough (Jarrow)

Why not?

Mr. Box

I am all in favour of it, but customs die hard and I suppose that it is too much to hope for the conditions and good labour relations I have described to be achieved so easily in some of the older pits.

These improved conditions and labour relations much be achieved somehow if the industry is to move with the times and be in a strong position to meet and offset competition in the future from wherever it may come. The good results obtained during the past twelve to eighteen months have been obtained against the background of some recession in the country, with consequent reduction in demand, particularly from the steel industry. If these results can be maintained, the Coal Board can reasonably look forward to the future with some confidence.

The increased demand which must inevitably follow the recent measures by my right hon. Friend the Chancellor of the Exchequer, and the prospects of a still higher record output per man-shift in the future, should combine to place the industry in a strong position to meet this competition.

As the Budget draws nearer, I dare say that some of my hon. Friends and myself will be pressing the Chancellor to reduce the tax on fuel, because this has a striking effect on the cost of living, and, obviously, the Coal Board cannot expect the fuel tax to remain at its present high level for always. For the same reasons it may still be necessary to close some of the older collieries. Nobody wants to do this, but if they can only produce persistently low outputs per man-shift it is difficult to see any alternative.

Reference has been made to mobility. When I was in Cynheidre I met some miners from Durham who had come to South Wales. Some had settled down very well and some not so well. There were others who had returned to Durham. Reference has been made to out-of-work miners in South Wales. I would only suggest that if miners are prepared to come from as far afield as Durham then South Wales miners might travel from different parts of South Wales if jobs are available for them in other areas.

I suggest that, in view of the probability of increased demand and output in the future, as we have more and more mechanisation, greater emphasis will have to be put on the sales side of the industry. I welcome for this reason the scheme announced by the Coal Board earlier this year, appointing approved coal merchants. Hon. Members may have seen the blue signs outside premises or on vehicles stating that the merchant is approved. This is a great improvement. It will help to maintain a higher standard of conduct. It will give better service to the consumer. In many cases it will provide the technical services which are so necessary today in advising the consumer of the best and most economical fuel to be used in his apparatus. I suggest that it is also essential for the general good will of the industry. Furthermore, it might help to reduce the stocks we have heard about this afternoon.

Coal is such a complicated and mysterious commodity that it is difficult for the consumer to decide whether or not he is obtaining value for his money. Fuel is now such an expensive item that it is incumbent upon the consumer to find out whether he is obtaining the right type and quality. I would ask how many hon. Members ever examine fuel delivery notes. I would go further and ask whether they would be very much wiser even if they saw them. There are now so many processed fuels selling at different prices and under a wide variety of names that some confusion is bound to result. There is a special responsibility on the Coal Board to maintain a high level of integrity in its dealings not only with the merchants, but also with the consumer. This responsibility can be put even higher, because this is a monopoly industry, owned by the general public. What we have to achieve is a balance between that aspect and the commendable desire to make the industry pay.

The need for that has been emphasised in the recent Molony Report on Consumer Protection, published a few weeks ago, and in a special report on smokeless fuels resulting from work undertaken by the British Standards Institution and published last June. The findings of neither body are very encouraging. The British Standards Institution reported that there were unexplained variations in both the size and price of anthracite and that the ash and moisture content were much higher than they should have been. There was even one instance of a better fuel selling at a lower price. That may sound very good, but how many consumers would be aware of it?

I must, in fairness, say that the Coal Board disowned responsibility in that case, and the implication is that the fuel supplied under the name of anthracite was something inferior. That is very important to South Wales, in particular, because we produce the best anthracite in the world and are the largest anthracite producers in the United Kingdom. Therefore, if anyone in another area buys what is described as best Welsh anthracite we should do our utmost, and the Board should help, to make sure that the customer gets the right fuel.

Mr. Charles Loughlin (Gloucestershire, West)

The hon. Gentleman will probably agree that for domestic consumers of anthracite the Board runs a registration scheme with the intention of ensuring supplies of the right kind of fuel to those people. Apart from that, I cannot quite grasp how he can expect the Board to ensure that the supplier in a given locality is doing his job properly.

Mr. Box

I am unaware of the registration scheme to which the hon. Member refers, but the Board can be very influential in helping honest dealers —and this new scheme is a step in the right direction—to make sure that the customer gets what he pays for.

The B.S.I. report said that the moisture content in "Phurnacite" led to the conclusion that the fuel had deteriorated and, therefore, had absorbed an excessive amount of rain or other water during transit between colliery and customer. Whilst "Phurnacite" and"Gloco" were described as having the most consistent quality, the report clearly shows that there are excessive variations in the quality of smokeless solid fuel.

Other conclusions in the report show just as unsatisfactory a state of affairs. For example, it states: Many advertisements, instead of providing factual information, are specious and tend to mislead as to quality. Again, referring to the Clean Air Act, it says: We think that the inadequacies of some of the smokeless fuels (as delivered) may jeopardise the implementation of the Clean Air Act. Then there is the statement: We think the situation is so serious that it demands action. The report states, in regard to quality: It seemed that anything burnable might be called Best,' Hottest ' or ' Top Quality.' From the results one wonders whether these terms referred to the price rather than the fuel. In any event, price varied enormously, quality having little or no bearing. A good deal of that is confirmed by the Molony Report on Consumer Protection, and both Reports should be taken very seriously. The Molony Committee said that the main problem of the consumer was that until a fuel was actually burning in the fireplace it was very difficult indeed to decide what its qualities and characteristics were. It also stated that up to 1960 the Board had spent about £60 million on mechanised cleaning plant, and it is only fair to say that, as a result, complaints of foreign matter in fuel supplies are diminishing.

On the other hand, the Committee pointed out that if a merchant were thoroughly dishonest, and chose to water coke—and I gather that coke absorbs water very easily—the customer might find himself buying water at the cost of coke, coke being a very expensive commodity. The Molony Committee feels that considerable abuse has occurred in this field. These are serious and disquieting allegations which, whilst they may be outside the direct responsibility of the Coal Board, indicate that there is substantial room for improvement on the sales side—

Mr. G. Elfed Davies (Rhondda, East)

Surely the hon. Member is not desirous of again placing this liability on the Coal Board. It is time that the Government, which he supports, did something about that in several spheres.

Mr. Box

The Board is quite big enough and old enough to look after itself, and it can have considerable influence in this matter.

Any improvements on the sales side should include some independent, outside supervision of the Board's annual repricing and regrading review. Hundreds of thousands of pounds are involved in that review, and it would be in the best interests of both the Board and the consumer to have such independent supervision.

There is no doubt that much of the confusion I have described results from what can only be called uninformed buying by the consumer and indifferent selling by the merchant. A good deal of that could be eliminated if the consumer were to keep a close eye on the situation. I am sure that many consumers are unaware of the agreement between the Board and the merchants whereby, if a customer complains about the quality of the fuel supplied, the dealer is obliged to investigate the complaint very carefully and, if the complaint is found to be justified, to replace the fuel without cost. The Board might consider it advisable to give further publicity to that agreement. That would be a step towards preventing inequalities, injustices and unfairness between merchant and consumer.

With those reservations, I welcome this opportunity to support the Bill. I believe that the coal industry is on the up and up. That certainly applies to many parts of South Wales, and I hope that a great deal of the enthusiasm and the good relations I found in the pit I visited will spread throughout the rest of the United Kingdom. If those things can be maintained and developed, I see every prospect of increasing prosperity in the coal industry in the future.

6.59 p.m.

Mr. Charles Grey (Durham)

I hope that the hon. Member for Cardiff, North (Mr. Box) will forgive me if I do not follow him. I will only comment on his presumption in suggesting that, because he visited one coal mine on one day, we, too, should visit one and get all the knowledge he gained. Many of us have worked in the coal mines for nearly thirty years, and know nearly all there is to know about the work. If the hon. Member cared to work down a pit, many of his views might become very different from those that he has expressed.

I am glad that he paid tribute to a nationalised industry, which is more than anyone else on that side has done——

Mr. Nabarro

I have.

Mr. Grey

The hon. Member for Kidderminster (Mr. Nabarro) has had his fun and we do not want any more laughter when we are discussing a serious subject.

It is not my intention to go into all the ramifications of the activities of the Coal Board, but there are one or two specific items which I should like to mention. I wish to pay tribute to the National Coal Board for all it has done. Tracing the years back, one can truthfully say that the Board is now an institution which is part of our economic life which we cannot do without. We should take this opportunity of paying great tribute to the Board, together with the miners who work for it. Not once has there been any comment from the benches opposite about the work of the miners, who, along with the Board, should be given great credit for what they have done.

At one time, the Coal Board was the subject of great abuse. It became a well-known subject for music-hall jokes. Hon. Members opposite spoke contemptuously about the Board's officials. All that has changed, however. The Board has won through and has reached the stage when it can fairly claim to have done a pretty good job, even in spite of the Government.

What are the facts? Production this year has increased by 6½ million tons. The reason for this is higher productivity. It must be borne in mind that there are 20,000 fewer men in the industry, and this in itself is an achievement. At the coal face, output per man shift is 9 per cent. higher than last year. The industry generally has made good progress and I understand that the increased productivity is a record. We cannot allow these things to slip by without noticing them and the House should pass a vote of commendation to the Board and to the miners for these achievements.

We must, however, try to reach a position in which the mining industry is allowed to develop itself to its full and proper capacity. At the moment it is not allowed to do so, for two reasons. First, if the industry is to develop properly and fully, an expanding economy is essential. Secondly, there must be a national coordinated fuel policy covering electricity generating stations, coal distribution, oil, atomic energy and the rest. All these factors have to be considered.

There is not much need for me to prove the validity of my point that an expanding economy is necessary. Time and time again during the last four years, we on this side of the House have stressed in all our economic debates how great is the need for an expanding economy. Most people should know this, but it appears that the Government have not realised it yet. In the opinion of right hon. and hon. Members on this side of the House, an expanding economy is the only way to cure our serious unemployment position. In the position in which we find ourselves, the Government are not able to expand the economy to allow the coal industry to play its full part. The only people who do not realise this are the Government.

I shall deal with only one aspect of the desirability of having a national coordinated fuel policy, to which reference has been made by my hon. Friend the Member for Hamilton (Mr. T. Fraser) and my right hon. Friend the Member for Easington (Mr. Shinwell). When any of us get down to thinking about it, can we really say that we are right in basing our economy so largely on oil, which has to be imported from abroad? The Suez fiasco should have taught us the lesson of that. As we all know, at the suggestion of political trouble, the pipelines are cut, the sea routes blocked and the oil wells no longer operate. Therefore, by ever-increasing importation of oil we place foreign fingers around Britain's economic windpipe.

In doing anything like that, we place the country at a disadvantage, and we do so when we know full well that under our own countryside we have all the coal resources that we need.

Mr. Kershaw

Oil now provides about 30 per cent. of our energy requirements. What does the hon. Member regard as the safe proportion to be imported?

Mr. Grey

It is for that reason that I am asking the Government to prepare a plan to show our needs, which they are not doing. Oil is coming in wholesale on a free-for-all basis. The hon. Member should ask his Government to produce a plan to show where oil fits in. To rely solely upon oil and to fasten our economy to it is dangerous in view of events in the Yemen and what may happen in the Middle East.

We have the coal right beneath our feet. We have miners who go down the mines and work in conditions of extreme danger, of which the general public have not the slightest conception, although possibly the hon. Member for Cardiff, North now realises how difficult the work is. The general public, however, do not understand. The miners are prepared to dig the coal as long as they get an opportunity to do so. The miners want to work in our own coal fields and to make their contribution to the economy of the country. They will do it if they are given security of employment in their industry.

