§ Order for Second Reading read.
§ 3.52 p.m.
§ The Minister of Technology (Mr. Anthony Wedgwood Benn)
I beg to move, That the Bill be now read a Second time.
This is an important Bill, though fortunately it is also short and uncomplicated and will, I hope be uncontroversial because, essentially, it is a sequel to the Coal Industry Act, 1967. With some modifications, it will extend for a further period of three years the powers of that Act which otherwise would have expired in March next year. This is the main purpose of the Bill. It will establish part of the framework within which one of our key industries will make its plans and conduct its affairs in the early 1970s.
The Bill has purposely been brought before the House well before the expiry of the existing support measures in order to give the National Coal Board a firm foundation for its forward planning. The industry must know where it stands and, for a reasonable period ahead, what help can be looked for from the Government. The House may recall that in its 1967–68 Report on Natural Gas the Select Committee on Nationalised Industries specifically and rightly recommended that the measures of assistance for coal after 1971 should be settled in good time.
Coal is a key industry. The contraction of recent years—the pit closures, the manpower rundown—and our growing use of the newer fuels may have led some people into thinking that coal no longer counted for much. Nothing could be further from the truth.
The coal industry is a vast enterprise, providing employment for over 350,000 people, with a capital value of £750 million and a turnover of over £800 million. It provides, at no cost to the balance of payments, about half of the nation's primary fuel requirements although, of course, as other fuels come in, that proportion will tend to reduce.
Coal remains indispensable, and the basic objective of the Government must be to maintain the conditions in which 761 an efficient coal industry can continue to make its essential contribution to the nation's fuel needs. Our power stations, our steelworks and innumerable industrial and domestic consumers will need coal in very large quantities for as far ahead as can be foreseen.
It is the task of the Government, through their fuel policy, to provide the conditions in which the coal industry can make its own future secure. It is the task of the industry—and this is the difference between the two tasks—to turn the opportunities offered to it into reality. Given the active encouragement and support of the Government, the mining community can deliver the coal. This is an industry with a fine record of industrial relations, with a labour force second to none in spirit, determination and skill. Britain has come to rely on the unstinted co-operation of the miners, the N.U.M. and N.A.C.O.D.S. in the drive for greater efficiency, and it has been an example to us all.
Therefore, I think the House will agree that the industry must be fairly—indeed generously—treated, and I believe that it has been so treated by this Government. We intend to continue to do so. We shall watch the situation and do what is necessary within our power to maintain a fair framework within which the coal industry itself can operate; at the same time seeing to it that the nation is adequately and securely fuelled—which is the Government's and my Department's main responsibility.
Fuel policy must mean fitting the activities of the individual industries into a wider pattern designed to ensure that our fuel requirements are met at the lowest total cost to the community. But we have also to be concerned, and we are concerned, with the social and regional effects of change. One of the Government's main aims has been, and remains, to ensure that coal shall have its rightful place in the general structure. The measures designed to achieve this aim, which are known to the House, include:
Within this fuel policy the principal objectives set for coal were and are: (i) to concentrate production on the low-cost pits; (ii) to press ahead with modernisation; (iii) to keep supply and demand in balance; and (iv) to ease the social effects of contraction.
- 1. the heavy oil duty;
- 2. the virtual ban on coal imports;
- 3. the restriction on the conversion of coal-fired power stations to other fuels;
- 4. restraint in the working of opencast coal;
- 5. the arrangements governing ministerial decisions on the fuelling of new power stations;
- 6. the powers granted by the Coal Industry Act, 1967, to subsidise the use of extra coal by the electricity and gas industries;
- 7. the social support measures of the 1965 and 1967 Acts;
- 8. and the whole range of regional policy instruments including the special development and intermediate areas, all of which are now marshalled in the Ministry of Technology, with the old functions of the Ministry of Power.
The Coal Board, with the full co-operation of the miners and their union, and with the help of the Government, have made impressive progress towards these objectives since 1967. Between the end of 1967 and the end of 1969 the average output per colliery rose by about 12 per cent.; the proportion of faces with powered roof supports increased from 44 per cent. to about 80 per cent. Today, nearly all deepmined coal is being produced by mechanised methods.
In 1967–68 and 1968–69 there was a surge in output per manshift of 6.6 per cent. and 9 per cent. respectively, and costs in real terms were reduced. Unfortunately, by contrast, in 1969–70, productivity rose by little more than 2 per cent., costs increased sharply and a general increase in prices became unavoidable. This was, however, the first general price increase for nearly four years.
The recent falling off in the growth of productivity is potentially serious. The technical possibility for further substantial increases is known to exist, and there is good reason to hope that productivity will again rise sharply. A substantial improvement on the increase achieved in 1969–70 will be needed if the 763 industry is to contain its costs and maintain its competitive position in the face of the advances which can be expected in other energy industries. The recent setback, however, should not be allowed to obscure the very solid progress made by the industry since 1967. Nor should anyone forget that these recent years have been exceptionally difficult ones for the industry and especially for the miners. It is they, inevitably, who have borne the brunt of the industry's rapid transformation.
The Government foresaw in 1967 that a heavy programme of pit closures and redundancy was unavoidable and, to mitigate the impact of concentration and modernisation on the miners, support was provided on an unprecedented scale. The policies we have followed have many substantial successes to their credit.
The Government's development area policies need no justification from me. Their impact on the ground, and their success, is evident to anyone who knows or travels in the area concerned. No less than four of the special transitional measures of the 1967 Act were principally directed towards the alleviation of hardship in the mining communities.
These were the redundant mineworkers payments scheme; the advance payment of pensions to redundant miners; the Government contribution of two-thirds towards the board's social costs and the reimbursement of losses incurred by the board in deferring closures at the Government's request.
So far, 28,000 miners have benefited under the special redundancy scheme. By March, 1971, the scheme, together with the premature pension payments, will have cost the Exchequer £30 million, with a further £15 million committed. Under the 1967 Act, too, the Government have so far contributed about £26 million towards the board's social costs. By March, 1971—that is, next March—that amount will have reached about £38½ million. In addition, in the winter of 1967–68 16 closures were deferred at an Exchequer cost of £2½ million in order to avoid increased unemployment in the most difficult period of the year.
A fifth measure of the 1967 Act—the extra coal burn scheme—has also had a substantial impact on the man- 764 power situation. With output per man shift rising strongly in 1968 and undistributed stocks well above normal levels they were at a peak of nearly 30 million tons in the summer—the powers under the Act to pay the electricity and gas industries to use extra coal were used at that time to the maximum practical extent.
These industries used an extra 7 million tons of coal in 1968–69 at a cost to the Exchequer of over £10 million. With this help total consumption of coal was 168 million tons, actually slightly higher than in 1967–68. In effect, this support kept open about 15,000 mining jobs at a time when the rate of closures and manpower rundown was at its peak, and hence for those involved at its most difficult. Last Session, the Select Committee made a thorough study of the working of the 1967 measures and reached generally favourable conclusions. The Committee found that their effectiveness in practice had been fully proved.
Before turning to the specific provisions of the Bill, I propose to set them in the context of the prospects facing the industry over the next few years and to explain why the Government take the view that the 1967 measures, of substantial help, which were intended only for a transitional period, should now be continued for a further period, as is recommended in the Bill. One of the fundamental problems will continue to be that of keeping coal supply and demand in line with one another in a situation where, by the very nature of things, there are bound to be fluctuations—and largely unpredictable fluctuations—around the trend.
Proportionately, quite small fluctuations in the factors affecting demand and supply can lead to substantial disparities between output and consumption. We have all seen over the years, and again very recently, how swiftly the coal situation can move from excess to shortage and back again for just these reasons and, obviously, our policy must be to seek to even out these fluctuations so that short-term situations do not lead to long-term damage. If I were looking for a word to describe that policy, it must inevitably be a policy of flexibility.
§ Mr. Alex Eadie (Midlothian)
My right hon. Friend is talking about coal production and coal consumption and is 765 using the words such as fluctuation and now the question of flexibility. Can he tell us whether there is any question of the importation of coal in his mind?
§ Mr. Wedgwood Benn
If my hon. Friend would allow me to do so I shall develop my argument—and I am now deploying the argument against a background, or rather a forecast, of the prospects in the immediate future. My hon. Friend has asked me a specific question and if I do not deal with it myself my hon. Friend will deal with it in replying to the debate. It is important to look at the Bill against a general performance of the industry and if he will allow me to I shall continue in the order in which I have put my points.
We have seen over the years how swiftly the situation can change, so our policy must be to seek to even out the fluctuations so that the short-term situation does not lead to long-term damage. The 1967 Coal Industry Act provided us with an additional means of coping with short-term situations of coal surplus—the extra coal burn scheme. This particular device has proved its worth and the Bill we are debating today will continue to give power of this kind for a further three years after March, 1971.
Taken together with the extensive room which now exists for additions to coal stocks, the new power should provide a very substantial guarantee to the coal industry—and this is what really lies behind my hon. Friend's intervention—and to the men who work in it, that they can go out for higher productivity and lower costs without fear that they will jeopardise their own future.
As the recent Select Committee report on coal emphasised, it is only through higher productivity and lower costs that the coal industry, or, for that matter, any other industry can ensure its long-term future. We have to take account of the possibility that events might lead to a short-term shortage of coal, and consider how we would deal with such a situation.
It would be highly dangerous for the future of the coal industry were such a thing to happen because markets once lost through inability to supply would never be regained. It is, therefore, harder to deal with this than with the problems of a temporary surplus. Stocks and opencast working provide only limited flexibility.
766 The conversion of some power stations to oil or natural gas would reduce the pressure on coal supplies, but could also entail a permanent loss of outlets for coal. Conversions will, therefore, continue to be very strictly controlled. The decision announced two weeks ago to permit the Hams Hall "C" power station to be converted to dual firing—able to use either coal or natural gas as circumstances require—is a useful step towards greater flexibility. Equally, the decision announced at the same time not to permit the conversion of Tilbury "B" power station from coal to oil is an example of a refusal to use long-term and irreversible measures as an answer to short-term and temporary situations.
§ Mr. Eric Lubbock (Orpington)
If the right hon. Gentleman has refused consent to the C.E.G.B. to permit the conversion of Tilbury "B" power station or any other power station from coal to oil, will they qualify for assistance given for the burning of coal under the Bill or not?
§ Mr. Benn
No. It is for the Minister to decide what attitude will be taken towards the fuelling of new power stations and on the conversion issue. This is not burning within the merit order so as to deal with the situation I was referring to earlier. It has followed very close consultations both with the Coal Board and the Electricity Generating Board. We went into this point carefully.
