Price Increases

HC Deb 26 April 1966 vol 727 cc516-8

4. Sir G. Nabarro

asked the Minister of Power what consultations took place between the Chairman of the National Coal Board and himself concerning the coal price increases recently announced, having regard to their discriminatory effect.

16. Mr. Monro

asked the Minister of Power what consultations he had with the Chairman of the National Coal Board before the recent price increases of coal in Scotland.

Mr. Marsh

Both the Government and the Board believe it is desirable to secure a better correlation between the prices and costs of the various coalfields and the various coals, and this policy was supported by the National Board for Prices and Incomes in its recent Report on coal prices. My predecessor was in close touch with the Chairman of the National Coal Board when the price increases were under consideration.

Sir G. Nabarro

What influence will this substantial price increase have on the cost of living index measured during the next six months?

Mr. Marsh

I would require notice to answer that question.

Mr. William Hamilton

Does my right hon. Friend think that this discriminatory price increase in so far as it relates to Scotland will have the effect of expediting pit closures still further? If that is the case, what remedial steps are the Government taking by introducing and encouraging an influx of new industry into the areas?

Mr. Marsh

The first thing to bear in mind as to this policy is that the one thing which would damage the coal mining industry in general, not to say British industry as well, would be a situation where low-cost highly efficient coalfields were forced to average up to meet the costs incurred by perhaps less efficient coalfields. I do not think that this price increase will have a detrimental effect on the Scottish economy. Indeed, the Government would not support it if they thought it would.

Mr. Monro

Is the Minister aware that this increase in prices will make it much more difficult to attract coal-consuming industries to Scotland?

Mr. Marsh

The estimated additional total industrial cost should be under half of 1 per cent. Given the rest of the Government's policies, I do not think this will have a bad effect on the Scottish economy.

Sir W. Bromley-Davenport

Is not this another example of the failure of nationalised industry—worse quality and worse service at increased cost?

Mr. Marsh

The hon. and gallant Gentleman is consistent in his inability to understand the point. This has nothing to do with the efficiency or inefficiency of nationalised industry.

10. Mr. Edward M. Taylor

asked the Minister of Power to what extent the pithead price of coal provided to domestic consumers by the Scottish Coal Board will differ from the average price charged in other areas when the price is raised on 1st May; and by what percentage the Scottish price exceeds the lowest figure for a comparable grade of coal supplied in other areas of Great Britain.

Mr. Marsh

The National Coal Board sell domestic coal not at pithead prices but at zone delivered prices, which include cost of transport from pithead to station depots. There are 60 zones, with different prices, in Great Britain. Domestic coal is grouped according to qualities, and there are five groups in England and Wales and seven in Scotland. In view of these complications, I have asked the Chairman of the National Coal Board to send the hon. Member a copy of the list of the prices which will come into effect on 1st May.

Mr. Taylor

Does the right hon. Gentleman not appreciate that I raised this question in the last Parliament and that the same answer was given? Is he seriously saying that the Prices and Incomes Board and the Ministry approved these staggering increases in Scotland without knowing what were the prices involved?

Mr. Marsh

The hon. Gentleman first of all asks to what extent the pithead price of coal provided to domestic consumers by the Scottish Coal Boad will differ from the average price in other areas. Domestic coal is not sold at pithead prices. It is sold at zone delivered prices. In any case, when one takes the zone delivered prices the complications are such that if the hon. Gentleman gets the figures together—and they will be sent to him by the Chairman of the National Coal Board—he will be able to work them out for himself.