When miners dig our own coal in our own country, all the money that is earned goes into our pockets and helps the welfare of British people. I hope, therefore, that when the Minister and the Government consider a national fuel policy, they will consider these points concerning oil in addition to what has been said by my right hon. Friend the Member for Easington and my hon. Friend the Member for Hamilton. We cannot, and we dare not, place too much reliance upon oil. We must give an opportunity to get as much coal as we can, because I am certain that if given the opportunity the National Coal Board will play its full part.

I wish to refer briefly to a local matter, the siting of a power station in the north of England. I am glad that the Minister has returned to the Chamber. I hope that he has enjoyed his food and will enjoy what I am about to say so much that he will grant my request. All of us on this side, including, for example, my hon. Friends the Members for Chesterle-Street (Mr. Pentland) and Houghtonle-Spring (Mr. Blyton) and others, were delighted when we thought that we would be having a power station in County Durham. The Government, however, are moody; they never know what they will do next. They come out with all kinds of surprises and with some shrewd shocks. Our shock came when we were told that a power station would not be built.

I believe that such a decision is completely crazy. We cannot understand it. There are any number of facts to put to the Minister that would prove that a power station in Durham would be a great benefit. A power station built somewhere in the County of Durham, wherever the site may be, with a capacity of about 2,000 megawatt, would consume some 5 million tons of coal per year. It would keep in employment between 10,000 and 12,000 men. But the benefit would not stop there. The benefit would extend because there would be the social effect of keeping these men in employment. It would spread out to the shopkeepers and other services in the mining community. I estimate that if a power station were put in Durham the full effect would spread out to a total of 30,000 people and, maybe, even more. I should have thought that that was a pretty good reason why a power station should be put there.

There are, in fact, three reasons. A power station in Durham would be the easiest and cheapest form of providing employment. I say that because we have serious unemployment in the North-East which does not relate only to miners. We have other people unemployed as well. Recently we had a statement from the Board of Trade that there were to be five factories built in Durham. Each factory would employ about 200 people and the total employed would therefore be 1,000 people. We want all these. The President of the Board of Trade did us a good turn by saying that he was going to do this. But if the factories are built that is not the end, because tenants will have to be found for them. The mere building of the factories could be just a piece of political window-dressing. We have to have employment that is suitable to the people. A power station would provide employment without any bother at all.

I repeat that it is the cheapest form of providing employment. But the power station must be planned now. The decision must be made very shortly, otherwise the manpower will run down and once it has been dispersed it will never be regained. I know that there is an argument, and perhaps the Minis- ter may use it, that the coal might have to be a little dearer. The coal from Durham for a power station, I understand, would be sold on the same basis as East Midland coal. I think that there would be a coal field addition of 5s. a ton. But the cost of the transport of Durham coal to the power station could be minimised to take care of this extra cost. The transport cost would level out the 5s. a ton extra.

My final point—this is very important and would please the hon. Member for Kidderminster—is that there would be no further capital investment needed in our Durham colliery to provide the tonnage of coal that a power station would require.

Those are the three factors which the right hon. Gentleman ought to take into consideration. I think that, having these things on our mind and this knowledge, it would be complete nonsense not to build this power station. This decision to cut back and not to build a power station in Durham is still allowing the transfer scheme to exist so that men are being moved away from Durham. I am not saying that a transfer scheme should not take place in every case, but I believe that there are 10,000 men in Durham now who should stay there—that is the point that I am making—and there are many miners who have left Durham who would not have left had they known, or been assured, that a power station would be built.

Dulling the last two years 400 men have left Bowburn colliery in my constituency. My hon. Frend the Member for Sedgefield (Mr. Slater) has lost men in his area and is continuing to do so. It is tragic when these redundancies take place. But one blessing is that we have such marvellous employers in the National Coal Board. I pay tribute to them because they are carrying out these transfer schemes in such a way that many people have been placed in employment and found themselves happy and contented. I want to say about the Dunham Division of the National Coal Board that no set of employers anywhere could have bettered anything that they have done. I think that hon. Members should take their hats off to them for doing a very difficult job.

It is not an easy task to tell miners that if they want a job they will have to go to Yorkshire or somewhere else; that they will have 'to dig up their roots. The National Coal Board, in consultation with the trade unions, has done this job remarkably well. The amount of good will that has been exercised on all sides is amazing, and these schemes have been carried out 'with the minimum of 'trouble. I believe that, bearing in mind these things, if a power station were decided upon in Durham this drift could be halted and the men could be kept there. It only needs the Minister to say, "Yes, there can be a power station in Durham," and a decision must be made very shortly.

The mining industry has now been under social ownership for fourteen years. It has been one phase of steady progress. The N.C.B. and the miners have done a remarkably good job. I believe that they would keep on doing it if only they had a Government that would see that they had a fair chance to carry out their own work in a way that would give them every kind of confidence.

7.20 p.m.

Mr. Forbes Hendry (Aberdeenshire, West)

It may seem strange that a Member for an agricultural constituency in the far North who has not one miner in his constituency, should take part in the debate, but, in fact, it is not strange, because I spent the greater part of my life in the south of Scotland, in a mining district. I know the Scottish miners and their position, and anything which affects them must be a matter of concern to me.

I understand their anxiety at the reorganisation going on in Scotland, but I think that many of them will understand only too well that it must take place. Reorganisation is nothing new. It has been going on ever since I can remember, and by and large the results have been good. Most mining people will realise the truth of what the right hon. Member for Easington (Mr. Shin-well) said about working uneconomic pits. Any miner knows that to work such a pit is merely a matter of digging holes and filling them up again, doing no good to anybody.

I ask my right hon. Friend the Minister of Power to collaborate as closely as possible with my right hon. Friend the Secretary of State for Scotland in easing the reorganisation process as much as possible, particularly in central Scotland. He should bear in mind that, if miners must be moved from one coalfield to another, their families must go with them, and that, in addition to providing alternative employment for the miners, it is essential to provide it for their wives and daughters as well.

But that is not the prime reason for my intervention. I am very concerned about a new process introduced by my right hon. Friend a year ago. He announced that he intended to introduce differential increases in prices between different parts of the United Kingdom. Hitherto, all increases in coal prices had been uniform throughout the country, but this time he made bigger increases in Scotland and the north-west of England than in the rest of the country.

If the coal industry in central Scotland and the north-west of England were in a bad way, the worst way to counter the situation was by increasing the price of coal to a higher extent in those parts of the country than in others. Not only was the industry itself harmed, but there was a snowball effect throughout other industries as well. This applied particularly harshly in my constituency, where paper-making is a principal industry. I am told by the paper-makers there that the effect of the differential increase at that time was to put up their costs by not less than 4 per cent. over their competitors in England.

Aberdeen and district are very far North and far from the major centres of population. The margin on which paper-makers and other industrialists work is very narrow and a 4 per cent. increase in costs may make all the difference between profit and loss. The effect of this increase has been serious and I understand that there is a possibility that expansion of paper-making in the far North may not take place if the difference in the price of the coal in the north of Scotland compared with the price in England remains as high as it is.

I ask my right hon. Friend to look at this question of the margin which he is taking away from these industries by increasing the price of coal in Scotland to a greater extent than in England. It is a serious matter for industry throughout Scotland, particularly the North.

The traditional source of house coal in Aberdeen and the north-east of Scotland has not been the Scottish, but the English coalfields. Nevertheless, the price for house coal in the North-East was put up by £1 a ton as against 10s. a ton in England. The coal merchants in Aberdeen district, applying to the customary source of supply in the northeast of England, found that the price of coal for supply in Scotland was to be increased not by 10s. a ton, which was to be the normal increase in price for coal from Northumberland and Durham in other parts of the country, but by £1 a ton.

This meant great 'hardship to people in the far north of Scotland, who were paying higher prices than people in other parts of the country which were more accessible from the coalfields. The unfortunate thing is that this vast monolithic monopoly of the Coal Board was not content with increasing prices, laying down the law and making things difficult for industrialists generally. To all intents and purposes, the Board forbade the import of coal from continental countries and America to industrialists in the North. This was a very great hardship and should be reconsidered by my right hon. Friend, because ports like Aberdeen are, in practical terms, far nearer to other coalfields than they are to that of central Scotland because they can obtain coal from them much more easily.

Miss Margaret Herbison (Lanarkshire, North)

The hon. Gentleman has made an important suggestion to the Minister of Power, to allow coal from America or the Continent to come in for the north of Scotland. Will he also, in our next agricultural debate, make the same plea to the Secretary of State for Scotland to take away all the safeguards that the farmers have in the North?

Mr. Hendry

This is not an agricultural debate and I would be out of order if I answered the hon. Lady's question. But if she cares to sit through the agricultural debate tomorrow I may be fortunate enough to catch your eye, Mr. Deputy-Speaker, and then I will give her the answer.

Apart from the import of coal from America or the Continent, there is always the possibility of getting industrial coal from the north-east of England. There are large stocks of coal which I believe we import into Aberdeen with very much less trouble than from central Scottish coalfields. But in view of the policy laid down by my right hon. Friend a year ago again we come up against monopoly.

Yet the Coal Board is not a completely monolithic monopoly, because a certain number of pits are under private enterprise. It is extremely interesting to see how they compare with the nationalised industry. It is difficult to get figures, but I got some from the Board today. I find that output from these licensed mines in 1961 was no less than 2¼ million tons in round figures, which is quite a sizeable proportion of our coal output. The number employed in these mines was 4,799 and output per man over the years was on average 474 tons. That compares very favourably with output from the Board's own mines, where the average output in 1960 was 278 tons per man employed in the industry.

Thus, these little mines—it may be that they are working in different conditions—are doing very well. They have a good output and it is obvious that the men working them would not be doing so except at a profit. In almost every case these mines are owned and worked by working miners. They know the job and are doing it remarkably well, but, unfortunately, they are not doing as good a job as they otherwise could. That is because for some reason that the Coal Board sets a target figure for these small mines, and each is given a quota beyond which it may not go. Hon. Members opposite who represent mining constituencies, especially in Wales, will know something about this system.

This seems to be an extremely foolish and short-sighted policy on the part of the Coal Board. For a number of years total output has been fixed at 2¼ million tons, although I am told by miners working these mines that they could produce much more more profitably.

Miss Herbison

The hon. Member has quoted Coal Board figures about the number of men employed in licensed mines and the amount of coal they produce. Has he not also inquired into the conditions of the men who work in some of these licensed mines—not all of them, as I know through having some in my constituency? Do they have the same safety precautions as those enforced by the Coal Board? I could list many things, and I hope that the hon. Member will inquire into those, too.

Mr. Hendry

The hon. Lady has many of these mines in her constituency and I have had the privilege of seeing some of them, as she well knows. I have had a close connection with a number of small licensed mines in other constituencies. At one time I had a considerable interest in some of these small mines, although I no longer have. As the hon. Lady well knows, the conditions in these mines are exactly the same as those in the bigger mines run by the Coal Board. They are operated under the same legislation and are inspected by the same inspectors of mines as the mines run by the Board.

Mr. A. Roberts

I have had to inspect several of these mines. The difference between them and the Coal Board mines is that the small licensed mines are more unpleasant. Invariably, they are near to the surface and, consequently, are wet. However, they all come under the Mines and Quarries Act, 1954.

Mr. Hendry

Some may be wet and unpleasant to work in, but nobody forces men to work in these mines. I think that the hon. Member for Normanton (Mr. A. Roberts) will agree that many of the men who do so work there of their own free will as a natural choice.

Miss Herbison

Not at all.

Mr. Hendry

That is my experience. They are doing a good job. I do not contend that they should get any advantage over the Coal Board, but I think that they could do a better job if only the Board would take a less short-sighted policy towards them and would increase to the maximum the amount they could produce, always having regard to the possibility of accumulated stocks of unsaleable coal, although that is not a valid argument because privately-owned mines will not produce stocks of unsaleable coal if they can avoid doing so.