My point is that whereas the Hams Hall "C" power station decision left open, by dual firing, the option of burning coal, the Tilbury conversion would have left an outlet which was a straight conversion to oil and not oil and coal. I am trying to use this as an example to show that the temporary shortage is not used to do any long-term damage to the coal industry, its output or its products.
§ Mr. Keith Speed (Meriden)
As the right hon. Gentleman is aware, Hams Hall "C" power station is in my constituency. What are the safeguards if, next year, there were to be a surplus of coal but it is chosen by the Generating Board to maintain the power station on natural gas the whole time? How flexible is "flexibility" in this case?
§ Mr. Benn
Flexibility in a technical sense is almost total. I am given to understand by the Generating Board that 767 conversion from gas to coal firing can be done in an hour or so. This is something which will be negotiated between the Generating Board and the Coal Board, as one would expect between customer and supplier.
As the hon. Gentleman knows better than most, one of the boilers has been experimentally converted to see whether conversion will operate satisfactorily. One of the biggest advantages of doing it this way is that it does not do any damage. The Generating Board is waiting to negotiate with the Coal Board about the long-term supplies of coal, and so on.
The level of coal demand in the 1970s will really depend on the industry's success in increasing efficiency and reducing costs. There is a range of possibilities which widens the further one looks into the future. If output per man shift grows at an average rate of 5 per cent. per year—the long-term trend of the 1960s—demand for coal for 1975 should be close to the much debated 1967 estimate of 120 million tons. The prospects for demand would be improved if output per man shift increased at 9 per cent. per year, as in 1968–69, but, obviously, would not be so good if it grew only at the 1969–70 rate. The greater the industry's success in increasing productivity and reducing costs, the stronger will be the case for continued Government support of coal use.
Meanwhile, the streamlining and strengthening of the industry must continue. Over the period of the Bill, the industry will concentrate more on the low-cost pits, but, happily, the pace of contraction should be slower than during the period since 1967. The Government have agreed that the board should, for the time being, plan on the basis of a rundown of not more than 10 per cent. a year. The board advises that contraction at this rate will be manageable for it and with the Government's regional measures, which we are determined to pursue vigorously, the provisions contained in the Bill should make it acceptable. For the record and for the interest of hon. Members, the current rate of contraction is well below this figure and as far as can be foreseen is likely to remain below it, certainly for some little time to come. That is to say, the worst of 768 the closures and manpower reductions is definitely over and, looking ahead, we can, therefore, contemplate some reduction in the scale of support in the early 1970s.
Impressive progress has been made since 1967, but much obviously remains to be done. A formidable task certainly still lies ahead of the industry and it would be premature to allow the special transitional powers of the 1967 Act to lapse next year. It will still be necessary to alleviate hardship to individuals and communities caused by the continued contraction of the industry.
The powers to extend the measures of that Act are contained in Clauses 1 to 4 of the Bill and I propose now to explain briefly the salient features of each of these Clauses in turn.
Clause 1 extends for three years the power to make contributions towards expenditure incurred by the board in the redeployment of manpower and related expenses arising from the closure of uneconomic pits and the concentration of the industry on the more productive pits. These costs include redundancy payments and removal and resettlement expenses. The present rate of grant will continue to be two-thirds in the first year, tapering to half and one-third in the following two years. Although the hump of the manpower rundown has been passed, it has imposed a substantial continuing financial burden on the board. By the time the tapering takes effect, but not before, the board's social costs should be beginning to decline.
§ Mr. Peter Emery (Honiton)
In November, I asked the Paymaster-General whether he would supply the up-to-date figures relating to the White Paper on Fuel Policy. He replied that he would try to do so before the Bill was laid. It has not happened, however. Today, the right hon. Gentleman has given figures relating only to the coal-burn side. Will he consider whether we could not have, between now and the Committee stage, the whole of the up-to-date figures relating to the White Paper?
§ Mr. Benn
I would be in some danger of entering into a debate going even wider than the wide terms of reference of a Second Reading in arguing the merits of whether or not there should be another 769 major White Paper about the fuel industry as a whole. I hope that I have said enough, in dealing with the industry, to give a progress report on what has happened since the 1967 White Paper. That was my intention. I hope that I have also given some prospects for the future which will allow the House to reach its judgment on the Bill.
If the hon. Gentleman the Member for Honiton (Mr. Emery), because of his known interest in this matter, wants another White Paper of a general character, that is going a little wide of this debate. No doubt, if he catches your eye, Mr. Speaker, he will make his case. But I think that I can claim that I am putting enough information before the House to allowed it to reach a judgment on the Bill. A Minister, in presenting a Bill, cannot really do much more than that.
Clause 2 will extend for a further three years the power to make special payments schemes for redundant mineworkers and also the linked provision under the 1967 Act for the payment of premature pensions. Unlike the 1967 Act, the age limits are not prescribed in the Bill because, after March, 1971, we propose that the age limits should be prescribed in the schemes made by Statutory Instrument, subject to the approval of both Houses of Parliament. This Bill does not in any way represent, therefore, a diminution of parliamentary supervision.
We are making provision for a period of up to four years ahead and cannot foresee what the situation in the industry will be that far ahead. The age limits have been left out in order to give the maximum flexibility to adapt the arrangements should that become necessary to take account of changing circumstances. I can assure the House that we have no intention of making any change of substance before March, 1972. We propose to renew the present scheme broadly in its present form for an extra year from March, 1971, and its form and operation for men becoming redundant thereafter will be reviewed during the course of 1971.
§ Mr. Edwin Wainwright (Dearne Valley)
How much discussion has my right hon. Friend had with the Coal Board and the National Union of Mineworkers about new arrangements for the ages to be re- 770 duced and not fixed at, as previously, from 55 onwards?
§ Mr. Benn
There have been very full discussions. My hon. Friend the Member for Dearne Valley (Mr. Edwin Wainwright) knows that the contact between Ministers and officials of my Department and both the N.C.B. and the N.U.M. is close. By leaving the age for settlement by Statutory Instrument rather than providing for it in the Bill, we are postponing a decision. There is no intention of making a change for some time and it is certainly my intention to see that there is adequate consultation on this point before further proposals on age might be produced to the House.
The power to reimburse the N.C.B. for the cost of defering closures at the Government's request is being retained on a contingency basis. Although the Select Committee draw attention to the high cost in relation to benefits, we thought it right that this power should be retained. But it is costly and for that reason deferments will only be requested if they are necessary to avoid exceptional hardship.
Under Clause 3, the period within which the financial provisions of the 1967 Act may be used will be extended for a further three years.
One of the board's major aims will be to keep supply and demand in balance in the future and our expectation is that this should be possible. But, as I have already argued, a recurrence of a coal surplus cannot be discounted. The extra coal burn scheme has proved to be a quick and effective means of boosting coal demand. In view of the uncertainties, it is common prudence to retain powers to reimburse the electricity generating boards as an insurance measure. An instrument will thus be ready to hand should it be needed to avoid an excessive rundown or an excessive accumulation of stocks.
§ Mr. G. Elfed Davies (Rhondda East)
In view of the fact that in the immediate future, although this is there to safeguard what might happen, it does not appear likely, in view of the coal shortage, that this will be needed, has my right hon. Friend considered whether money that normally would be paid to compensate the Central Electricity Board could be used to compensate the Coal Board for keeping marginally uneconomic pits open to produce the coal that we need?
§ Mr. Benn
I understand what my hon. Friend says, but I believe that he would be wrong to suppose that there is a fixed sum of money available to be used on one side or the other of the equation regardless of changing circumstances. We must keep these powers in case it is necessary to use them; but if it is not, it does not necessarily follow that an equal sum of money is available to do something quite different.
With regard to the position on closures, the rate is totally different this year from the rate we have been experiencing in previous years; and in closures contemplated the exhaustion of the mines themselves is a major factor. But in discussion with both the miners and the Coal Board I have made clear that I am keeping an eye, as one would expect, on the closure position. Therefore, the main point behind my hon. Friend's intervention is something which is very much in our mind.
I must make one distinction between this and the previous Act. Unlike the similar provision in the 1967 Act, Clause 4 of the Bill will not apply to the gas industry which, by 1971, will be using only a small and rapidly diminishing amount of coal. Finally, the opportunity of legislation has been taken to clarify the extent of the board's offshore petroleum powers, to confer on it powers to borrow in foreign currency and to give technical assistance, overseas. It is Government policy to encourage foreign borrowing by the nationalised industries in the interests of the balance of payments. Similar powers to that now proposed in Clause 5 for the Coal Board have already been conferred on the Electricity and Gas Councils, the Steel Corporation, and several other nationalised bodies.
I am sure that the House will also particularly welcome Clause 6, which will enable the board to make its special skills available to developing countries. Similar powers have been included in recent legislation relating to other public bodies. Paragraph (a) of Clause 6 empowers the board to enter into and carry out agreements with my right hon. Friend the Minister of Overseas Development. Technical assistance provided under such agreements will form part of the British aid programme and the costs will be met by the Minister of Overseas Development 772 within the financial ceiling for that programme.
Paragraph (b) of Clause 6 relates to assistance provided outside the official aid programme. It empowers the board, with my consent and that of the Minister of Overseas Development, to enter into and carry out agreements with overseas Governments and other authorities, for example, international organisations. The costs of furnishing technical assistance in such cases will be met by the authorities concerned and no expense will fall on the board.
Clause 7 is simply intended to put beyond doubt the board's powers to search for petroleum in coastal waters. These are such small areas as the Wash and Firth of Forth, which lie between the mainland and the baseline from which the territorial sea is measured. It is held to be uncertain whether the N.C.B. (Additional Powers) Act, 1966, which gave the board powers to search for oil and gas on the Continental Shelf and in territorial waters, extends to these waters and, therefore, at the board's request the opportunity is being taken to clarify the position.
The Bill concerns the affairs of a very great industry, an industry on which the industrial power of the country was largely based, an industry to which we all owe an immense debt. But there really is no need to look to the past to justify the further measures of support which the Bill provides. Over the last few years, the coal industry has shown its capacity to adapt to change. It remains very much alive, forward looking and keen to exploit new techniques and ideas.
No one associated with the industry would doubt that it still faces formidable difficulties but over the next five years the pace of contraction should be much slower than in the past five years. The future trend of demand for coal will depend largely on the industry's success in increasing efficiency and holding costs down. The greater its success the stronger will be the case for continued Government support. It is in that spirit that I commend the Bill to the House
§ Several Hon. Members rose—
§ Mr. Speaker
May I remind the House that every hon. Member from a mining 773 constituency is here and anxious to take part in the debate. Brief speeches will help.
§ 4.27 p.m.
§ Sir John Eden (Bournemouth, West)
The House will be grateful to the Minister for his introduction of the Bill and for the survey of the important industry with which it is concerned. The problems of the coal industry are not very easily analysed and, certainly, they do not permit of a very simple solution. It is not like some industries, where we have had arising a situation which involves a more or less straightforward matter of product substitution. In this major sector of industry we are witnessing a gradual and sometimes painful adjustment to changed economic and competitive circumstances.
The first point, which I know is recognised by all hon. Members and really does not need further emphasis, is that these changed circumstances do exist. It does no one any good to pretend that they do not. With the advent of nuclear power and natural gas the forces of change have gained in momentum, but the underlying trend has been apparent for a good many years. In the experience of the National Coal Board there is nothing new about colliery closures. It is not a phenomenon with which it is suddenly having to learn how to grapple.
Over the whole 12-year period from the time of nationalisation to 1960 there were, on an average, 25 collieries closed in each year. Between 1960 and 1965 the average number of collieries closed increased to 41 a year. I have chosen 1965 for reasons which will be obvious to hon. Members, for it was in that year that the first of the special remedial measures was introduced, which was later supplemented by the 1967 Act, now confirmed and extended by the present Bill. But from 1965 to 1969 the average rate of colliery closures was 54 per annum. This was the extremely high rate which has precipitated some of the recent difficulties which have been causing problems in the industry.
We see, therefore, that it has always been the policy of the Coal Board to close uneconomic pits. This has been accelerating, partly naturally because in drawing further away from 1948 there is a growth in the number of collieries be- 774 coming exhausted, and partly because of the growing impact of competition from other fuels. However, it has always been the policy to concentrate upon the closure of uneconomic collieries which have no reasonable prospect of recovery. They constitute a burden which, if it is expected to meet competition, the industry cannot be expected to sustain.
As the right hon. Gentleman has made clear, there is a degree of co-operation between the men and the management in the industry which is very much to the credit of all concerned. Those who work in the industry, in whatever capacity, will know and well understand the situation affecting them. I believe that this cooperation is an example of the enlightened leadership which has shown itself at all levels of the organisation. There is a clear understanding that the fate of the industry is in their own hands. This co-operation is only placed at risk if the rate of closures seem to be getting out of control. I absolutely endorse the sentiment of the right hon. Gentleman that the process of adaptation must not become a headlong rout. Nobody wishes to see that happen. We recognised that when we supported the 1965 and 1967 Acts. For that reason, also, we shall not vote against the Bill tonight.
The Bill, as we see it, has two objectives. The first is to restrain the rate of contraction of the industry. The second is to lessen the effects of that contraction on individuals. Atlhough, together these two objectives form part of a combined operation to meet a particular situation, the exact weight to be given to each requires careful consideration.
I have no hesitation in saying that it is our view that the human consequences of change must be tackled with vigour and imagination. During debates of this kind reference is always made to the arduous, unnatural and often dangerous tasks in which miners are engaged. It is not an empty ritual. We respect the deep feelings of hon. Members who have had personal experience of the industry and salute the fortitude of the men who are often engaged for long hours in difficult circumstances underground at the coal face. Many of us know the consequences of the hazards to which they are subjected. I have a 775 particular advantage over some of my hon. Friends in that in my own constituency is one of the finest miners' convalescent homes, with a really outstanding matron in charge, where it is my privilege to see many miners from South Wales as they recover from respiratory and other complaints which, unfortunately, have befallen them.
For many of the older miners, mining is a way of life. When a colliery closes there is bound to be some disruption for them, perhaps more than any others. It must be our purpose to try to minimise that disruption. Broadly speaking, when a colliery closes there are three main requirements. First of all, the men concerned must have time in which to adjust to the new circumstances affecting them. Secondly, they must have an opportunity provided to them for alternative profitable employment. Whether it is in the area immediately adjacent to the colliery that is closed or elsewhere, is another matter. The retraining needed to make such an aim attainable is also an essential feature of the employment opportunity. Thirdly, if there is to be a move to another part of the country in order to secure employment these workers must be helped with the problems of upheaval and the difficulties in finding a home.
In our consideration of the various remedial and resettlement measures we in this House have been greatly assisted by the invaluable and informed Report of the Select Committee on Nationalised Industries. I am sure that the House would wish to pay tribute to the work of that Committee, and particularly to my hon. and gallant Friend the Member for South Fylde (Colonel Lancaster) and the hon. Member for Poplar (Mr. Mikardo), who chairs the Committee. We hope to discuss these matters in some detail in Committee, and especially will we wish to look more closely at the need for advancing the age of premature retirement and the impact of redundancy payments on transfers within the Coal Board.
Also involved in trying to encourage a greater readiness to move in search of employment is the question of tackling the special problems facing communities which have grown up around an industry now in decline. This matter was con- 776 sidered very carefully by the Select Committee. One solution that was advanced was not referred to today by the Minister of Technology, although he mentioned it in his formal reply to the Committee's recommendation. It was that the Govern-should consider paying regional employment premium to the Board to promote coal-mining employment in the development areas. The right hon. Gentleman said he would look at this matter, but he also said that he recognised that it would amount to a departure from the declared policy of producing the cheapest coal. I agree with him on that. It would also make great nonsense of the selective employment tax proposals, which is part of the whole R.E.P. structure. In any case, since the S.E.T. will go with the change of Government, the right hon. Gentleman need not spend too much time on it.
§ Sir J. Eden
I hope that my hon. Friend the Member for Cirencester and Tewkesbury (Mr. Ridley), who, I see, from the Report of the Select Committee's proceedings, stood on his own in this matter, will be able to develop this argument a little further.
All far-seeing supporters of the coal industry must wish the board to concentrate its endeavours on abandoning the more exposed and expensive positions. Only in this way will it be able to preserve the market for solid fuel. Displacement of manpower has come about not solely as a result of colliery closures. It is a feature of the new mining methods which increasingly are having to be adopted wherever geological conditions will allow. Machines must obviously take the place of men and more mechanisation in the long-life pits is the key to productivity increases in the future.
If replacement of manpower in this way takes place, it does not reduce the need for men to be trained to new engineering skills and the need for new recruits. The skills present in our mining industry are well recognised throughout the world. This is part of the reason why there is some significance in the proposal contained in the Bill that the Coal Board should be able to take part in technical assistance overseas.
777 This probably is one of the most valuable forms of assistance for overseas countries. But the right hon. Gentleman will know that there are private enterprise consultancy firms already engaged in this field undertaking this sort of work. We shall seek to put forward certain considerations in Committee to ensure that in so far as there is competition it is properly conducted and fairly managed.
The question of the need to recruit new skills emphasises the dilemma confronting those who are having to manage the industry. It is not only a question of controlling the rate of contraction, but also a matter of recruiting and retaining the right calibre of men to guarantee coal's place in the future. I have no doubt that coal has a future, though it will not be exactly the same as in the past. It will be different in dimension and in its markets, but there are great opportunities for coal today. My only doubts relate to the time the industry is taking to put itself in the best position to seize these opportunities. The industry has problems enough with which to contend without having any added to them either as a result of Government policy or through their own failings.
At this point, I will touch upon the extremely disappointing productivity figures. They have caused concern to everyone in the industry, and it is most unfortunate that they should have coincided with a dramatic increase in demand. For years when it was difficult to sell the coal being produced, the stockpiles were growing. Now that we see the stockpiles coming down to almost alarmingly low levels and the demand for coal is high, not enough is being produced. Last year, the output per manshift rose by 8.7 per cent. This year, with a target of 9.6 per cent., only about 2.3 per cent. has been achieved. I hope very much that what the right hon. Gentleman said about the possibility of it improving later this year will materialise.
The impact of any change in productivity in financial terms was made clear in the Coal Board's evidence to the National Board for Prices and Incomes. Then, it was said that a change in the output per manshift of 1 cwt. is equal to £10 million in profits. If the impact on the finances of the coal industry is 778 significant, I think that it is even greater on the customer. If the customer cannot get solid fuel, inevitably he will be forced to turn to other sources of heat and energy. Coals competitors are fighting hard and, although they may be sympathetic to the difficulties confronting the coal industry, they are not standing idle watching opportunities available to them passing them by.
There is no point in slamming coal's competition. Impassioned speeches attacking gas and nuclear power are a poor substitute for improving the competitiveness of coal, and this is well illustrated by the current crisis in the supply position of solid smokeless fuel. Perhaps the Government will at last recognise that this is a serious matter and that their complacency has been misplaced. The Paymaster-General should tell us tonight not only about the immediate position, which is causing wide-spread disquiet in the country, but also how he sees the position next winter. I ask him to tell us the facts, unadorned and unconcealed. There appears to be little doubt that the position next winter will be very much worse than it is at present.
Equally, there is no doubt that, in spite of all the Prime Minister's brave talk about the fight against pollution, the Government are now having to slow down the rate of smoke control orders. This was made clear in a letter from the Parliamentary Secretary to the Ministry of Technology to my hon. Friend the Member for Newcastle-upon-Tyne, North (Mr. R. W. Elliott). There is every likelihood that a growing number of smoke control orders will have to be deferred in the years ahead as a result.
It is not fair for the Coal Board to attempt to avoid its own responsibility for the situation which has arisen by blaming all on the Gas Council. In past debates, we have heard too often and too much about the "Bronowski bullet" story for me to go over it again today. I am sure that the Coal Board must concentrate on getting this right first. Everything turns upon its ability to manufacture solid smokeless fuel for the growing market which has been apparent to all of us for a long time.
When I look back at the 1966 debate on the Additional Powers Bill, I notice that practically every one of my hon. 779 Friends who took part drew attention to the market opportunities which existed for the manufacturers of solid smokeless fuel. A major cause of the present shortage is the Coal Board's failure to meet its own production forecasts—
§ Mr. Eric Ogden (Liverpool, West Derby)
Before the hon. Gentleman leaves this point, as he and his hon. Friends are those who support competition most, may I remind him, without wishing to put any blame on one section, that a great many of the difficulties that we face have arisen because each section of the fuel and power supply industry has been encouraged to make its own proposals to grow as fast as it can, without any attempt being made to co-ordinate them?
§ Sir J. Eden
No doubt the hon. Gentleman will have an opportunity to develop that argument. Of course, it is a point of view which has been expressed by the Chairman of the Coal Board, amongst others.
These production difficulties which have affected the provision of solid smokeless fuel must be overcome by the producers of solid smokeless fuel. It is their problem as well as their opportunity. That is why we regretted in 1966, and still regret, the diversion of effort of top management into such activities extraneous to the coal industry as exploring for gas and oil on the Continental Shelf. We shall have an opportunity to return to this point when we come to consider the Clause concerned with borrowing abroad.
The right hon. Gentleman made it clear that the purpose of giving the Coal Board the power to borrow abroad was to enable it to finance its operations in the Continental Shelf exploration—
§ Sir J. Eden
I withdraw it completely if the right hon. Gentleman did not say it. I understood him to imply that, and I thought that it was the main purpose for his wishing to bring in this provision.