These mines are run under the same conditions as Coal Board mines and are inspected and are subject to wage and price control in the same way. The only difference is that they may have pithead customers. I have been such a customer myself and I have had very good service. They have a part to play in the industry and they should be allowed to play it without unnecessary restrictions.

I join with all those who have said that the Coal Board has recently done an extremely good job. The Bill will help it to continue to do a very good job, and for that reason I support it. However, I ask my right hon. Friend to keep in mind, when considering future policy, that he should have regard to the families, especially the daughters, of miners who are transferred from one pit to another; that in fixing increases in prices he should have regard to the effect on industry generally, especially in those parts of the United Kingdom like Scotland and the north-east of England where industry is badly required and where increases in the price of coal beyond those in other parts of the United Kingdom may have serious repercussions on industry generally; and lastly, that he should do what he can through the Coal Board to encourage private enterprise in the part it has to play in coal mining.

7.35 p.m.

Mr. Albert Roberts (Normanton)

I welcome the Bill because it gives us an opportunity to talk about the coal mining industry. I should like to follow what the hon. Member for Aberdeenshire, West (Mr. Hendry) said about the small mines, because that is an interesting topic, but I think that I will leave it where it is because it has been explained that these mines come under the Mines and Quarries Act, 1954. They have a part to play and most of them work coal which it would not be profitable for the National Coal Board to work.

However, I want to deal with the hon. Member for Kidderminster (Mr. Nabarro). It is all very well for him to dance about on the benches opposite and say what a wonderful job has been done since the appointment of Lord Robens. Lord Robens is quite an able man and I do not want to denigrate his work, but it is wrong to suppose that it is only since he came into office that the Coal Board has started to look up.

I can remember a previous Minister of Power saying what a dynamic personality was Sir James Bowman, who was recommended by Dr. Fleck. I can also remember the late Sir Hubert Houldsworth. Both those chairmen of the Coal Board had gigantic tasks. Anyone conversant with the mining industry knows that coal production is not a matter of putting down a cement bed, putting machines on it and operating them. Sometimes it takes eighteen months to drive across drifts in a coalmine. It sometimes takes two years to reach the kind of seam required. Only now are we starting to get the benefits of the admirable work which has been done by previous Coal Board chairmen, and that should be fully understood.

While I welcome the efforts of the present chairman, I must point out that those inside the industry have been making their efforts since the industry was nationalised. Coming as I do from the coal fields, I would say that 98 per cent. of the men in the industry do not know who the chairman of the National Coal Board is, but they are all doing a job. Their interest is in doing a good job and in getting good wages.

The hon. Member for Cardiff, North (Mr. Box) referred to his visit to a coal mine and spoke of the number of cars he had seen in the pit yard. It may seem that all is well in the industry, but he should clearly understand that there are thousands of mineworkers whose wages are just over £10 a week, and that at a time when Ford's can pay £11 a week for men not to work. We must bring home to the Minister the need for some revision in the pay of men receiving these meagre wages. They are making efforts on behalf of the industry and if their pits close down, they often have nowhere else to go, especially when they are over 45. I hope that the Minister will remember the wonderful behaviour and discipline of the National Union of Mineworkers, the colliery managers and others connected with the industry. Those connected with the mining industry have for years been striving to make this an industry which can be respected, and I am pleased to say that since nationalisation we have succeeded in doing that.

There has been a lot of talk about finance. It has been said that a surplus should be called a profit. We ought to bear in mind the fact that since nationalisation there has been an operating surplus, or profit, of more than £230 million. The millstone round the industry's neck has been the rate of interest charges, which has continued to rise. It has risen from 3 per cent. to 5 per cent. This is something over which the industry has had no control. The Government decided to put up interest rates, and the industry, as has been said, had to provide coal almost as a public service. In addition, we must remember what has been said many times during debates on the coal industry—and this was mentioned by my right hon. Friend the Member for Easington (Mr. Shinwell) whose profundity of understanding on this issue is deeper than mine—that the import of American coal cost the Board £70 million.

When we on this side of the House argued that the price of coal should find its own level, the Treasury said that the Government had fixed the price and the Board therefore had to adhere to it. It is easy to say now, as some hon. Members have said, that the industry must work for a profit, that it must work on a commercial basis. The industry has passed through various vicissitudes, and I am delighted that through the efforts of those in the industry we are now beginning to turn the corner. In 1955 we were told of the golden prospects for the mining industry. Unfortunately, almost immediately there was a recession which lasted from 1956 to 1961.

Reference has also been made to the stocking of coal. Hon. Members should consider the result of that policy. It meant that men were kept off public benefits. If miners had been put out of work they would have drawn unemployment benefit. By keeping them at work millions of pounds of public money were saved. This policy of keeping men at work meant a charge against the industry, and the Government failed to take cognisance of that fact. If the Government had offered financial assistance, this would have been greatly appreciated.

I wonder what would have happened if the mines had been privately owned. Look at what happened to the cotton industry. It was advised by the Government to contract, and then what did the Government do? They paid £30 million by way of compensation. No such compensation has been given to the Board. I say again, therefore, that I wonder what would have happened had the mines been privately owned.

Mr. Hendry

If a mine had been privately owned, it would have gone bankrupt and many people would have been out of a job, because such a mine would not have been able to borrow from the Government as the National Coal Board has been able to do.

Mr. Roberts

I do not know whether a private mine would have gone bankrupt or not. I remember that between 1920 and 1926 coal owners received a subsidy. Some of the money that was provided was really wasted. Time and again—particularly between 1956 and 1961—thon. Gentlemen opposite have pilloried the Board, and that is why I say that we need a measure of sympathy on this issue.

Everyone, including the National Union of Mineworkers, is in favour of progress in the industry. Those in the industry are in favour of increased mechanisation, and I am speaking now as a mining engineer whose duty it was to inspect more than thirty pits. We have always been in favour of progress. We realise that many a false step can be made by standing still. We are not against the closing of uneconomic mines, but it must be remembered that grave social consequences can follow from such a policy.

It is easy to say, as the Parliamentary Secretary said, that some pits will have to close and that the men will have to be found other jobs, but it is not possible to find jobs for men over 45, for the simple reason that nobody wants them. The Minister should realise that even in the prolific coalfields of Yorkshire some mines are exhausted, and in my consituency, which has one of the largest new pits in Europe, some mines are to be closed, and it will not be possible to provide alternative work for the men who become redundant. As a result of these closures, between 200 and 300 men over 45 will become redundant. Where else can they find work? It is for this reason that I support the plea made to the Minister that there should be better co-ordination between him and the President of the Board of Trade.

It is wrong to wait until the men actually become unemployed. There should be a greater measure of planning and co-ordination between the two Departments to which I have referred to ensure that these men are found alternative employment. I am not dealing with percentages of unemployment. If one man is unemployed he thinks about himself and looks around to see whether he can find other work. If he has a moderate-sized family, his position can be rather tragic. My heart goes out to anyone who finds himself in such a situation, and that is why I think that we ought to work together to see whether we can solve the problem of men becoming unemployed.

I support the plea that has been made for the building of power stations. I agree that one should go to Scotland and one to the North-East. I am not so much troubled about those power stations which are to be built near oil refineries. Ours is an expanding economy. If production increases, there will be a demand for more power, and there is no reason why the demand for coal should decrease.

It has often been said that by 1965 there would be parity between coal-fired generating stations and those operating under nuclear power. Progress to date, however, proves once again that the Government have been wrong in their calculations, because nuclear power stations will not achieve parity with the traditional power stations until at least 1975. We were told that the last traditional power station would be put down in 1965, and I hope that the Government will now be prepared to admit that their calculations were wrong.

I believe that there is a great future for the coal industry, provided we have a proper fuel plan. There is a need for gas, electricity, and to some extent oil, and I conclude on this point. For the past few weeks the Minister has been silent about the Lurgi plant. Together with the chairman of the National Coal Board I saw the Lurgi plant in operation in Australia. Out there they were using an inferior type of coal with a high water content, but nevertheless the plant was working successfully. We have two pilot Lurgi plants, one in the Midlands and one in Scotland. We are anxious to know whether these pilot schemes are proving a success. We hope that they will. I think that it would be a far better proposition if we could develop along those lines and thus avoid the embarrassment of tremendous quantities of coke which cannot be used. Again, if we use the Lurgi plants, it will not be necessary to import liquid methane. I hope that we shall have some news about these plants.

The Bill has given us a wonderful opportunity to say something about the industry. The Minister will appreciate that those who are connected with it are always ready to play their part. I hope that he will do something about the promise made by the Coal Board a short time ago, that if output per man-shift rose to 30 cwt. per shift the question of a seven-hour day would be considered. I believe that in the past few weeks the output has risen to ()NTT 30 cwt. per man-shift and there is a possibility that in the near future the figure agreed to between the Coal Board and the N.U.M. will be reached. As a gesture to the industry, and without arguing about the matter, the Coal Board should say, "The industry is healthy, and we wish to keep it healthy. We have the good will of the men, and we wish to keep that good will. They can have a seven-hour day."

I entered the mines when I was 14 years of age, and we had a seven-hour day until 1926. Here we are, thirty-six years later, and the miners are working a seven-and-a-half-hour day. I trust that the Minister will have the privilege and honour of saying that we can revert to the position that we were in before 1926.

7.51 p.m.

Mr. Emrys Hughes (South Ayrshire)

I wish to thank the Parliamentary Secretary for his sympathetic references to the tragic disaster that took place recently at the Barony Colliery, in South Ayrshire—my constituency. This was an unexpected blow, in an area where several other small collieries were doomed to close under the pit closures plan. The disaster took place in a quite unexpected area, and put out of action a very large colliery from which the National Coal Board estimated that it would get a regular supply of coal for many years. There have been all kinds of mining accidents, but this was a rather strange one. It was due to the collapse of one of the shafts, by the caving in of the ground around the shaft in a way that nobody ever imagined possible. A great effort was made to deal with this situation, in which four miners lost their lives. They quite literally lost their lives trying to save the pit and the work of their comrades.

This mining area now faces a difficult problem, which, as the Minister has said, the Coal Board is coping with as promptly as it can. But it is estimated that the minimum time that must elapse before the pit can be brought into operation again is two years. When the plans are made and the engineers report the Board may have to consider the relative cost either of building a new shaft or constructing an entrance from another colliery. Some financial advisers may think that it would make a difference whether the area was goin2, to show a profit or a loss, but I submit that in this case a long-term view should be taken. The Board should not be encouraged or tempted in any way to postpone a decision or cut down expenditure.

I acknowledge the interest taken by Lord Robens in this matter. The Board knows that a vast supply of coal is available in this area. It is estimated that millions of tons still remain to be won from this colliery, providing employment for the next thirty or even fifty years, if access can be gained to it.

It is clear that while the preparatory work is being undertaken this community will be faced with a grave social problem. I am grateful to my hon. Friend the Member for Hamilton (Mr. T. Fraser), who has so clearly explained the prospects of this locality during this period. I realise that we have received sympathy, but I want to know whether sympathy is to be expressed in a practical manner, by every possible effort being made to absorb the labour of these men, until, we hope, they can get back into the colliery again.

The hon. Member for Aberdeenshire, West (Mr. Hendry) hoped that the Minister would keep in touch with the Secretary of State for Scotland. I also expressed that hope, and I hope that he will also have consultations with the President of the Board of Trade. The Secretary of State could do a great deal by pushing forward the necessary works of reconstruction—works which are necessary in the social interests of this community, on roads, water supplies, land reclamation, and even forestry.

There are many schemes which, if the Secretary of State for Scotland cooperates with the President of the Board of Trade, will enable this labour force to be mantained, so that the people will net drift away as they may do if it appears to them that nothing is going to be done for them. These people have been brought up in this locality. They are skilled men, who know the pit. Their lives have been very closely associated with it. It would be an industrial mistake and a human tragedy if they were allowed to drift away so that, when the colliery was ready to be opened, the demand for skilled labour could not be met.

This colliery has had a great record. There have been no difficulties in industrial relations. The number of strikes has been very small. Lord Robens has said that the colliery did not deserve this, and neither did the community. In those circumstances I hope that the Secretary of State will co-operate and help the progressive local authority to go ahead with schemes of work which will help to keep together this necessary labour force. I also hope that the President of the Board of Trade will continue to help in establishing alternative industries. We have had some news of a factory being provided in that area, but, in the reply to a Question which I received from the President of the Board of Trade today, I was told that the area of the factory would be 15,000 sq. ft. I cannot conceive of that being a factory that will solve what was the serious unemployment problem before the Barony tragedy came upon us.

I therefore hope that in Ayrshire we shall get not one small factory, but something like the industrial estates which were so beneficial to South Wales, or a trading estate, like Treforest, which has been the means of employing so many miners who were unemployed in South Wales. This problem of the Barony is the problem of the whole of the industrial and mining areas of Scotland. We want a great effort to be made to see that all the Ministries are working together so that industry may continue in this part of Ayrshire. I suggest that far more attention will have to be devoted to efforts of this kind than have been made hitherto. There is a great need for urgency, or imagination and for planning ahead in order to keep this coalfield going and to employ those who are now unemployed through no fault of their own.

We have had interesting interventions in the debate today, including one from the hon. Member for Kidderminster (Mr. Nabarro). He has suddenly become complimentary to the Coal Board, because he says it is now making a profit. Who knows? The time may come when we may have an opportunity of examining a nationalised carpet-making industry, and then we shall be able to look into it to see exactly how much profit is being made, how efficiently it has been run and how much profit has been taken out of the industry in the past. I am not so sure that the hon. Gentleman would be so enthusiastic about Dr. Beeching then, especially if the latter tries to solve the problem of cutting down expenditure on the railways by removing the carpets from the first-class carriages.

I am very sorry indeed that the Minister has lost the services of such an able assistant as the hon. Member for Glasgow, Pollok (Mr. George), who spoke from the Dispatch Box recently. The hon. Member was a very hardworking Minister and one with very great experience, and I say that because I have known him for over thirty years. He was a colliery manager in my area, and was at one time my political opponent. The hon. Gentleman is unique in his knowledge of the mining industry, because I can think of no other instance in our political history in which a man who had started work in a coal mine actually appeared on the Front Bench in this House under a Conservative Government. This was a great asset to the Minister of Power, because I know that the hon. Gentleman's idea of a holiday was to spend it visiting coal mines.

As one who has had the experience of the hon. Gentleman's company on a good many of these expeditions. I know how useful he was to the Ministry in a technical sense, and the experience, energy and conscientiousness which he devoted to his work in the Department. I believe that there is a general feeling of regret, especially among coal miners—I am not at all disparaging the Minister—that the hon. Member for Pollok has had to discontinue his work at the Ministry because of ill-health. We hope that he will be able to be back with us and resume his duties in the House as soon as possible.

We have heard a good deal today about mining as an industry. I remember that, when I first stood as a candidate for Parliament, the late Bernard Shaw wrote to me about the affairs of the coal industry, and said, "Coal mining is not an industry; it is an atrocity." There is a good deal in that. Whenever I go down a coal mine, I watch the men working away in the bowels of the earth, and I wonder how men could ever be persuaded to work in mines. Today, the demand in the area of which I speak is for the reopening of the Barony Colliery. There is more affection for the Barony pit than there has been in my memory for the last thirty years.

None of us takes a romantic view of coal mining, and we should all be very glad if we could see this industry rendered unnecessary, because we were able to get our fuel and power from some other and more civilised source, but, while it is still there, we have to do our utmost to see that conditions are established which will satisfy the consciences of all of us.

Unfortunately, during my time as Member of Parliament for South Ayrshire, I have had to be at pitheads following three rather big pit disasters. There was the one at Kames, and the recent one at the Barony, but the one I remember most was the Knockshinnoch Colliery disaster in New Cumnock, a pit now doomed to be closed if the Coal Board's plan materialises. There are men who are thinking that it will be a tragedy when Knockshinnoch closes down. I remember very vividly those very tragic days when we waited at the pithead to find out whether the rescue team underneath were able to get to the men endangered on the other side of a barrier of gas and coal.

We were waiting in the colliery offices—a group of variously assorted people from different walks of life, watching the map of the workings below and wondering whether the rescue party was work- ing its way through foul gas and old workings to get at the men who were trapped. I am very glad to say that its efforts were very largely successful. I remember that, as we sat there, hardly anyone exchanged a word, because we knew how dangerous it was and how much hung on the efforts of the men in the rescue party. There were men sitting round the table who were associated with all branches of the mining industry. There was Lord Balfour, then chairman of the Coal Board, Arthur Horner, secretary of the National Union of Mineworkers, Pearson, the secretary of the Scottish Mineworkers' Union, and Abe Moffatt; and we had the experienced managers and technical people from all around.

There they sat, looking at the map on the table, and hardly a word was exchanged. We were all watching the red arrows which pointed the way for the men of the rescue party. Ultimately, came the great news—the almost miraculous news—that this astounding rescue effort in mining history had been successful. I remember seeing those men come up to the pithead, scrambling into the light of day, where, once more, they knew normal life again. All the arrows were pointing the same way. All the energy, brains and experience and all the human feeling was bent on one object.

In one sense we have the same problem in that area today. From all walks of life people interested in the social welfare of the district are all wondering what can come of their energies. Ultimately, can this community be saved? Will the arrows point the right way and can we save the economic life of that pit as we saved those men who, at one time, we thought were doomed to die in the darkness?

I ask the Minister for all the co-ordination possible, so that this community may be urged to keep together. If finance is needed by the local authorities, let them be given it willingly and without hesitation. Above all, let the right hon. Gentleman see to it that there is alternative industry. If this is done there will be a response from this coal mining community to that larger community which depends on the industry and on the people who have given of their best for this country and for the generation in which they live.

8.11 p.m.

Mr. Joseph Harper (Pontefract)

The hon. Member for Kidderminster (Mr. Nabarro) estimated that the manpower needed to meet future requirements in the coal industry would amount to 500,000 men. The present manpower figure is 540,600 and so the hon. Gentleman would chop off 40,600 men from that figure. I wish it were possible that the hon. Member for Kidderminster could be one of the workmen who will have to work in the mines. The hon. Gentleman fails to realise that the increased productivity in the industry has been achieved by real hard work and by mechanisation so that the miners have been able to produce at a figure, never before achieved in the industry, amounting to over 32 cwt. per man shift.

The hon. Member for Kidderminster eulogised the chairman of the National Coal Board, Lord Robens, and made it appear that by a wave of his magic wand Lord Robens had changed the Coal Board's deficit into a profit. I do not know what his lordship will think when he reads that statement. I do know what the workmen in the industry will think. They will wonder what part they have been playing. I wish to emphasise that the coal industry has always shown a profit, and I shall prove that statement.

This Bill makes two recommendations. First, it is designed to provide for a temporary deficit which may arise during the coming twelve months and it empowers the Minister to act as a banker, as it were, and to be the source from which the Board may borrow money, if necessary, up to a maximum of £20 million. By the provisions in Clause 2 there is an alteration in the Coal Board's financial year. I cannot understand why that should be necessary. I do not object to the alteration and if the Board can operate at a profit by reason of an alteration in a financial year from December to March, I do not think there will be any objection from hon. Members on this side of the House. The Minister said that the Bill was a simple Measure. Later he said that it was an innocuous Measure and I am beginning to wonder what sort of a Bill it really is.

After the industry was nationalised in 1947, and during the fifteen years which have ensued since that time it has made an operating surplus of £223,700,000. After that figure has been manipulated and an interest repayment made, amounting to £345 million, there is left a total deficit of £92.8 million. That figure represents less than 1 per cent. of the Board's annual turnover and so it is not as high as it might appear.

In addition the Board has borrowed £643 million, of which £37 million has been repaid. This money was to be used to revitalise the industry and, speaking as the newest recruit to this House from the Yorkshire coal fields where I spent thirty-four years working underground, I am able to say that this money was used for the provision of plant and machinery as working capital and for financing stocks, about which I shall have a word to say later. Originally the money was borrowed at an interest rate of 2½ per cent. But, owing to Government policy, the interest rate rose to 5½ per cent. thus adding to the burden which the Board had to bear.

Through all these years the Board has been operating on a system of "heads you win, tails I lose". That applies to the coal industry more than to any other industry whether nationalised or not. In the period from 1947 to 1956 the industry was recognised as a public service and the ever-growing demand for coal made things easy. First the Labour Government and then successive Tory Governments implored the Board to produce as much coal as possible. It was a case of coal at any price. Even under those circumstances our coal was £2 a ton cheaper than West European coal and cheaper, after freight charges had been paid, than American coal. The Board was instructed by the Minister to import coal for which it had to pay. That cost us £70 million. When I say "us" I speak as a man in the industry.

During the second period, from 1957 to 1962, demand fell, owing to a combination of circumstances, and the plan prepared by the Coal Board and the Minister in 1956 had to be modified. It had been said that 240 million tons of coal would be needed in the years ahead. After we had gone to a lot of trouble over borrowing money and making a plan to secure this amount, it was discovered that there was not a sufficient demand and the amount was reduced to 200 million tons. But the financial and other burdens still had to be borne with this reduced tonnage. A simple analogy to explain the situation is provided by imagining that British Railway bought an engine sufficiently large, and strong enough to pull a hundred wagons of coal and paid £X,000's for it, only to discover that the engine would never be called on to pull more than fifty wagons. British Railways would still have to pay for this big engine to do only half the job.

That is the position the Coal Board was in. The N.C.B. deficit, which in the ultimate gives rise to a Bill such as this, would not have been necessary if a proper policy had been carried out. It is directly attributed to the Minister's policy and not to lack of efficiency on the part of the Coal Board or anyone working in the industry. In the second period the Coal Board has no reserves and there was no transitional period to tide it over or give a breathing space in which it could become competitive.

I remind the House that we are not asking that the Board should borrow money interest-free, but we feel that some of the liabilities due to past neglect should be written off Vast sums were needed to revitalise the industry and there was the unfair nature of fixed interest charges on the industry's reduced capacity. During the first eight years after nationalization, the N.C.B. was a monopoly supplier of a vital and scarce commodity, of which position it could not take advantage. We on this side of the House have an overwhelming case for relieving the financial burden which is placed upon the Coal Board. We feel that the absolute minimum that could be given to help the Board would be to wipe off the £92.8 million accumulated deficit and to make substantial reductions in the Board's liability for interest payments.

We cannot object to pits being closed where resources are exhausted. No one can object to that for it is no good having a cage running up and down with no coal to pull, but we feel that we have made a case for keeping most of the economic pits open. If we had been allowed to take advantage of 'the position in the eight or ten years after nationalisation, as one hon. Member explained, we should have had £500 million in reserve. That could have been used to help those pits, especially until the Government found some alternative employment for the men in them.

I do not know if hon. Members opposite realise—I do because I have been in this predicament—all the social consequences which emanate from the closing of a pit. I remember the time when one could walk through a shopping centre in a mining town and find it easier to count the shops which were open than those which were closed. There were dismal conditions and a lack of amenities in the villages and the loss of dignity of the people who previously had worked in the pit and could not find other employment. That could be elaborated much further.

The Coal Board has never had a chance of making a go of its financial obligations. It has been said by hon. Members opposite, both in this Chamber and on public platforms, that if we continue with this type of Conservative administration we could double the standard of living in twenty-five years. That would be very nice and no one would take any exception to it, but if it is to be brought about more energy must be produced. Let us tackle this job in future as it should be tackled. Let us have a nationally co-ordinated fuel policy embracing not only coal, but atomic energy, natural gas and oil. They can all play their part. What is more important is to know the extent to which they would have to play their part so that they can make proper plans.