§ Sir J. Eden
I have apologised, and I do so again because I have no wish to misinterpret what the right hon. Gentleman said. However, I suspect that the two matters may be linked in the mind of the Coal Board. Obviously, while we have no objection to logical diversification in a nationalised industry so long as it holds some significant relevance to the primary purpose for which it was taken into the public sector, it is quite unjustified for it to move into a wholly alien activity.
Smokeless fuel is one example of a lost market opportunity. Another is the position of coking coal. This is extremely serious. Again, it is regrettable that, at a time when there are considerable opportunities for sales overseas, we are not in a position to take advantage of them. The right hon. Gentleman said that the Paymaster-General might comment on the position when he replies to the debate. I hope that he will tell us what is happening about imports. The British Steel Corporation and the Coal Board are engaged in consultations at the moment, and I would have thought that the Corporation would want to be secure about its supplies of coking coal. Is it the Government's intention to ease the ban on imports which, after all, is another form of protection for the coal industry? If that is the intention, will the importation of coking coal be done by the Corporation or by the Coal Board?
§ Mr. G. Elfed Davies
Has the hon. Gentleman considered the effect on the morale of men in the industry when he talks about importing coal, in view of the closures and the suffering that they have endured?
§ Sir J. Eden
Of course I have considered that. But this matter was raised first by an hon. Gentleman opposite during the course of the Minister's speech and the right hon. Gentleman said that it would probably be dealt with by the Paymaster-General when he replied to the debate. I hope that it will be.
The provisions in the Bill to subsidise the generation of electricity by coal in one form or another, where this is necessary in future, are a straight extension of the provisions in the 1967 Act. The House will have noticed that recently a number of decisions have been made about new power stations. Although there has 781 been the welcome decision about Drax "B", the bulk of the others seem to be intended to become nuclear stations. Heysham and Sizewell have already been approved. This will bring the total of nuclear power stations to 15. Other stations for which the C.E.G.B. is seeking approval, I believe, are in South Hampshire, Connah's Quay, Stourport-on-Severn, Chepstow, Oldbury "B", and two more in Scotland. They are all intended to be nuclear.
The pattern seems clear. It is already expected that, by 1976, 20 per cent. of energy capacity will be nuclear-fired and will account for a quarter of the United Kingdom's electricity—
§ Sir J. Eden
As the hon. Gentleman says, it may be even more than that. The Minister will almost certainly have considered the enormous capital cost involved. I hope that hon. Members will recognise that the pattern is now being set for many years ahead and that, as a result of the decisions taken by this Government, it has clearly been weighted in favour of nuclear generation.
Having spoken about miners and customers of the mining industry, I turn now to the taxpayers. They have some interest in what we are discussing. I know that hon. Gentlemen opposite recognise this. Taxpayers have already been affected by the loss of interest and the capital write-off of £415 million. They are also affected, as the right hon. Gentleman recognised, by the fuel tax, which now yields about £100 million a year and was designed as a form of protection for coal. They may also he affected by the misplacing of resources as a result of investment decisions being distorted by short-term considerations affecting the industry. We must try to reduce those distortions wherever possible. All this gives a little hollow ring to the words in "The Task Ahead" thatGovernment policy towards nationalised industry is based on the leading role they can play in promoting the competitive strength and future growth of the economy.When the right hon. Member for Greenwich (Mr. Marsh) introduced the Coal Industry Bill in 1967, he said:The purpose of the Bill is to enable the coal-mining industry to have a breathing space 782 …"—[OFFFICIAL REPORT, 28th Nov., 1967; Vol. 755, c. 253.]Hon. Members—both Government and Opposition—have willingly given it that breathing space. The people as a whole, I am sure, have recognised the need and the justice for doing so. Now, by this Bill, the period is to be extended for a few years more. Between now and 1974 it must surely be the main aim of all in the industry fully to justify the support that it has had and to live up to our hopes for its future.
§ 4.55 p.m.
§ Mr. James Sillars (South Ayrshire)
In his opening remarks my right hon. Friend the Minister of Technology said that the miners had given unstinted service to the nation. They have also given unstinted service to the Labour Party. That is the reason I am here today with the kind of majority that we got at the recent by-election in South Ayrshire.
Before addressing myself to the Bill, it is necessary to say a few words about my predecessor and friend, the late Emrys Hughes. Everyone in the House knows that he was a man of very strong character, an individual in his own right, a man of wonderful wit and a great deal of charm, who devoted the whole of his public and political life to the pursuit of pacifism and Socialism.
I am sure that the whole House mourned the passing of Emrys Hughes. But the grief was felt most among the people who knew him best in the county of Ayrshire—not only in South Ayrshire, but in the five constituencies.
We were very proud of Emrys Hughes. We did not always agree with him. No doubt the Government Whips will be interested in that observation. In many respects Emrys conveyed the political philosophy which pervades and enriches the lives of the communities in Ayrshire, particularly in South Ayrshire. He was endowed with enormous talent which he poured into his belief in Socialism.
I am aware that many people might sometimes have thought Emrys's commitment to Socialism and the beliefs that he espoused were somewhat "pie in the sky" and Utopian, but it may be little known in the House that, long before Emrys came to it, he was a giant in local government in Ayrshire and had, in fact, 783 proved that Socialism was a practical belief and could be introduced to the benefit of communities.
In South Ayrshire, there is a small burgh called Cumnock. It is perhaps one of the most progressive local authorities anywhere in the United Kingdom, for the quality of representation on the council—while is wholly Labour-controlled—is of the highest. Cumnock is a living monument to the work that Emrys Hughes did for the people of that area many years before he came and graced this House with his presence.
I thought it necessary to say those few words about someone for whom the people of Ayrshire had the greatest admiration, respect and love.
I should also like to mention the people in my constituency. This is the first opportunity that I have had to contradict the slander of the hon. Lady the Member for Hamilton (Mrs. Ewing), in the television broadcast on the night on which the poll was declared, in which she implied that we obtained our majority because the people of South Ayrshire had been intimidated by the Labour Party.
The hon. Member for Hamilton presented two views of the people of South Ayrshire. In the first, before the by-election began—and it was quite accurate—she declared that she had never met people so politically conscious. I think that all the visiting Press and radio and television people found exactly the same. But, after these politically conscious people had rejected separatism for Scotland, the hon. Lady discovered that they were not so politically intelligent at all.
The people of South Ayrshire are renowned for their public responsibility and political consciousness. In the mining communities of South Ayrshire on polling day we had percentage polls ranging from 85 to 90 per cent. in torrential rain, and despite a public transport strike. No one, however intimidating, could have produced percentage polls of that nature. Even in local government—I hope that this is reflected in London, though I doubt it—we get about 65 per cent. polls. So it is necessary to write into the records of this House a correction to the misleading statement by the hon. Member for Hamilton.
784 I turn now to the Bill, which is very important to South Ayrshire. Although I am not a miners' M.P., I represent more pits and miners than some of the N.U.M.-sponsored M.P.s. South Ayrshire welcomes the introduction of the Bill, which extends necessary support to the industry to the point in time explained by the Minister. But I would say to him, with all due respect, having just come from a by-election situation where I have been involved in intimate contact with men in the mining industry, that, however welcome the Bill might be, it is not really adequate to the fundamental necessity of raising morale and ensuring for the industry a rôle in the technological future which the miners think the coal industry can, on merit, demand. It should not be necessary in this House, made up entirely of politicians, to emphasise the importance of morale. Hon. Members know how they felt before South Ayrshire and how they felt after it. Morale is extremely important.
In the debate in July 1967, my hon. Friend the Member for Ebbw Vale (Mr. Michael Foot) quoted Will Paynter, the then general secretary of the N.U.M., telling the Government that increased productivity depended on the morale of the labour force. My hon. Friend pointed out that, unless we did something fundamental to secure for the industry the targets it thought necessary, there would come a point when we would not have the men to get the production that the supply position demanded. That has happened. In my constituency there is a manpower shortage. So I emphasise the necessity to do something long-term for the industry which does something first for its morale.
No one should under-estimate the damage done to miners' morale by the publication of the 1967 White Paper and by the manner in which it has been handled ever since. The miners are rather concerned that the House has never had the opportunity to state an opinion on the 1967 White Paper, although they are firmly of the opinion that it has been implemented and that some of the apparently secret documents which circulated before that, talking about tonnages in the 1980s, are also being implemented. It is essential for the Government, before too long, to produce a fundamental review of their fuel and 785 power policy, in the form of a new White Paper.
It is only fair that people should ask what my attitude is to the matter. I suggest that there are some things that the Government can do to secure for the coal industry the rôle which we think essential. In electricity generation, they must resist the political pressures which are being built up by the electricity generating boards in England and Scotland, and by the oil companies. Perhaps we should advise the electricity boards and the oil companies to slacken their attack on this industry.
The domestic market is not so important, by any means, as the electricity generation market, but the Government can do a great deal to support the industry and guarantee it consumption points in this market. We talk about the quality of life. I would advise hon. Members to spend 24 hours in some of the council houses where working-class people live, where only the living room is warm enough to be habitable. There is a market there for coal, provided that the Government are willing to give lower rates of interest to local authorities willing to install coal-fired central heating in local authority houses, or to implement schemes of district central heating for council houses.
Next the commercial market, which also involves the hospital authorities. I am a former member of the Western Regional Hospital Board, where we operated the 5 per cent. differential in favour of coal. We have yet to operate it in practice, because that differential is not good enough in present circumstances. The Government should review this Measure upwards. Many of us on this side are well aware of the representations of the N.U.M. for a further financial reconstruction of the industry and the introduction to that industry along with others of the regional employment premium, which I regard as fairly important.
I make no apology for making a plea for the mining industry. I was tickled to death to hear the hon. Member for Bournemouth, West (Sir J. Eden) talk about the industrial relations in the industry. He was right to pay tribute to management and to men. I might point out that the harmonious industrial relations in the mining industry have been 786 achieved without reference to the type of measures which the Conservative Party suggests are necessary on the national industrial relations scene. This is something which hon. Members opposite should mull over and draw lessons from.
I believe that, in a maiden speech, one should be brief unless one is never called again. I have made the points that I wanted to make. I hope that the Minister will take to heart the things that I have said about the need for a fundamental review of fuel and power policies and for a fairly early White Paper. I thank the House for its patience in listening to me.
§ 5.7 p.m.
§ Mr. R. W. Elliott (Newcastle-upon-Tyne), North)
It is with the greatest possible pleasure that I now congratulate, as is traditional, the hon. Member for South Ayrshire (Mr. Sillars) on his maiden speech, which was of the highest possible standard. We shall certainly hope that he will be called again. If all his speeches are as good as that one, we shall look forward to his future contributions.