As everyone in this House realises, the strain on our balance of payments if we continue to place too much reliance on oil will be very sharp and acute. We have an indigenous fuel and we have the men to win it. It can play a prominent part in the future of this country. In order to give some substance to what I have been saying, I shall quote something which appeared in the Report of the Select Committee of the House of Commons on Nationalised Industries. It has been quoted before, but it is worth quoting again: If decisions are to be taken on grounds of the national economy or of social needs then the additional cost should be provided in advance out of public funds and 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. This has not been adopted in the case of the National Coal Board. The cotton industry was allowed £30 million to contract. That was done quite rightly. Under the new Transport Act the railways deficit of £400 million has been written off and another £800 million has been placed to suspense account with no interest-bearing qualities. It is to be repaid if at some time the railways can afford to pay some of it back. There should be provision for N.C.B. finance to be put on a solid basis in the interests not only of the industry but of the nation as a whole.

8.26 p.m.

Mr. Robert Cooke (Bristol, West)

I do not wish to detain the House for very long, because I know that other hon. Members, especially those opposite, wish to speak, but I should not like the House to pass from the Second Reading under the impression that there was a lack of interest on these benches in a subject which concerns many of us. The reason I wish to intervene this evening is that on the last occasion when we had a Bill dealing with the finances of the Coal Board I said that I could no longer support the pouring of public money down the bottomless pit of nationalised coal. Those were harsh words which, at that time, I judged to be valid and reasonable. Because on this occasion I want to support this Bill, which gives financial facilities to the Coal Board, I wish to say a few words about it now.

My experience of the coal industry does not, of course, compare with that of hon. Members opposite and some on my side of the House, although two of my grandparents, in their various ways, were concerned with coal. One lived in the Forest of Dean, in west Gloucestershire, not as a mine owner, but as one whose whole livelihood was affected by the prosperity or otherwise of the industry. My other grandfather, being a canny Scot, decided that he would invest such money as he made in the world of medicine in a company or some companies which he thought would bring him a fair return. He put a great part of his small fortune into Kent coal. I do not want to disparage the efforts of Kent coal, but I can tell the House that the efforts of my grandfather to invest in it were disastrous and that we in no way benefited; in fact, it was all lost.

I cite that because not by any means has everyone who invested in the industry gained extortionate profits from coal in the past. Nor is it reasonable to think that the National Coal Board should not pay interest on capital put into the industry in the days before nationalisation. I know that many people think that this is a millstone round the neck of the Board, but there were those who put their hard-earned and taxed re.sources into something which they thought would bring a return to them and their descendants and very few have done particularly well out of it.

Mr. J. Hill (Midlothian)

Does the hon. Member agree that had the pits still been under private enterprise those people who put their money into them, and who are still drawing interest from the industry, would have been drawing nothing?

Mr. Cooke

I cannot answer for a specific case, but, in general, there are some undertakings which, even if the pits were closed, would have had some value. The workings and the various assets might have been sold and the shareholders might have got something for their money. The value of land being what it is, there might have been some profit. But I cannot argue the particular case without the details, and this is not the place to argue it. I wanted to make the point that it is fair that some return should be given to these people who invested their money in days gone by.

Some hon. Members suggest that the uneconomic coal mines should be run as a social service, and this is where they and my hon. Friends obviously differ, because we do not feel that uneconomic affairs of any kind should be run as a social service. I do not think that the records of my hon. Friends and myself in this matter are such that it could be said that we have deliberately disregarded the interests of communities where there have been uneconomic pits, because we have done what we can to face up to the difficulties of changing circumstances.

I wished to intervene simply because when we last discussed this matter I said that I was unable to support the Government. I was one of six people who voted against the Government, and they included Viscount Hinchingbrooke, formerly the hon. Member for Dorset, South, who, unfortunately, is no longer with us. I wanted to make the point this evening that I see no objection to the Bill, which provides increased, helpful financial facilities for an industry which is more and more becoming a working concern—and no good Tory could be opposed to that kind of thing. I wish to support the Bill.

8.32 p.m.

Mr. William Warbey (Ashfield)

The hon. Member for Bristol, West (Mr. Robert Cooke) seems quite incapable of understanding that the conduct of great public industries and services, especially those which are contracting through economic circumstances, necessarily involves quite substantial social cost, which ought to be borne by the community and not by those people working in the industry or by a particular section of the community. That is the whole issue which lies between the two sides of the House in the debate.

The Bill is pathetic and inadequate. The best which can be said for it is that it probably does no harm, except that it rather tightens Treasury control over the short-term financing of the National Coal Board—and that seems to be its main intention, because it does nothing whatever to the borrowing powers of the Board. Under the 1951 Act, the Board already possesses powers to borrow up to £20 million for short-term financing, and the Bill does not add a single penny to the Board's borrowing powers. In other words, it makes no contribution whatever to the financial problems facing the Board, problems which have been created very largely through Government policy.

If the Government had intended seriously to tackle the financial problems, we could have had a Bill of very different character. We could have had a Bill which would have made a grant from public funds to the Coal Board of £70 million to repay the money lost on imports carried out as a result of Government orders and sold below cost as a result of Government orders. Such a Bill would also have included a further grant of £50 million to pay for the extra cost of over-stocking, again a result of Government policy, and the effort to abate the social consequences of that Government policy.

Thirdly, the Bill would have included a provision for writing off a substantial part of the capital value of the assets taken over at vesting day, most of which have exhausted their value or will have exhausted their value within a few years, and on which it is quite fantastic that the Board should be compelled to continue to pay high rates of compensation and interest.

If the Government had done something like that, then the Coal Board would have been in a position to pay its way on a diminished target output and would have been put into a position to face the kind of competition which the Government say that it will face in the coming year. We know that whether we go into the Common Market or not, as long as we have a Tory Government their policy will be to apply the rules of the Common Market, which are the rules of competition.

The rules of competition will require the Government to compel the Coal Board to import foreign coal and allow free imports of foreign oil and natural gas, regardless of its effect upon the mining industry. That is the prospect which the Board faces, and it is the reason why the Government, during the last twelve to eighteen months have suddenly tightened up their financial policy towards the Board. The social cost which the mining industry, the mining community as a whole and, indeed, large sections of the general public, not necessarily all of them belonging to the mining community, now have to suffer arises largely from the fact that the Government have in mid-stream changed their policy for the direction of the coal industry.

The policy now being applied is not the policy which was agreed with the Board a few years ago and reflected in the Revised Plan for Coal. The plan was based on a realistic assessment of the prospective demand for coal in the coming years. It was a plan for the orderly and socially planned contraction of the coal mining industry, very largely by natural and voluntary processes. If that policy had been carried out, as it was intended, by a slow, steady and orderly process, the contraction of the labour force in the industry would have come about purely by natural wastage and its relocation in the areas where it was most required would have been carried out also by the voluntary process of migration, instead of by the forced process of migration which is now taking place.

Eighteen months ago the Government changed their policy into one of forcing the pace of contraction and also forcing the pace of putting the Board into a position where it had to pay its way in competition with other sources of fuel and power. The Government deliberately speeded up the closing of mines. They introduced the policy that every mine must pay its way or go. That is the policy now being operated. The Board is being compelled to operate the policy at so accelerated a pace that it is unable to cope with the social problems now arising as a result of the Government's policy.

Hon. Members have spoken today about the social problems of the areas which coal miners are compelled to leave in order to go to other areas where there is work available for them in the mining industry. I want to say something about the social problems as they are seen at the receiving end. My constituency is in the heart of the East Midlands Division. Into this area are coming a number of men from Durham and elsewhere who have been forced by the Government's policy, whether they wanted to or not, to migrate to the East Midlands Division.

We know, and all the local miners and local folk know, that these men have been compelled to tear up their roots in their home towns, leave their friends and their community, and come to seek new homes and a new community life in a strange area. They come expecting to find a welcome into a community. They come expecting to find that they will have jobs comparable in reward with those on which they had previously been engaged and expecting that they will have somewhere decent to live for themselves and their families.

What is happening now? The conditions under which they could be welcomed into the local communities are not being satisfied. Conditions are being created in which it is impossible for the local community, including the local authorities which the Parliamentary Secretary was inclined to blame for any lack of progress with housing—

Mr. Peyton

No. I must interrupt the hon. Member to make it clear that I did not blame local authorities in general. I particularly singled out two or three local authorities which were being most helpful and I asked—and I think it a very justifiable request—that others which have proposals before them should treat those proposals most seriously and consider them with both humanity and urgency. The hon. Member is, therefore, not entitled to say that I criticised local authorities.

Mr. Warbey

The Parliamentary Secretary has repeated what he said before. In other words, he has accused some local authorities of lacking humanity.

Mr. Peyton indicated dissent.

Mr. Warbey

I am pointing out that the conditions are such that humanity is impossible. After all, have the Government given a guarantee to all local authorities that while they build houses to receive miners coming into their communities, they will also be able to build as many houses for local needs—and at the same subsidy? Unless the Government are prepared to give that guarantee they are facing local authorities with an impossible choice between the kind of people to receive humanity—humanity for the people in their own areas who have been waiting for years for homes but who cannot afford the high rents which local authorities are being increasingly compelled to charge, or for those coming in from outside.

What about the Coal Board itself? The Parliamentary Secretary said that it is also providing houses and that it has the power to do this. In my constituency there is a place called Meden Bank, near Stanton Hill. Meden Bank was an old colliery housing estate which was taken over by the Coal Board from the former colliery owner. The houses were in such a poor condition that the Board decided that it was not worth while to modernise them or even properly to maintain them.

As a result this part of Meden Bank degenerated into a derelict area. In appearance it became a slum, with the buildings half broken down, rotten or decaying, with broken windows and with the streets in an un-made condition with no pavements. Finally, the Board decided three years ago to clear the site and to re-house the people in it with the co-operation of the local authorities concerned. The local miners had to be re-housed and then a site had to be arranged for other purposes.

I visited this site last Saturday afternoon. Today, after three years, it is only two-thirds cleared. The remainder of the houses are now three-quarters broken down. Rats come in from the fields and four or five families are still living in these conditions and have not been re-housed. Last week Sutton-in-Ashfield District Council was told by the Coal Board that it required permission to use the site to provide caravans for the Durham miners who would be coming into the locality. The local authority, faced with an impossible situation—an emergency as it was told by the Board—had to agree to grant the licence although this was contrary to its general policy.

On this site, when it is eventually cleared, and on which might have been built, had there been proper planning and sufficient time to plan, good new houses for the men who would be coming from elsewhere, will be accommodated 32 caravans in which Durham miners, uprooted from their old homes, will be required to live with their wives and families. They will be required to eat and sleep, cook and live, all in virtually one room, with primitive sanitary and water supply facilities.

These are the conditions under which, as a result of Government policy towards the mining industry, British miners are being expected to live these days. It is a disgrace and it results directly from the policy pursued by the Government of forcing upon the Coal Board an acceleration of the cutting down of the mining industry and the closing of pits and the transfer of labour into other areas. Such an acceleration, carried out under the dictates of Government policy regardless of the social cost, causes such social consequences for the men who are moved and for the local community as will not be forgotten for many years to come.

8.49 p.m.

Mr. J. Hill (Midlothian)

I welcome the Bill, though I come from an area which has suffered in the past from the policy pursued by the Coal Board and an area which will suffer much more if the Board's plans are carried out. The plans are that 9,000 jobs will be lost in the Fife area in the next few months, and that in the same area and in other parts of Scotland in the next three years a further 24,000 jobs will be lost. The manpower in Scottish pits will be reduced from about 60,000 to about 40,000.

Those men were told that they would have to move if they wanted another job in the industry. The Parliamentary Secretary said this afternoon that, in conjunction with the local authorities, the Board intended to build houses for them. Is there any other industry that has to accept the financial responsibility of housing its employees? I do not know of any—perhaps the Minister will tell me. I warn those local authorities in England which the Minister is now asking to build these houses to watch their step, because Scottish local authorities were asked to do exactly the same thing—and what happened?