He was so right to pay tribute to his predecessor. If I may separately congratulate him, he did that very well too. Emrys Hughes was an enormous character of this House. He was mourned on both sides. It is still difficult to believe that he will never again occupy that corner seat below the Gangway. As the hon. Gentleman said, the wit of Emrys Hughes was most acceptable to this House. I shall always remember the exchanges between Emrys Hughes and Mr. Harold Macmillan during the latter's Premiership. They were wonderful occasions at Prime Minister's Question Time when Emrys Hughes took on the Prime Minister; both he and Mr. Macmillan thoroughly enjoyed those encounters. We shall certainly look forward to hearing the hon. Member for South Ayrshire again. He is obviously a worthy successor to a very worthy Member.
The Minister has asked us to consider the Bill in terms of the industry's prospects. He made one telling remark—that markets once lost to the coal industry will be very difficult to regain. My speech will be mainly a criticism of the National Coal Board which, in one 787 particulth sphere, is in great danger of losing a substantial sector of the domestic market.
Clause 3 extends until 30th March, 1974, the Minister's power to reimburse the Coal Board for losses incurred as a result of depressing colliery closures.
As a representative of a development area in the North-East of England, I appreciate, as do those who know the mining areas of the North-East, the support which the mining industry has had. In the midst of the great difficulties which the development area I represent faces, I hope that there can be a slowing down of the pit closure process, where reasonably practicable, and that there will certainly be a continuation of subsidisation.
I am particularly concerned about the withdrawal of a subsidy from the production of smokeless fuel at the Elswick Works in Newcastle, where Gloco was produced. The withdrawal of this subsidy could lead to a massive crisis in the City of Newcastle and on Tyneside as a whole.
I shall refer to the failure of the N.C.B. to manufacture solid smokeless fuel in sufficient quantity at an economic price and I will then develop that theme from the point of view of the significant effects of that failure and the need for the continued subsidisation of the industry, as proposed in the Bill.
The emergency in Newcastle-upon-Tyne is such that the provisions of Clause 4 should be extended and enlarged albeit temporarily to assist the city and other local areas in the region the smokeless fuel stocks of which are practically exhausted. In Newcastle-upon-Tyne this has come to be known in recent weeks as the "Gloco saga"—it is a story of a lack of foresight, of hopeless lack of co-operation between the Government's departments concerned and a lack of accurate information. I agree with my hon. Friend the Member for Bournemouth, West (Sir J. Eden) that we must have full, urgent and immediate information on the position regarding smokeless fuel. Above all, the Gloco saga emphasises an enormous loss of opportunity on the part of the N.C.B.
The tragic facts are that whereas Newcastle-upon-Tyne has 12 smokeless zones, the principal city officer on the instruc- 788 tion of his authority yesterday announced that a relaxation will be sought for eight of the 12 zones because of a shortage of smokeless fuel. This is nothing short of an absolute disgrace and it represents an enormous immediate social problem.
Newcastle, which was one of the first authorities to take advantage of the Clean Air Act, possibly the finest piece of social legislation since the war, will now be forced because of bad management to become once again a smoke-ridden and unhealthy city. A report issued yesterday by the Gas Board indicates that supplies of Gloco will be exhausted by 25th April, 1970. I understand that it is now snowing in Newcastle which means that that estimate of 25th April may be highly optimistic.
As a result, 5,784 homes which have burnt Gloco will again be forced into burning raw coal. As in the past, I am sorry to say, Newcastle-upon-Tyne may well have again an unhappy health record due to air pollution. There are various reasons for this, such as the low-lying eastern sector of the city and surrounding industries. Our 12 smokeless zones have certainly done an enormous amount to improve the cleanliness of our air and the consequent health of our people. The great need now is for clarification.
In December of last year Lord Robens said that departments concerned with smokeless fuel dealt with this matter as though the right hand did not know what the left was doing. In the past few weeks I have been greatly reminded of that statement because that certainly appears to be the case.
During the past two weeks an application by Hebburn-on-Tyne Council for a relaxation of two zone orders was refused by the Minister of Housing and Local Government because he had been informed by the Solid Smokeless Fuel Confederation that supplies were available. So they are, but only until 25th April. This is a ridiculous state of affairs. I wrote to the Minister of Technology about this. I hope, as does Newcastle-upon-Tyne, for a speedy reply. We want to know exactly what the position is, because clarification is long overdue.
A return to burning more coal will have a heavily detrimental effect on the people of my area. In consequence I appealed 789 by letter which I phrased as carefully as I could to the Secretary of State for Social Security for any help that he could give. I pointed out that I was asking him to co-operate and to get in touch with his colleagues concerned because the health of the people of Newcastle was in danger due to the rundown of smokeless fuel stocks. The reply I received yesterday was to the effect that it had nothing to do with his Department; and I was told the letter was being forwarded to the Ministry of Technology.
§ Mr. Elliott
I am sure that you will be the best judge of that, Mr. Deputy Speaker. Meanwhile, it has a great deal to do with the Bill and if the hon. Member for Liverpool, West Derby (Mr. Ogden) will be patient I will come to the main part of my speech when I shall concentrate on the failure of the N.C.B. to supply smokeless fuel. My remarks now are an introduction to that.
It is nothing short of appalling that the Secretary of State for Social Services thinks that the fact that 5,487 chimneys will again emit smoke from raw coal being burned in grates which have been adapted for smokeless fuel, has nothing to do with health. This crisis is one of magnitude and necessitates subsidisation. Financial aid of some sort must urgently be given.
Most of all, I deplore the failure of the N.C.B. in one of the major coal-producing regions of the country which is what the North-East is; County Durham is very much a coal county—to ensure sufficient supplies. Is it not an absolute disgrace that the N.C.B. has not seen fit—after all the warning ahead—to establish in Durham or nearby a smokeless fuel-producing plant. I hope that that will be done in the near future, because there has been a deplorable failure on the part of the N.C.B. first to meet the essential community need and secondly to seize hold of a domestic market opportunity.
790 Private enterprise has produced smokeless fuel in the Midlands in two notable instances; the Coalite Chemical Co., of Bolsover, and the National Carbonising Company, producing Rexco, have been producing smokeless fuel for some time.
I have been asked from where we in the North-East are to get our smokeless fuel in future. Is it to be hauled all the way from the Midlands? After all these years will coals finally be brought to Newcastle?
§ Mr. W. E. Garrett (Wallsend)
It is worth pointing out that this is not unique. Last year coal was imported from South Yorkshire to Tyneside to burn in power stations.
§ Mr. Deputy Speaker (Mr. Sydney Irving)
I am reluctant on Second Reading to restrict the debate in any way, but the hon. Member is getting a little wide of the purposes of the Bill. They are concerned with reimbursement of the Board's losses in relation to pit closures and payments to redundant workers and other matters.
§ Mr. Elliott
My main point is to appeal for some of the money for the further support of the coal industry to be used in the solution of this immediate crisis. Therefore, I suggest with great respect, Mr. Deputy Speaker, while accepting your Ruling, that the case I am making has a bearing on this Bill. I ask that the Government should cease to evade the issue of this crisis. Will the National Coal Board, the Gas Board, the Electricity Council and the oil interests be brought together by the Government? Will the National Coal Board attempt at least to get down to producing a modern product which, in the interests of public health, is urgently needed at this time in the North-East of England?
§ 5.21 p.m.
§ Mr. Robert Woof (Blaydon)
I am very pleased to follow the hon. Member for Newcastle-upon-Tyne, North (Mr. R. W. Elliott). The House will accept his unstinted support of the plea for assistance to the coal industry. I also trust that it will accept his most sincere and unstinted plea for a much more successful solution to the problem of providing smokeless fuel, which is badly 791 needed in his constituency. I hope that the Minister has taken note of what he said and will be able to supply him with the proper answer, of which all of us from the North-East are fully aware. The hon. Member has our sympathy in such a struggle.
There are several valid reasons why I welcome the helpful measures contained in this Bill, especially as they are to extend to the coal mining industry for a further period of three years. Those of us who have had a long and varied experience within mining communities, and have grown up in association with the travail of the mining industry, have for many years been profoundly concerned with the long chain of consequences. We therefore welcome the provision for the reimbursement to the National Coal Board of the social costs of contraction.
But, while the Government have every right to claim that redundancy payment schemes have alleviated the social consequences, I shall always remain convinced that no redundancy scheme, however generous, will ever solve the real problem. That can be solved only when adequate and suitable employment is provided for the men who are displaced from the industry for ever more. I do not want to go over the old ground but, as the hon. Member for Bournemouth, West (Sir J. Eden) said, there is nothing new in pit closures. I am glad of the enlistment of some sympathy in that respect.
I must reiterate that for years we have argued very strongly from these benches that, if the acceleration of the rundown in manpower continued, such pressure on the industry would not only bring about a situation in which supply of fuel would not meet demand but it would also produce even more serious economic and social problems through having to maintain men who just cannot find work. What it means in human terms is that it is becoming more and more difficult for these men with their families to find jobs in mining or elsewhere. With this in mind and trying to offset any further serious effects, I congratulate my right hon. Friend with his undeniable alacrity of mind on giving serious thought to and coming to certain decisions. He deserves great credit.
792 As the House knows, the Coal Industry Act, 1965, made provision for meeting from the Exchequer part of the cost of the benefits provided by the National Coal Board in respect of the social costs involved in the course of contraction of the industry. Those social costs were defined as payments made in respect of redundancy, loss of superannuation and employment prospects, removal and resettlement expenses, including housing, subsidised transport, and supplementation of earnings for men who were transferred. As my right hon. Friend has pointed out, under the 1965 Act payments were to be made in each year up to 1971 of half the Coal Board's expenditure in excess of £3.8 million, subject to a total limit of £30 million.
We felt much more content when the 1967 Act altered the level of assistance to two-thirds of the Board's expenditure in any year, subject to a total limit of £45 million. However, it should be noted that payments under that scheme for 1968–69—which incidentally produced the alarming rate of pit closures with manpower falling from 325,000 to 298,000—the expenditure incurred by the Coal Board was £16.6 million and payments made by the Ministry totalled £13 million, resulting in the cost to the Coal Board of £4.6 million. Therefore, it is unlikely that the statutory limit of £45 million for the period after 1971 will be exceeded. It may be that the worst is thought to be over in respect of heavy pit closures and high rundown of manpower and that we are no longer in the position of previous years when collieries were closing at a fast rate.