Glen Ochil is a name well known to the Board. The local authority built 900 houses for the miners who were to work there, but the Board suddenly changed its mind and closed the colliery. If those miners accept the Board's advice to go to England for jobs, the local authority will be left with those houses on its hands, and the financial responsibility for them. I therefore advise local authorities in England to get some security or guarantee from either the Board or the Government before embarking on this project, because the Government seem to have every intention of contracting the industry as much as possible.

In my constituency, they closed the shale industry, which also employed miners and, because of that, the coal pit that was supplying the shale industry, and employing 460 men, also had to be closed because the Board could not sell its product elsewhere. That was the first occasion on which Lord Robens, of whom we have heard so much this afternoon, said that if the bulk of those men wanted work in the industry they would need to go to England for a job.

The tragic thing is that coal is now being imported from England into Scotland. The Government have a big responsibility for that, too, because the announcement on prices made by the Minister of Power in December of last year has meant that Scottish industry has to pay anything from 10s. to £1 more than the price in England, so we can understand why Scottish industrialists are importing coal from England. But carrying coals to Newcastle cannot hold a candle to that.

Furthermore, when the B.M.C. factory came to Scotland, we were told repeatedly by the President of the Board of Trade, the Minister of Labour and the Secretary of State for Scotland that the firm would employ redundant miners, and that firms ancillary to B.M.C. would also employ redundant miners. But the build-up of B.M.C. has not worked out as was expected, and no ancillary firms have followed on.

It is true that in Scotland we have one ray of hope. A coal-fired electricity generator is being built at Cockenzie, in East Lothian. Here, I want to refer to the Mackenzie Report, paragraph 57 of which states: From the evidence before us, we see coal as a firm source of energy in Scotland lasting until well beyond the turn of the century, and that at least three times the present annual requirement for electricity purposes could be met during that period, provided there is early and continued collaboration between the two industries. For years we on this side have been advocating closer co-operation between the electricity generating industry and the coal industry, and I only hope that the Government will accept the Mackenzie's Committee's recommendation, and put it into operation before it is too late.

Another coal-burning electricity generator should be built in Scotland. The coal is there, and the Report says that …the availability of coal from Durham is problematical. What does that mean for Durham? More pits to be closed. Our concern is to avoid any more closures in Scotland. We have the coal, and we have the men to dig it.

Very often we have been twitted from the benches opposite about why we advocate keeping the pits open when so often we from this side have explained the hardships of the job. The answer is simple. We ask that the pits be kept open only until such time as we get the industries which, we have been told time and time again from the Government Front Bench, would come to Scotland. None of them has come yet. When those industries come, however, we will go further than the Minister and the Coal Board and we will say that the lot should be closed.

I know that I am due to finish about now, but there are occasions when our feelings get the better of us. I have been attached to the coal industry for many years and I know all the difficulties of the job. At the same time, I consider it far better that the Government, through the Ministry of Power, should make efforts to keep the pits open rather than pay the men unemployment benefit.

By the loss of these jobs if this policy is continued, the effect upon Scotland's economy will be tremendous. It does not end with the miners losing their jobs bat affects the people who supply the miners, from heavy industry down to the lightest industry. It would be to the Government's advantage, rather than to close the pits, to keep them open and do what they have been promising to do and what the Prime Minister said during the West Lothian by-election, when he said that he was concerned about Scotland and wanted to see it fully employed. Here is an opportunity for him to see that the miners keep their jobs until such time as the other industry which, we are told, is coming comes to take them up.

8.57 p.m.

Mr. William Blyton (Houghton-le-Spring)

My hon. Friend the Member for Hamilton (Mr. T. Fraser) opened the debate from this side of the House with an excellent speech about the industry in which both he and I have spent our lives. We have had good speeches from my right hon. and hon. Friends and I hope in the course of what I have to say to reinforce their arguments.

As is customary in coal debates, we have heard the usual speech from the hon. Member for Kidderminster (Mr. Nabarro). When Lord Robens reads the hon. Member's speech tomorrow, he will say, "Heaven save me from my new friend". The hon. Member claimed a great deal for Tories on a six months' balance sheet. He claimed that it was a victory for Tory policy, but he forgot to say that when the Labour Party left office in 1951, the accumulated deficit in the coal industry was only £5.6 million but that after eleven years of Tory administration in coal, it is now over £92 million.

I hope to deal later in my speech with the comments of the hon. Member for Stroud (Mr. Kershaw), who spoke about Europe. I can tell the hon. Member for Cardiff, North (Mr. Box), who had the experience of 3½ hours in a mine and enjoyed it, that we take an entirely different view, having spent thirty years working for small wages in the days that are gone.

This has been a wide debate. The Bill gives the Minister power to finance temporary revenue deficiencies. It enables the Treasury to guarantee temporary borrowing by the Board from sources other than the Minister and it changes the Board's financial year so that it runs from April to March. We on this side have no objection to the Bill, so we will support it.

The Bill has given us an opportunity to look at the industry generally as we see it today. How do we see the financial position of the coal industry? We see it as an industry that has had to carry unfair financial burdens for years. Some idea of the size of the burdens placed upon it as the result of policies pursued by the Government is gained from the fact that each year since nationalisation the industry has made an operating profit. This profit was £275 million by the end of 1961, yet this has been insufficient to meet the interest payments to the Minister of more than £345 million during the same period. The result is that the industry is £92 million "in the red".

No one can deny that up to 1957—this is proved in the Report of the Select Committee on Nationalised Industries—that the industry was run as a partial social service. The Select Committee showed how prices were kept down and increases often refused or delayed by Governments in the past. All this meant a loss to the Board. A further burden placed on the coal industry was the Coal Mining (Subsidence) Act and the tremendous loss on imported coal. During that period, whether we like it or not, the coal industry was subsidising private enterprise by selling imported coal at inland prices, and the loss was as I have stated.

During the same period, when British users of steel could not get steel in England, they had to pay a higher price if they bought it from the Continent. Another factor was that the industry was stopped from exporting coal when world prices were high. It could have made a great amount of money in those years, but it was forced to supply the inland market. I do not complain too much about that, as it would have meant that full employment would have been jeopardised, but it is just as well to remember that if the Board had operated the laws of private enterprise it would have sold in a sellers' market with better financial results.

When our economy was stagnant, a few years ago—it is still stagnant, for that matter—the Board had to stock coal at a high cost which maintained employment for the men. It could easily have closed pits, as was done in the 1930s, and the Government would have had to pay huge unemployment benefits. The economic consequences of keeping the pits open was a burden on the Board, resulting in a heavy charge on the industry. The least that we can say about other countries in Europe at that time is that they helped financially their coal industries to stock coal, while again our Government did nothing.

We have to consider another factor when we talk about this industry and make due allowance for it. This was the planning of the industry and the investment necessary to support such planning which was based on the Government's estimate and forecast that the demand for coal would reach 240 million tons in 1965. Unfortunately, in the absence of a national fuel policy, circumstances arose in which the industry was forced to contract to bring production into line with demand. This extra capital which the Board was forced to invest in the industry on the Government's estimate is now having to be carried in the industry by smaller production. This alone justifies a large reconstruction of the industry's capital.

The industry itself is not unmindful of its responsibilities to supply coal at prices which seemed best for the public interest. It has loyally accepted this obligation, but it is a pity that this cannot be said for industrial consumers who, having reaped benefit as a consequence of the Government policy of depressing prices for the first ten years of nationalised mining, are now willing to turn their backs on British coal so that they might increase their already substantial profit making potential.

Therefore, looking at the Board's finances and taking all these factors into consideration, it is time the Government went to the aid of the Board and helped it as it has helped in cotton, railways, agriculture and many other industries. I have emphasised these points because there are many who have very short memories, especially the steel owners and the industrial consumers.

These people should remember that, had the Board enjoyed the same freedom of choice as they claim for themselves in their own commercial transactions, it would have made substantial profits in the export market when prices there were far in excess of the inland price, and that the tragedy of the present position of the Board's finances is that, having been treated as a partial public service for the last ten years, it is now expected to act overnight as a commercial concern.

Our position is clear. We believe that there can be no realistic plan in industry unless there is a policy of economic expansion and full employment and the responsibility for this rests clearly on the Government. Such a policy is necessary to accommodate the technological changes that take place. The Government should stimulate production in other basic industries, and their duty is to maintain full employment.

I do not apologise for coming back to the question of a national fuel policy in place of the free-for-all in which the Government believe. The Government should assess each year our annual fuel requirements, in a plan which would allow coal a share commensurate with its position as a valuable national asset and to be under-written by the Government. Within such a policy, the share of the other national fuel industries would also be determined, with co- ordination of and consultation between nationalised industries.

The Government should also face the question of the distribution of industry to meet the needs of the contracting coalfields, and there should be controls and inducements to mitigate the effects of this contraction, with the restriction of recruitment to provide employment in the mining communities. Planning ought to be carried out to ensure that before pits are closed alternative employment should either be found within the industry or in other industries brought in to replace mining. I know that the Minister is dead against a fuel policy for Britain, but I also know that he is prepared to accept the policy of the European Economic Community, about which I will say something later.

What are the Government to do to bring employment to areas where pits are closed for economic reasons, or because of contracted output, or because the coal is exhausted? No doubt we will be told, as we have been told before, that in certain counties there are thousands of jobs in the pipeline. In Durham, we have never seen the pipeline, never mind the jobs which are in it. It is more like a pipe dream than a pipeline. In areas like Durham unemployment has grown and there is great anxiety in many of the coalfields. Is the Coal Board contracting the industry too quickly? I believe that it is. I recognise that it is not responsible for the social aspects of the policy, but the Government certainly are.

If it is Government policy that all uneconomic units must go—and apparently it is their policy to equate production with demand—then they must plan to meet the social consequences which arise, and they have not done so yet. I admit at once that the Coal Board and the unions have done all that they could in the circumstances to place men in other jobs and to find lodgings for them in receiving areas, and so on. Men and their families have had to be uprooted from areas in which they have spent many years and have often been unable to get houses in new areas, in which they have had to make new associations.

There has been migration from Scotland, Durham and other areas, and there is bound to come a time—and I say this advisedly—when there will have been so many closures that the receiving areas will be full. In view of that development, will the Government do anything to meet the situation? There is nothing that any of us can do and once again people are facing anxiety which we thought had gone when the Labour Party won power in 1945.

In my county, as in Scotland and other areas, we are faced with the migration of population. There is a way that the Government can help. My hon. Friend the Member for Durham (Mr. Grey) and my hon. Friend the Member for Hamilton spoke about the building of electricity generating stations. The most effective way to help Durham is to build a power station, if necessary to export electricity until such time as it can be used locally. A power station of 2,000 megawatt capacity and using 5 million tons of coal a year would guarantee the jobs of 10,000 miners. Migration would cease, for not only the 10,000 miners, but their families and shopkeepers and others who indirectly depend on the wages of miners, would benefit.

The cost of a generating station would be negligible compared with the social cost of doing nothing. My colleagues and I have met the Minister, but he told us that the price of coal in Durham was uneconomic while production in Yorkshire and the Midlands was economic. This is hotly disputed in Durham, and the Minister should ensure that generating stations are set up near contracting coal fields to help offset the problems created by the Government's policy of hiving off uneconomic pits.

Two classes of people are hit when mines are closed. First, there is the light-rate compensation man. This is the man who can do only light work suitable to his disability from injuries received while following his employment. The other type is the man who suffers from the deadly disease of pneumoconiosis. When a pit is closed, men who are doing light work cannot get jobs at the receiving pits because at those pits there are men suffering from like disabilities and are therefore in those jobs.