While it is unlikely that coal output targets will be set for any future period as being the contribution needed by the coal industry towards national fuel requirements—by taking an objective view that there will be a demand for coal that can be mined at sensible prices—we advance the view that any announced policy of closures should be restricted to pits which are grossly uneconomic, either due to exhaustion or geographical factors by which we could expect a much milder programme of closures for the remainder of the year. In giving earnest consideration to the Bill we attach great importance to the measure of extension of power to compensate electricity generating boards for the use of coal instead 793 of other fuels. In 1968–69, the first full year of the scheme's operation, some 7 million extra tons of coal were burned—nearly all in the power stations of the Central Electricity Generating Board and the Scottish Electricity Boards—at an estimated extra cost of £11.3 million.
This is an achievement which dramatically demonstrates the way in which our station coal consumption has been climbing since the war. It puts into proper perspective recent announcements about the conversion to oil-burning of certain small power stations which have been burning coal under the Government's measures to support the coal mining industry during the period of contraction. As my right hon. Friend mentioned, the task of meeting such a demand for coal had to be met from ground stocks, and more than 10 million tons of coal have been lifted in the past year alone, sometimes averaging 150,000 tons a week. Stocks are now depleting, and that means that it will take a tremendous upswing in productivity to secure stocks. It used to be argued that coal production should be curtailed to stop more stock-piling, but as I see the situation the inconceivable has turned conceivable.
In passing, it is remarkable to think that in 1950 coal consumption at power stations totalled 33.5 million tons and within 12 years had increased by 20 million tons. This year's coal consumption by the Central Electricity Generating Board is expected to be about 69 million tons, more than double the quantity used 20 years ago.
Those of us who represent the mining industry are very glad that my right hon. Friend announced his decision on the giant Tilbury B power station to burn about 3 million tons of coal a year, instead of its being converted to oil. We look upon this decision as the turning of the tide because, if I understand the marketing position correctly, coal produced from Durham and Northumberland coalfields will supply this station when it is working at full capacity.
Some of the mines in Durham and Northumberland are amongst the most efficient and profitable in the whole of Britain. The seams are thicker and easier to work than in many parts of the country. The National Coal Board has projected into the mid-1970s the increase in productivity now being achieved at 794 these collieries, and as the nation has invested a great deal of money in these pits through expensive machinery, development and reorganisation, not only is the area fortunate in having enormous reserves of coal in many cases running under the sea, but there should not be any doubt that these collieries should be regarded as a great national asset. As a consequence, we appreciate how my right hon. Friend considered the very serious implications in the event of abandoning the potential output from these collieries for the sake of financial savings that might or might not accrue from Tilbury B power station being switched over to oil.
It is worth mentioning that about 12 years ago Durham and Northumberland coalfields supplied 9 million to 10 million tons of coal to gasworks, but, as these have been converted to oil and now North Sea gas, the tonnage supplied has steadily declined to almost nothing. I suppose that it is one of the reasons, which one can understand, why the power to compensate area gas boards will cease at the end of March, 1971.
But we look upon the market of Tilbury B as a welcome replacement which we hope will bring about a better turn of economic fortune by bringing to an end what has been a complex and harassing situation, and that manpower can be established at an acceptable level. It is good business for the nation too that such trade should go to such an area that has had more than its share of pit closures. It will not only safeguard the jobs of mineworkers and raise their morale, but will also save the public funds that would have been needed to ward off the ravages of unemployment. Equally, for economic reasons, it will also lift up the spirits of business and commercial associations that have been established in and around the mining communities.
Even though the National Coal Board and the National Union of Mineworkers have faced many vast problems of uneconomic pits, redundancies and redeployment, it is encouraging to learn that boom conditions for coal are being experienced in the iron and steel market, where sales of coking coal in the 1970–71 financial year are expected to be 1 million tons higher than in the current year, which is 25½ million tons, and is the highest for 795 four years. As a matter of interest, the British Steel Corporation, which is the main user of this coal, produced more crude steel last year than ever before, and, with plans to extend substantially two major works in South Wales and Scotland during the next few years, the higher level of demand is expected to continue, despite increasing efficiency in the steel-making process.
It is with such industrial activity in mind that I am pleased to say that Durham and Northumberland coalfields produce about 6 million tons a year, of which 3½ million is sold to the British Steel Corporation, about 500,000 tons go to the independent ovens of Ford's at Dagenham and 2 million tons to the Coal Board's own ovens.
It is most unfortunate that reserves of this type of coal are rapidly dwindling, and it was feared that a serious shortage would develop. But fortunately an important technological development has taken place. The problem has been solved by the development of scientifically-controlled blending techniques, which will enable previously unsuitable Durham coals to be used for the first time for the manufacture of foundry coke. The coals are blended with small amounts of finely-crushed coke breeze and low-volatile Welsh coal. Such a process is expected to preserve the important foundry coke sector of the iron and steel markets.
For many years Durham has been the backbone of the British iron foundry industry, simply because the coal seams in the west of the county contained a particular kind of high-quality coking coal, which was suitable for the making of specialised foundry coke, but as these seams are almost exhausted the National Coal Board is pioneering the development of new blending plants in Durham county. This is evidence of how coal can be utilised not only for the benefit of other industries, but also on behalf of the nation.
I would regard the building of a new blending plant in my constituency at Derwenthaugh as a major step forward, not only to provide employment for constituents but on a much greater scale to enable the National Coal Board to ensure that 2,000 British foundries will get their supplies of foundry coke for the process of making castings for the car industry, agri- 796 culture, the railways and domestic appliance manufacturers. We hope that this will be the means by which hundreds of thousands of workers will maintain their employment in their respective industries.
For these reasons, more so in the sphere of the improvement in the industrial market, where sales of coal have declined in recent years, I wish to commend my right hon. Friend for bringing forward the Bill. We hope that it will give the National Coal Board an opportunity to provide the fuel that the nation will need for many years to come.
§ 5.28 p.m.
§ Colonel C. G. Lancaster (South Fylde)
If I do not follow the same course as the hon. Member for Blaydon (Mr. Woof) it is because I want to deal specifically with the Bill.
The Select Committee on Nationalised Industries considered the two Acts of 1965 and 1967 during the last Session. The Bill before us originates in considerable degree from the evidence taken then and included in the report submitted to the House on 20th October last year. Sub-Committee A of the Committee prepared the report. Its Chairman, the hon. Member for Poplar, (Mr. Mikardo), is unable to be here, and has asked me as his deputy to speak on behalf of the Sub-Committee. I hope that what I say will commend itself to the members of the Sub-Committee, who worked for a year on the problem.
There are a number of questions I want to put to the Government Front Bench and I am sorry that neither the Minister of Technology nor the Paymaster-General is here. These questions are the result of a year's hard work by an all-party Committee and I would have hoped that, when the time came to ask them, and pursue matters which were given very great attention, involving the taking of evidence throughout the country, there would have been one or the other of those Ministers present.
The Joint Parliamentary Secretary to the Ministry of Technology (Mr. Alan Williams)
The hon. and gallant Gentleman may accept the fact that in the Department I deal with the nationalised industries, along with my right hon. Friend the Paymaster-General. I am perfectly capable of noting the questions he asks and passing them on to my right hon. 797 Friend who will certainly deal with them, if he has time, in the winding up.
§ Colonel Lancaster
I expect that I can take some satisfaction from those remarks, but I still feel that it would have been more appropriate if one of the Ministers had been present. There is one minor matter in Clause 3 of the Bill which I will raise at once, and which is to do with the deferment of the closures of pits. We did not oppose this happening; it was a humane matter. What we were deeply concerned about was the cost. This was in great measure due to the fact that it was imposed on the National Coal Board.
It formed no part of the Board's productive arrangements and as a result there was a loss of no less than £4 10s. on every ton produced by those deferred pits. The powers under the new Bill allow this again. Again, under certain circumstances we are not opposed to that, but we are opposed to it happening under the circumstances in which it happened on the last occasion. If it needs to be done it should be done through close consultation with the National Coal Board so that it can combine that with its general productive methods and do it at a much lesser cost.
A more important point is to do with Clause 2, relating to redundancy. We took a great deal of evidence about this. We spent the major part of our inquiry looking into redundancy, re-employment, retraining. That was the major purpose of the Committee's work. We came to certain conclusions about redundancy. It was laid down in 1967 that redundancy would occur when a miner had reached the age of 55 and over. We paid careful attention to that fact. We listened to the National Coal Board, which not unreasonably said that it would sooner make older men redundant, thereby enabling younger men to step up the ladder of promotion more quickly than would otherwise be the case. We were not wholly convinced that the argument was sound.
We were told, and many of us knew, that with the introduction of power-loading and other machinery, a man aged 55 could still do good work for a number of years. While in the past it had been a great physical effort for him when he reached middle age, today he could continue to work. If it is decided that men are to become redundant at 55 what is 798 the prospect for the younger man? It will be merely that he will go on to the age of 55 and will find it immensely difficult to get work outside.
We feel that, if redundancy is necessary, a proportion of the younger men should take the opportunity of going elsewhere and finding employment, and that a reasonable proportion of the men aged 55 should continue in work. We looked at the evidence of 20,000 men of the age of 55 who were made redundant. Only 1,000 found work of a kind to affect their redundancy pay because of other earnings. That meant that 19,000 men were put on the scrap-heap. Many of them had several years of useful work ahead of them in the pits. I should like to have a reply on that point from the Minister.
Clause 1 deals with reimbursement of expenditure to the National Coal Board in relation to redundancy and redeployment. It appears that under the Bill this will be phased out over a short period. Two-thirds of the payment will be made in the first period, one-half in the second period and only one-third in the third period. This brings me to the conclusion that the Ministry may be of the opinion that by 1974 the industry will be on an even keel. It is not an unreasonable assumption. That would mean that it had had 10 years to modernise, and that in all the circumstances was not unreasonable. If, on the other hand, the Ministry has other views it may be that we shall be confronted with yet another of these Bills.
We never got a clear answer about manpower requirements. The figure of 10 per cent. was always trotted out and we found it impossible to discover the basis of that figure. It was not really very relevant to take a national figure. The figures in certain parts of the country were so high, while in others there was actually a shortage of manpower, that we could not take a national figure. We were by no means convinced that 10 per cent. was necessarily the right figure to aim at.
§ Mr. Lubbock
Is the hon. and gallant Gentleman telling the House that in the period covered by the Bill the National Coal Board told his Committee that it expected a reduction of 10 per cent. in its labour force in each of those years?
§ Colonel Lancaster
No. What the Board did was to suggest that an amount greater than 10 per cent. would present it with an intolerable situation and therefore it aimed at that figure. We never got a very clear answer as to how it reached that figure and that is something that I should like the Minister to comment upon.
The burden of the evidence before us was that it was the intention to produce coal in the most economical parts, such as the East Midlands and South Yorkshire coalfields. I take it that is the philosophy behind the Bill, and that only by producing coal in the cheapest, most efficient manner, can we hope that coal will retain its present position. The necessary corollary of that is: are there the necessary reserves in these coalfields to go on with this intensive production? In the old days when the demand for coal was high and production was pressed on with, the reserves became an important factor. They still are.
We took 95 per cent. of our evidence upstairs in a Committee room. There came a day when we went down and looked at an area in Yorkshire, which I will not name, but it is considered to be a very good area. We took evidence, in the course of which the man who is now called the area director told us that one of his pits was being phased out but he could take up the lag of production in his other 11 pits. He was asked if he was happy about his reserves, and he said that he was. He was then told that he was a very fortunate man, and he said, "Yes, I am excessively fortunate". Within a month of that conversation, no less than 14 deep bores were asked for by that area. If I may explain to my hon. Friends, deep bores are not primarily for research, they are bores from one seam to another of known reserves, but are nevertheless important from a reserve point of view. That is why I asked this question about the East Midlands and South Yorkshire and the areas from which most of our intensively mined coal will come.
I must declare an interest in this. For the last 25 years I have been connected with the foremost geological firm in the country working in these matters. I speak with some experience.
We now come to perhaps the most disturbing and vexed aspect of the situation. 800 We took evidence from Lord Robens about the projected production over a period up to 1975. We were told this afternoon that the last two years prior to this year had shown very satisfactory increases of about 8 or 9 per cent. Lord Robens told us in March of last year that by 1975 he expected to reach productivity of 75 cwt. per man, and he used the phrase, "We have made the most scientific assessment of this problem". His immediate intention for the current year was to reach 51 cwt. Within a month of our reporting, the evidence before the National Board for Prices and Incomes was that it would be 47 cwt. and not 51 cwt.
At this moment, the 75 cwt. by 1975 became an impossibility, and that is why the serious position, which was dealt with shortly by the Minister of Technology, has arisen, and why the Committee is deeply disturbed. We formed a number of our conclusions on the very persuasive evidence which Lord Robens gave to us and which, within a short two months, was negatived by evidence before the N.B.P.I. Many of our conclusions were, therefore, put into a false perspective.
It has been suggested, and I believe Lord Robens has said, that this recession in production was because the very sophisticated machinery which is being used had made such advances that management had not had the time, or the good sense, to drive headings and roadways and lay out new faces to take the place of the areas being worked out. Anybody who will believe that will believe anything. This is not the first year in which there has been mechanisation. The East Midlands area was heavily mechanised before the war. By 1942, power-loading had been introduced. The present colliery managers and under-managers were trained under conditions of mechanisation and, living with mechanisation as they do, it must be assumed that they are able to project their plans forward in line with the increased pace of the more sophisticated machinery. To say that this has occurred because they have been caught short in making their forward plans is a drastic condemnation of management itself.
Lord Robens in evidence said, "If we fall down on this, it will not be the men, it will not be the machinery, it will be management." But, by Jove, they have 801 fallen down. All the conjectures we made were based on what we thought was sound evidence, but this is tumbling to the ground.
What will happen to the modest financial requirements which have been made of the National Coal Board, whose target is no more than to break even one year with another—a smaller target than that presented to any other nationalised undertaking. As a result of this shortfall in production, the target will not be met, and there will be a large deficit at the end of this year. Who will be blamed for that—the men, the machines, the pits, management? I do not think that it is the colliery management and technicians who are to blame but those much higher up, and this is a serious situation. Once again, I wish the Minister could hear me saying this and give me an answer.
I have made a somewhat sombre speech, but I have tried to be realistic. I have asked some questions and I have shown, I hope clearly, that in certain directions the present position is a very serious one. We are falling down on production at a moment when, at long last, production is needed and there is a big demand for coal, not only in this country, but abroad. If we had adequate supplies, we could be pushing on with our exports, as I have always wanted. Coke is in tremendous demand; we could send it anywhere, at any price, if we were producing it, but we are falling down on production, and even the modest target with which the Coal Board has been presented will not be reached.
I do not want to be altogether despondent. Fundamentally, I have always been a great believer in the coal industry. In China, east of the Iron Curtain and in the United States coal production is going up, and I believe that it will go up again one day in this country. But it will go up only if we produce it at the right price, if we produce it as efficiently as it can be produced, if we hurry on devolution, if we make the best use of the very good management which we have and if we give a chance to the best colliers in the world to do what I know they can do.
For a great many years I have spoken on coal, and the House has always listened kindly and patiently. I think 802 that this is the last occasion on which I shall ever speak on coal and, therefore, I want to end on a happier note. If we tackle this industry properly, the time will come when those who are engaged in it will once again be proud of the industry. We have the reserves of coal which we need, we have first-class technical management of all grades and we have the best colliers in the world—I have worked with them, I have gone to war with them, I know them and I know that to be true. Based on that secure foundation, I hope the day will come when King Coal once again will rise to his throne.
§ 5.59 p.m.
§ Mr. Harold Finch (Bedwellty)
I have listened with deep interest to the speech of the hon. and gallant Member for South Fylde (Col. Lancaster). I always do when he speaks in mining debates, because I know of his wide knowledge of the industry and the great interest which he has taken in it over the many years in which I have been a Member of Parliament. I feel sure that the Government Front Bench will take notice of many of the important points which he raised in his able speech. I want to congratulate him for time and time again giving us the benefit of his practical knowledge of this industry.
As my right hon. Friend the Minister of Technology explained in opening the debate, the provisions of the Bill seek to renew financial aid to the mining industry arising out of contraction. I say at once that there is not a body of men and there is not a community of people in this country who have suffered so much and who have borne the brunt of economic change so much as those connected with the mining industry over recent years. The people connected with the industry have faced up to the changes in the same spirit and with the same courage as those employed in the industry face the hazardous nature of the undertaking.
Let us look at the position. I am one of those who believe that although we should congratulate the Government on again renewing their aid to the industry that that aid is not sufficient. Since 1967, when the last Bill was before Parliament, there have been 140 pit closures and manpower has declined from 410,000 in 1967 to 296,000 now. What staggering figures 803 these are for the loss of manpower in an industry over a relatively short period! It may be that there is nothing like it in the industrial development and history of the country.
At the same time, the output per man shift in those pits left in the industry has gone up. It is true that last year the position was not quite so satisfactory, but, nevertheless, the output per manshift has been increased, and that is a great compliment to the men in the industry. It must be remembered that pits grow older and it is not always easy to keep up the same output in the old pits as in the newer pits. Year by year these pits are gradually growing older and difficulties have to be encountered which reduce the output per man shift. But, by and large, the output has gone up.
Now we are rightly saying in this debate—and I agree with it—that we are suffering from a coal shortage. That is the position which we are in. We are running short of coal, particularly coking coal, and the Coal Board and the Government must make a choice in this debate. I want the Government to make up their mind today whether they will continue to close pits which are uneconomic, with a further loss if they do and with serious consequences to the steel industry and industry generally and, indeed, to the domestic consumer.
The Government have one of two choices. They can keep pits open even if they are uneconomic, or they can close them, with the serious consequences which will arise. Our trouble today is that there has been too rapid a closure of pits and we are finding ourselves with a pit shortage. For the 51 weeks ended in March of this year—and I have not the figures for the last week—the total sales of coal were 159,419,000 tons. Production was 144,577,000 tons, and that includes 6½ million tons of open-cast coal.
So, at the moment, we are lagging behind in production and eating into stocks. If this goes on, with winters like the one we have had, it will be serious for industry. This has been due to a too rapid closing-down of the pits. [AN HON. MEMBER: "We warned them."] Yes, we have warned them. We have told them so on this side of the House, but they would not listen. I know that some 804 of the pits are uneconomic and that, as there is a coal shortage, they can be kept going. The Bill is seeking to give some assistance to the industry in that respect.
This is what we must decide. I should like an assurance that the Coal Board will not close any more uneconomic pits for the time being, having regard to the serious consequences which might arise from coal shortage. I hope that we shall have that assurance from my right hon. Friend.
My other point is the financial assistance which is being given by the Bill in the present circumstances. We know that under the 1967 Act the Government are carrying out their promise that they would pay two-thirds of the total expenditure in the industry arising out of contraction. But it is to be noted that in the Bill the figure will be two-thirds for the first year, one-half for the second year, and one-third for the third year.
The figure is, therefore, being reduced and we shall not get the same proportion in the coal industry as before. The Bill reduces it to what it was before the 1967 Act. I ask my right hon. Friend why there should be this reduction. It will be said that the Government do not anticipate so many pit closures. That is very good, but it means less expenditure for the Government and in those circumstances I do not think that it is too much to ask—having regard to the loss of manpower and the closing of pits in years gone by—and in view of a large reduction in expenditure due to social consequences which we hope will be the position in the near future, that this position should be looked at in Committee. I hope that the Government will agree to meet the total expenditure for pit closures in these circumstances.
Then there is the question of redundancy payments. Here again, the redundancy pay scheme provides for payment for those aged 55 and over for three years. We shall find that many of those men will be leaving the industry at the age of 59 or 60. There is a lot to be said for what the hon. and gallant Member for South Fylde said about many men of 55 being able to continue to work after that age with industry highly mechanised at it is today.
But be that as it may, the present Bill provides for redundancy payments for a 805 period of three years. Men will, therefore, now be leaving the industry due to redundancy at the age of 59, but they do not come on to a retirement pension until they are 65. What will they do, therefore, between the ages of 59 and 65? Once the redundancy payments cease their only recourse is to a form of supplementary benefit which comes under the form of a means test. That is their fate at the age of 59 or perhaps 60. They must wait five years and during that time they will be on the means test, on supplementary benefits.
This is not a fair reward for men who have spent a lifetime in the industry. While I appreciate that we have made advances with redundancy payments and the provisions of the Bill as it stands, it is not a sufficient reward for men working in the depths of the pits to finish at 59 and to go on to a form of supplementary benefit until they reach the age of 65.
I know that we have made these advances, but I beg my right hon. Friend to seriously consider in Committee extending these redundancy payments for our older men until they become 65. I agree with the hon. and gallant Member for South Fylde that many of them would be prepared to go on working after the age of 55. They will do and I believe that in many cases they can do. But where they are compelled to finish at the age of 55, then I ask the Government to seriously consider extending their redundancy pay until they become 65. Redundancies of the age group 55 to 59 under the scheme are standing at 23,000, of whom 1,681 have found other work. Age is the problem.
§ Colonel Lancaster
The evidence is even worse than that. We found that, out of 20,000, only 1,000 had found employment. That is even worse than the hon. Gentleman is mentioning.
§ Mr. Finch
Perhaps I have not completely up-to-date figures.
It is difficult for men at 55 to get jobs once they have left coal mining. Often, men over the age of 45 are not wanted. In South Wales, I have known men declared redundant at 40 or 41 who have been refused jobs at factories because the management say that they cannot take on men of that age. This factor must be seriously considered when dealing with the problems of the industry.