Again, what is to be done with the men who, after many years of loyal service in the industry, find themselves, at the age of 55, in the position of not being able to find alternative work? I know that I shall be told by the Minister that such men will get redundancy pay. We are all glad of that because it is a great help, but it is a little hard on a man of 55 to get redundancy pay and find himself written off in the labour market.

How are we to train these men, and, if we do, will there be employment for them? Will new industries be brought in to give these men a chance to find employment? Are these men who have served in the industry all their lives to be left on the scrapheap in the mining villages after the pits are closed and given no help? We urge on the Government that it is their duty to do something in this matter.

There is another problem which arises from the Tory Party policy of hiving off uneconomic units in areas like ours. How are we to provide employment in our mining villages for the children leaving school if the pits have been closed? This is a serious problem for us in all areas where the industry is contracting. Although the Government have known for many years about the problem of the bulge, no planning has been undertaken to absorb our young people who are now leaving elementary schools. The bulge will be with us for several years, and will create great problems not only in the areas where pits have been closed, but in the development districts. The Board's policy of controlled recruitment and the retirement of men at 65 has been helpful in retaining our manpower reduced as it has been by mechanisation and closures—but it has reduced the number of jobs available for the boys who are leaving school.

It is estimated that in my county 20 pits will close during the next five years, and that our manpower will drop from 82,000 to about 50,000 by 1967. The worst effects of this will be felt in the west of the county. Unless something is done, and done very quickly, I am afraid that we will face another 1930.

I want to deal with another feature of the coal industry. Recently, there have been reports that the Gas Council is showing great interest in the deposits of natural gas in Northern Holland. When we opposed the policy of importing natural gas from the Sahara we said that it was the beginning of a policy which would be detrimental to the coal industry. We were told that this was not so.

I ask the Minister directly: is the Gas Council again going to bring in natural gas from Holland? The Sahara gas project that the Minister sanctioned represents 10 per cent. of Britain's total gas consumption. Its effect will be felt in the Durham coalfields in about two years' time. If imports from Holland are contemplated on the same scale it will have a serious effect not only on the coal industry but on our balance of payments.

The effect will be most serious for those gas coal producing areas which are already contracting. The gas industry seems rapidly to be moving towards the use of feedstocks which require foreign exchange and will produce gas without leaving coke as a by-product. The Minister himself knows that the gas industry is expected, in the years ahead, to provide the major portion of solid smokeless fuels required for the smokeless zones. Will it be authorised to do this, as well as to bring in gas from Holland, thereby injuring our own coal industry?

I now turn to the question of the Government's application to join the Common Market, and to ask what are the Government's intentions. Everyone knows my views on the subject. I will not argue the case for or against tonight. I simply wish to obtain information from the Government so that we may know where we are travelling in relation to this important problem. I ask what is involved in the six questions mentioned in paragraph 5 of Cmnd. 1838—The United Kingdom and the European Communities—which was issued in October.

Sub-paragraph (a) states that during the course of the negotiations it will be necessary to determine the question of Any changes in United Kingdom practices and policies which may be required to enable the United Kingdom to observe the rules of the Treaty of Paris on prices, and the provisions about transport associated with them, including the problem of maritime freights. Does this mean that our price structure must go? Under Article 61 of the Treaty the High Authority can fix maximum and minimum prices. What effect will this have on our finances? Further, will the price structure be a national one or will there be district prices? I should like some enlightenment about the meaning of sub-paragraph (a)?

Can we be told what we have to give up to meet the requirements of the Treaty of Paris on prices? What is to happen to import prices of coal from third countries? Will the Government oppose this provision, because of the danger of price alignment? Under the Treaty the Six will be entitled Ito export to us. Today, those exports are controlled, but they will not be if we join. I know that the Coal Board would wish any possible imports to be under its control. Do the Government support this view? It will be contrary to the Treaty.

What about oil? Under the Treaty the Six must publish prices and practise non-discrimination in the coal industry, but there is no regulation relating to prices and sales policy in the oil industry. Do the Government intend that the oil industry should be subject to the same provisions as apply to the coal industry?

How are we to obtain an export market in Europe? Are we going to sell at a loss in order to do so? We must remember that in Durham last year and this year the price was too low, and that one cause of our deficiency was the loss on export coal. Are we to sell at a loss, and make it up on our inland prices? Then, we are told that we can capture the generating stations on the European seaboard and that a big market lies there. I ask the Minister whether this can happen. The Generating Board in England argues that it is no cheaper in the Thames Estuary to fire on oil, because of the costly haul of coal from the coalfields. Will this not apply to the European seaboard, because we shall have a long haul in order to ship our coal there?

Let us now take paragraph 5 (d) of the Command Paper, which talks about the "exceptional control" over the British coal industry by the Coal Board, and says that the Treaty does not prejudice this system of ownership. I ask the Minister whether this involves scrapping of our sales organisation in the Coal Board. In the light of the High Court decision in the case of Belgium and Germany, in which it was ruled that to set up a sales organisation was incompatible with the rules of competition, this makes me really apprehensive. In that High Court ruling on this matter, it was stated that the organisation suggested was too big and was incompatible with the rules of competition. In the light of this decision, will our sales organisation, both in coal and steel, remain as it is?

Further, what is meant in the Command Paper by the questions we have to answer about the Coal Board's "exceptional control over the industry"? Does it mean that we must accept that the Coal Board will no longer enjoy the power it now has on prices, agreements, concentration, transport rates on coal and commercial policy? Does it mean that the powers held under Chapter 5 of the Paris Treaty, where a decision made cannot be upset by an elected Government, gives them control over our coal and steel? Does it mean that we can have district competition here internally with an overall national committee, and that nationalisation, as we now know it is to be radically altered to suit the rules of the Paris Treaty?

These are some of the questions that have bothered me ever since I got this Report, and all I want to say, in conclusion, is that at the end of 1970, if we join the Common Market, we shall face a common coal policy known as the "Document on Synthesis" While I do not want to go into all the pros and cons of it at this late hour, I would point out that it states specifically that there will be a "free-for-all" in 1970, that discriminatory taxes on fuel will be abolished, that it will be "every man for himself when Jack's overboard", and that in the coal industry of the Six, or the Seven if we are in it, coal production will be halved by 1970 under the fuel plan.

So I say to the Minister that if we have contracted this industry by 1965 to a manpower figure of 500,000, and if we join the Common Market, we will then see the mining community of this country—when coal production is halved by 1970, as this document forecasts—facing another period of agonising reappraisal of our industry. I have always believed in public ownership, especially of coal and steel, as an instrument which the Government could use in economic planning, and it is essential to have the freedom to use it without being tied up by rules which could determine whether or not the instrument which we have created can be put into operation. From my studies of the Document on Synthesis, I am confident that we shall again face difficulties at the end of the transitional period, and I ask the Minister to throw some light on these problems before we irrevocably tie ourselves to commitments which will last for forty years.

9.30 p.m.

The Minister of Power (Mr. Richard Wood)

I wish to begin by thanking the hon. Member for South Ayrshire (Mr. Emrys Hughes) for the kind things he said about my hon. Friend the Member for Glasgow, Pollok (Mr. George). I, and my hon. Friend the Parliamentary Secretary, miss the great experience and wisdom of my hon. Friend the Member for Pollok. His absence, and the lack of that advice which he could always give, increases for me the value of such debates as this when I can obtain advice from the hon. Member for South Ayrshire and from other hon. Members.

In the last five hours the Bill which we are discussing today has received rather scant attention and if I were a proud parent I might have been rather hurt about that. I have heard it mentioned on five occasions only and it has been discussed at any length by only one right hon. Gentleman opposite, the right hon. Member for Easington (Mr. Shinwell). Even with his experience of my office I do not think that the right hon. Gentleman entirely apprehended the purpose of the Bill. While it is a necessary Measure I am not particularly hurt that it has not had more attention. I do not think that any of us would claim that it is the kind of bedside reading which we would prefer. It is no simpler than any financial Measure ever is, and though I may claim a fairly firm grasp of its two provisions I prefer—I am sure that hon. Members will agree with me—to rest on the pellucid explanation which we have already had from my hon. Friend the Parliamentary Secretary.

Mr. Nabarro

Pellucid—what is that?

Mr. Wood

Very clear.

Instead of concentrating on the Bill, hon. Members who have taken part in the debate have ranged widely and discussed the future not only of the gas industry but our vast investment in the oil industry. There has also been a survey of the future in Europe and the United States. Apart from these glances into the future we have had from hon. Gentlemen opposite, as I expected or suspected that we might have, some nostalgic peeps at the past.

In my opinion some hon. Members opposite have exhibited what seemed to me rather disturbing signs of chronic schizophrenia. After listening to one or two of the speeches I could not make out whether hon. Members opposite would like to see more men or fewer men employed in the pits. In some speeches I heard both views expressed. I find it difficult to understand whether these hon. Members would like to aim—as would the Government—at the Coal Board making a profit, after the necessary reorganisation of the industry, or whether they would be content if the Coal Board made a loss through keeping open uneconomic pits. And not only uneconomic pits. Some hon. Members appeared to be asking that even exhausted pits should be kept open. They pointed out the social problems which arose following the closing of any pit.

It has been argued that a larger part of the market should he guaranteed for coal. My difficulty is that were a larger part of the market so guaranteed and the coal sold less competitively than otherwise would be the case, I cannot see what benefit that would bring to industry as a whole. It is very important both from the point of view of hon. Members opposite and my hon. Friends, that industry as a whole should be benefited as much as possible.

The hon. Member for Hammersmith, North (Mr. Tomney), who I do not think is now in the Chamber, asked what I thought was the optimum number of men for the industry.

Mr. Nabarro

I gave him the answer.

Mr. Wood

My hon. Friend the Member for Kidderminster had a go, but I shall give my own answer. It is the same kind of question as what is the optimum size of my living room? It depends on a number of things such as the amount of furniture, the number of people using the room and the cost of its heating. All such things have to be taken into consideration, just as many things have to be taken into consideration in deciding the optimum number of men in the industry. Such things as the demand for coal, its price and, above all, the particular methods of winning the coal will all have a considerable effect on the number of men employed. My hon. Friend the Member for Kidderminster had a go by mentioning 500,000 men. If manless faces or manless pits come about in the future, we might be able to do with fewer men.

Mr. A. Roberts

Provided there is no unemployment in the mining areas. A man prefers to work in the pit to being unemployed.

Mr. Wood

I am coming to that. It is part of the Government's policy to try to bring new employment to areas where coal mining is declining. The right hon. Member for Easington asked about employment in the pits in 1960 and 1962. The figure are: in 1960, 602,000; and in 1962, 540,000. That is 62,000 less than two years ago. If it is suggested that that means that jobs are not available for those 62,000 the right hon. Member will know, as I do, that it is very wide of the truth because unemployment in the mining industry is sustained—due to the policies of the Coal Board and its ability to re-employ miners displaced from other pits—constantly below the national average.

The debate has rightly devoted considerable attention to men now in the industry, their problems and their security. I wish to join with hon. Members who have expressed congratulations to the Board for what I believe has been one of its greatest successes. Over the last few years, not only in 1960 but further back, the run-down in manpower which we have discussed earlier has been something like 160,000 men. I do not want to avoid any of the awkward questions put to me from time to time. I do not think anyone could complain that the direct unemployment caused by that run-down has been significant. Admittedly it means a decline in the number of jobs available and that is very important. It also means other important things; as the hon. Member for Houghton-le-Spring (Mr. Blyton) pointed out, serious difficulties for the disabled and older men and a decline of opportunities for boys leaving school. All that is important, but unemployment caused by pit closures has been negligible, very largely owing to the Board's policy.

I am very well aware of the problems which no doubt will exist in future, particularly in Scotland, and the rather different problems—but still problems—of redevelopment and re-employment in the North-East, including the county from which the hon. Member for Houghton-le-Spring comes, and also the different problems in South Wales. In the next few years I think we shall see a great deal of movement in the industry. I am quite sure that only through movement to the industry's new and reconstructed pits can the men who remain employed in the industry achieve the security they want.

I certainly recognise that transfers from one pit to another may in many cases lead to some initial loss of earnings, and I certainly realise the problems of promotion to the face for men who are transferred—difficult problems both for the National Coal Board and for the unions. But I am certain that in the long run there can be no doubt that a miner will earn more in a pit which has a high output and a high productivity than by remaining in a colliery which is struggling for its life.

Mr. Mason

The problem in the mining industry is not that of output per man-shift and things like that. Because of investment, modernisation and mechanisation, that is gradually being solved. The problem now is that in an area, two pits each employing 1,500 men—a total of 3,000—may close, and there may be 200 or 300 of those men above the age of 55, as well as those who are industrially injured or suffering from such industrial diseases as silicosis and pneumoconiosis. These men cannot move and cannot get other employment. It is therefore incumbent upon the Board, the Ministry of Power and the President of the Board of Trade to do something positive about that problem arising in the closure of collieries, and the Minister ought to be addressing himself to that problem now.

Mr. Wood

I ought not to be doing it now, because in the order in which I am speaking I shall be doing that in about three minutes. I shall then address myself to the problem. Clearly it is an important one. The only answer to the problem of the disabled miner is the provision of new employment in areas which are declining.

Before I deal with that issue, I want to turn to a point raised by my hon. Friend the Member for Aberdeenshire, West (Mr. Hendry) and the hon. Member for Midlothian (Mr. J. Hill). This is the problem of differential prices, particularly in Scotland and, as hon. Members will recall, in other areas of the country. The Coal Board decided at the end of last year or early this year—this was no new decision but a decision of some years' standing—that prices should reflect much more closely than they had done previously differences in the cost of production. My hon. Friend rightly drew my attention to the paper-makers in his constituency. The hon. Member for Motherwell (Mr. Lawson) has previously drawn my attention to the steel-makers in his constituency. Both those industries were admittedly adversely affected by this differential increase, but the important point is that it is not only those two industries which have to make both ends meet; the coal industry must make both ends meet, too.

We must remember that the Scottish deficit has been of a different order from all the other deficits in all other divisions. It has been much larger since nationalisation than the whole national deficit put together. The chairman of the National Coal Board was, therefore, left with alternative remedies. One was to increase prices generally and so reduce the competitive power of all the Board's most economic production. The second was that there should be Scottish and other local increases in order to reflect some of the extra cost in those areas of producing the coal.

The Board felt, and I agreed, that another general increase all over Great Britain would strike at the heart of the industry and would reduce very considerably its powers to compete with its competitors. Frankly, I think that I can claim that the wisdom of the choice Which the Coal Board made, and which I approved, is already being reflected in this year's improved results.

I want to come directly to Scotland and to say something about closures, because I know of the great anxiety which they cause hon. Members, which has been expressed frequently this afternoon. Scotland is one of two areas, the other being that of the hon. Member for Houghton-le-Spring, which will be hardest hit by closures. We have a picture of the problem in the review which the Board carried out. Of 106 pits in Scotland 27 must in any case be closed because of exhaustion and 46 have adequate reserves and are profitable to work. In between those two figures of 27 and 46 there are 33 pits in the middle category—those which have so far been unprofitable. Obviously how many of these have to close will depend on the demand for coal and on the success of the Board's present efforts to make the industry more efficient and up to date.

There will be a number of closures which cannot be avoided. I can assure the House, although I think that it already knows, that the Board does and will do all it can to find other jobs in industry for the men who are displaced. By the end of this year there will have been closures in Scotland involving as many as 7,000 men, many of them unfortunately affected by the tragic accident at Barony pit, to which my hon. Friend the Parliamentary Secretary referred at the beginning of the debate. The Board hopes to offer employment to nearly all of them inside the industry. For next year the Board has already been discussing with the unions possible closures involving something over 2,500 men, but again most of them should be offered alternative jobs in industry.

I come to the point made by the hon. Member for Hamilton (Mr. T. Fraser) about the obligations of the Government. The Government clearly have obligations in this matter. We are aware of those obligations. We have carried through the House the Local Employment Act, and we are well aware of the danger and the undesirability of the population build-up in the south-east corner of England. That is very much in our minds. We are determined to increase the attractive power—I speak in an industrial sense—of Scotland, the North-East and the other areas which are losing population. I do not think that hon. Members do those areas any good by moaning about impending dereliction. If they look at the example in South Wales, they will no doubt agree that there has been a veritable transformation in that area because it got a good start and because industry followed. There is no reason at all why, taking the longer view—admittedly it will take time; it cannot be done in a year—we should not see a similar change in Merseyside, where a great deal of industry is already going, and in Scotland.

I am absolutely with the wish of hon. Gentlemen that more should be done, but I refute entirely their suggestion that the Government are merely sitting supinely by and not caring about the situation. I have seen the efforts, and the success of the efforts, which my right hon. Friends the President of the Board of Trade and the Minister of Labour are making. They are making efforts, and successful efforts—for instance, the coming of the motor industry to Scotland and many other important developmnets—to do exactly what hon. Members want to happen. The Government are accepting their responsibility, not only in trying to persuade industry in the normal way to go and settle in Scotland and other places which need industry rather than settling in other places, but also by building a large number of advance factories. Hon. Gentlemen will know about the advance factories planned in Scotland in areas of threatened local unemployment—Shotts, Cowdenbeath, Cumnock, Sanquhar and Donibristle, and similarly in the North-East other advance factories are being built. I do not think it can possibly be argued that the Government are taking an indifferent view of this and are not acting as energetically as they possibily can.

The hon. Member for Durham (Mr. Grey) made the point about the power station in Durham being not only a helpful employment in itself but also a helpful provider of employment to a number of thousands of Durham miners. I should like to correct him because he suggested that I had given an answer, both in the House of Comomns and privately—to him and to some of his hon. Friends—to the effect that there would not ever be a power station in Durham. That is not what I said. My answer to the hon. Member for Chester-le-Street (Mr. Pentland) in May of last year was to the effect that the choice was for the Generating Board, which was already building a power station at Blyth, but that there were no immediate plans for a new power station in Northumberland and Durham.

Suggestions have been made that the industry's problems in Durham could not be solved unless a new power station was started there. I met a deputation of hon. Members from Durham constituencies in the summer and I am now arranging—and the hon. Member for Chester-le-Street recently wrote to me about this—to meet them again with my hon. Friends from the Ministry of Labour or the Board of Trade.

Mr. Shinwell

I hope it will be more successful.

Mr. Wood

In considering this question of a Durham power station the Government will certainly take into account the points made in this debate and any new ones which the right hon. Gentleman or his hon. Friends may develop in the course of the forthcoming meeting.

Mr. Shinwell

I would remind the right hon. Gentleman that the chairman of the North-Eastern Division of the Coal Board has himself strongly urged on the Government and the Electricity Authority that they should proceed expeditiously.

Mr. Wood

I have discussed the matter with the chairman of the Coal Board.

Let me come now to the great question of coal against oil which has, naturally, figured largely in the debate. The Government are criticised, on the one hand, for giving coal too little assistance during the period of adjustment and, on the other, for pursuing a protectionist policy which has led to high fuel costs to the detriment of the economy. I follow the principle that if one is in the middle of fire which is coming from both sides one is probably in the right position—and that has been my position since I arrived at the Ministry of Power.

Mr. Nabarro

A horrible argument.

Mr. Wood

I am sorry that my hon. Friend the Member for Kidderminster considers it to be so. I thought it would have appealed to his sense of toleration and fairness. I have tried to pursue a course since I arrived at the Ministry midway between reliance on indigenous fuel, even when it is uneconomic and I hope that the hon. Member for Kidderminster will approve that side of it—and—what I hope my hon. Friend will also approve—the avoidance of over-dependence on imports.

Mr. Nabarro

I do not approve of Her Majesty's Government placing a duty on fuel oil as a protectionist measure for coal. That is thoroughly bad.

Mr. Wood

I do not think that I could possibly discuss that with only seven minutes remaining for me to complete my speech.

I now refer to a striking phrase which the hon. Member for Durham used about imports of oil. He used the words "the placing of foreign fingers around Britain's economic windpipe". That is a good phrase but I do not agree with the metaphor and I should like to argue the matter with him on another occasion. However, these foreign fingers are not quite as important as he suggested, because I made inquiries about refinery output and the net import-export position. I found that this year the refinery output has been at record levels and the result is that after eight months of this year refinery production has more than matched inland deliveries and also that during the year we have been net exporters in the sense that exports of oil plus bunkers have exceeded imports.

Therefore, it is not correct to say that we are net importers. It is important to remember that if we are to exist at all in this country we need a great deal of oil for transport, aviation, agriculture and so on. As long as we are importing less than we are exporting, so that our net exports are greater, there is nothing wrong in that situation, and we would not be over-dependent on supplies for abroad.

There is one further point I want to make in reply to the hon. Member for Hamilton and that is on the question of the dual-fired station in the south of England. I approved the station, which is not one of 4,000 megawatt but of 1,000 megawatt, on the Medway. I am aware that the Central Electricity Generating Board has a choice of providing electricity in one of five ways—either a nuclear-powered station, an oil-fired station, a coal-fired station, a dual-fired station or a power station, built further up in the north and transmitting electricity down to the south. It is clear that a nuclear station is not applicable everywhere, and a coal-fired station is not economic, for instance, on Southampton Water.

A dual-fired station may be wise rather than an oil-fired station because it may be, as in this case, that both coal and oil are quite well placed to get there economically. It may be that in this station, which will not come into production until 1968, coal will be competitive, but it is difficult, six years ahead, to say whether at that time coal will be competitive with the oil that might go into the station. Therefore, I think that the Central Electricity Generating Board is right to build a dual-fired station in that area which might be fired economically by either coal or oil.

I should also like to say a few words in reply to questions asked about the possible entry into the E.C.S.C. The Lord Privy Seal has told the Six that Her Majesty's Government are prepared to subscribe fully to the principles and objectives of the Treaty of Paris. The precise way in which the necessary arrangements will be implemented has still to be worked out. As yet there has been no discussion of the question of a financial contribution from Britain if it enters the Community. The admission of imports from outside Europe is under the terms of the Treaty a matter for individual Governments, but the Coal Board hopes to increase sales by improving efficiency, including the reduction of costs involved in loading and shipping. I was also asked how the Board's control could be said to be exceptional. The Six have suggested that the Board is exceptional in that it has no counterpart in any of the existing Community countries. That is what I think "exceptional" means, and we have replied that we do not believe that the organisation of the Board is in any way incompatible with the Treaty.

Mr. Mason rose——

Mr. Wood

I am sorry, I cannot give way now.

I think that the Coal Board under the energetic and inspired leadership of Lord Robens is trying to build what will amount in a few years' time to a new industry. It is true that demand has been lower than before, but it is also true that the Board under Lord Robens is putting continual pressure downwards on costs in order to meet its objective. Some hon. Members have spoken with a certainty of gloom in the debate. I never speak in debate with either certainty of gloom or of brightness ahead. I am quite well aware that there is little certainty in this life and I have seen in my short time too many confident forecasts fade into oblivion to want to make any more.

I am sure, however, that the energy of reseandhers in coal, the willingness of the whole industry to develop new ideas and methods, the energy of sellers of coal, the vigour of leadership and, basic and indispensable, the industry and adaptability of those employed in coal mining will not be the weak links in the chain. I hope, therefore, that if the House gives the Bill a Second Reading, as I am sure it will, it will also have expressed a message of encouragement and confidence in the Coal Board to continue in the years ahead.

Question put and agreed to.

Bill accordingly read a Second time.

Bill committed to a Standing Committee pursuant to Standing Order No. 38 (Committal of Bills).