806 Another factor is the rate of payment of redundancy pay. Under the Act, it is based on about 90 per cent. of their wages. But many men do not get 90 per cent. Many single men do not. A lot of men get less. I hope that, in Committee or in consultation with the N.U.M. on the redundancy scheme, the Government will bear in mind some of the anomalies. Redundancy payment is based on average wages, but how does one arrive at an average?
A man may have been sick in his final year for perhaps five or ten weeks, but the divisor is still taken as 52 weeks and not as 42. The result is that the average is down. If a man normally earns £18 to £20 a week, but loses eight or 10 weeks of the year through sickness, the amount of redundancy pay is less because his average over the year has gone down because of the sickness period.
In Monmouthshire, we have councillors who have given years of public service. There is in my constituency a miner who was chairman of the local authority just before the redundancy scheme came in. We have county councillors who have lost perhaps 10 or 12 weeks' work through public service, but the divisor for their redundancy pay was still 52 weeks. I know several public representatives in my constituency who are getting only a few shillings under the redundancy scheme. These are some of the anomalies which I hope will be considered when drafting the new regulations on redundancy.
Another factor is the hardship allowance for an injured man under the Industrial Injuries Act. A special allowance is paid to a man who has been so seriously disabled that there is a difference between his pre-disablement earnings and his light work earnings. The increase in hardship allowance is taken into consideration when assessing the 90 per cent. redundancy pay. For example, if the redundancy pay would have been £7 13s., the increase in hardship allowance is taken into account and the payment is reduced from £7 13s. These anomalies are causing dissatisfaction among redundant men.
I mention these points for the consideration of my right hon. Friend. I am sure that he will seriously take account of them when the regulations are being 807 made. I emphasise again that the problems to do with the shortage of coal are due largely to pit closures, which have been too rapid. The process has gone on at too great a pace and now we are in this serious situation.
I do not know why it has to be published, as is done in South Wales, that a pit is on the jeopardy list. The men come up from the pit and see a statement that it is on the jeopardy list. The young men say, "The quicker we get out of the industry the better. It is insecure. We had better find work somewhere else." Would it not be far better to consult the N.U.M. before publishing statements about pits being on the jeopardy list? I am sure that the union and the Coal Board are quite capable of going into these matters before men are frightened out of the industry.
I agree with the hon. and gallant Gentleman that, with fewer pits and increased output per manshift, coal is still required and will continue to be required for many years and that we can still make the industry a great one making a great contribution to the economy. But it can only be done in a spirit of co-operation and by giving something extra to the Coal Board to tide it over the difficulties—and it must be something more than is contained in the Bill. Otherwise, the Bill is welcome.
§ 6.16 p.m.
§ Mr. Keith Speed (Meriden)
The debate has been marked so far by a remarkable degree of unanimity and knowledge on both sides of the House about the problems and difficulties of one of our great industries. The question of pit closures is very close to me. On the day of my by-election, just over two years ago, one of the pits in my constituency, Arley, closed, and three or four months later Kingsbury Colliery closed. Many men in my constituency who were made redundant then are still unemployed. So, as a comparatively new Member of the House, I have seen the problem at first hand. In the Warwickshire coalfield, output per manshift is between 60 and 75 cwt. It is very high. The South Midlands coalfield is one of the leaders in productivity and production.
In a debate of this kind, one should look at the future of the industry. I 808 support the eloquent plea made in his maiden speech by the hon. Member for South Ayrshire (Mr. Sillars), and in an intervention by my hon. Friend the Member for Honiton (Mr. Emery), for up-to-date figures on the 1967 White Paper on Fuel Policy. We should at least get these even if de do not get a new White Paper. The present situation is like catching a train in 1970 on a 1967 Bradshaw, because so many things have changed. For example, there is the dual firing of power stations, while certain opencast applications have been granted, although others—I am happy to say, one of them in my constituency this week—have not been granted. So many things are changing and one cannot have a proper debate on out-of-date figures or on the comparatively few figures given by the Minister.
The problem being faced by the industry is that demand has overtaken production. I agree with my hon. and gallant Friend the Member for South Fylde (Col. Lancaster) that the higher echelons of management in the Coal Board have a degree of responsibility for this because they got their productivity and production and, I believe, their marketing sums all wrong—and, unhappily, all wrong at much the same time.
This is a difficult situation, as we can see today, when it is snowing, although we are well advanced into April. This means a market demand for coal. It is always a difficult matter. If we had had a milder winter, or perhaps spring had come at the beginning of March, we might not be in such severe difficulties. But we shall be in them again next winter, with the supply of coal below demand, unless urgent steps are taken.
Is the pace of change in the pits decided upon by the highest echelons of management sufficiently quick? Recently, I had the opportunity of seeing in one of my local pits the retreat mining method of coal extraction. I believe that I am correct in saying that at present about 22 per cent. of all collieries now employ retreat mining compared with the traditional long wall type of mining. I am led to understand that the retreat mining operation gives marked advantages in productivity. in raising the output per manshift. But if this is so, why are we so far behind certain other countries 809 abroad which have been using this type of operation for a very long time?
§ Mr. Ogden
The answer is a simple one. It is necessary to lay down the programmes and planning years ahead; and forward planning is not productive. If one has to meet financial targets with an economically marginal pit one has to have production coming day after day rather than putting production in for long-term forward investment. That is the difficulty.
§ Mr. Speed
The hon. Gentleman has almost anticipated what I was about to say.
So far as the components and machinery used in the pit, the cutting equipment, and so on, are concerned, there are production problems on that score which lead me to believe that over the past few years sums have been done wrongly. Now we are beginning to have to pay the price. Certainly, in Warwickshire, retreat mining is going ahead. Birch Coppice is the first to have it. There is an experimental system which is to be extended. Other collieries in my area are to have retreat mining introduced as soon as possible. This outlines the problems with which we are dealing.
This is tied up with the problem of confidence and morale in the industry as well. It is certainly true that neither retreat mining nor any other means of securing a fantastic increase in productivity will be the complete answer; because another thing that worries me is that unless we can also get the marketing policies of the Coal Board right we could find ourselves having a productivity and production break-through but in two or three years' time could find that markets have not been developed. Again, there may be problems of the higher echelons of management. Unless they are very wise, they will not develop the new markets which we should need if there was a major break-through in productivity.
Unless we get such a break-through prices will rise again, making the position of the whole industry that much more difficult. As far as the question of new markets is concerned, we have heard a certain amount about the fluid ice-bed combustion process for boilers; those who read Coal News and talk to their constituents about this will realise that 810 this could be a remarkable technological break-through for using coal extremely efficiently in small boilers, in a very advanced state of combustion for power stations with a total fuel system and anything else. What has happened?
There was a lot of publicity on this a few months ago, but now there seems to be a hush. Is development going on by the Coal Board? Is there to be a great break-through in the 1970s for new markets? It might be helpful if the Paymaster-General could give the House his ideas on this; because if the advance publicity and some of the things that were said about fluid ice-bed combustion were to be even 50 per cent. true, that could have a most dramatic effect on markets for the coal industry in the 1970s.
In discussing a Bill of this kind we should be aware of the possibilities. My hon. Friend the Member for Newcastle-upon-Tyne, North (Mr. R. W. Elliott) spoke about smokeless fuels. As far as the home fire story—"Bronowski's bullets"—is concerned, in my constituency undoubtedly it is true that had the home fire plant come up to the very optimistic statements that were made by certain members of the Coal Board two or three years ago—in 1963 to my predecessor and two years ago to myself, shortly after becoming a Member of Parliament—there would not be, nationwide, the desperate shortage of smokeless fuels that there is today. There have been technical problems, but it is time we knew whether the home fire is to be wound up as a process of ground heat, and whether room heat will take over.
All this is germane, because a number of my local pits, and particularly Newdigate, are now being merged into other collieries and their future is obviously tied up with the viability of this plant and of the smokeless fuel process. Therefore, it would be helpful to have some information on what is happening, not only in the great national interests, as outlined by my hon. Friend the Member for Newcastle-upon-Tyne, North, but having very much relevance to the Bill and to future demands for coal not only from collieries in my area, but from others.
I turn to Clause 12 of the Bill, and particularly to the question of the scheme for redundant mineworkers, mentioned 811 by the hon. Member for Bedwellty (Mr. Finch). I do not feel that this scheme has been explained in sufficient detail to many of those taking part in it. I do not say that that has been done deliberately, but I have had many cases, and no doubt other hon. Members have, too, where men of 55 to 60—that kind of age—have retired under the scheme fully expecting to get 90 per cent. of their pay.
The whole of the publicity said that that would be the redundancy payment; but they find that because they have a wife who is drawing a pension or is working, or because of some other circumstance, they are treated as single persons for social security purposes and that, instead of receiving 90 per cent., they receive only between 60 and 70 per cent.
I had long and involved correspondence with the predecessor of the right hon. Gentleman the Minister on this and at the end of the day got nowhere because apparently this was the way the scheme was laid out. I suggest that not all my constituents are fools or trying to milk the last pound from the Coal Board. It is clear that many of them, for one reason or another, were misled. I read the publicity issued by the N.C.B. when the scheme was introduced and to my mind it was not spelt out nearly clearly enough. So, instead of being a great scheme which could have helped, as it has done in many cases, it has left many of my constituents and other ex-colliers all over the country with a trace of bitterness. People have said that they have not received what they had expected.
There is the further point of entitlement coal. A man who is made redundant under the scheme at the age of 57, 58, or 59 finds that he does not get his entitlement coal although he may have been in the industry for 40 or 45 years and given his working life to it. Yet another man who may have come into the industry comparatively few years ago and who retires at normal age will get the full entitlement which is always rightly regarded as a perquisite of the industry. This is something which should be looked at. In fact, we are penalising these men.
It is certainly true in North Warwickshire, where we have had above average 812 unemployment for a number of years, that it is virtually impossible to place in alternative employment a man who has retired voluntarily under the redundancy scheme. Many of them have great wisdom and experience and are used to the rigorous disciplines of the coal industry; and they would be first-class in spending their remaining working years of life in some other industry; but partly because of the economic circumstances, though principally because of age, it has not been possible to place them in employment.
I would certainly hope that the scheme could be extended to the normal retiring age of 65. This is one action by itself would do a tremendous amount to encourage men who are worried and frustrated by having little hope of finding alternative employment although they are very able-bodied and would be prepared to take on whatever work was offered.
Clause 7 of the Bill extends the powers of the National Coal Board to search for and extract oil and natural gas. My hon. Friend the Member for Bournemouth, West (Sir J. Eden) dealt with this in his speech. I must confess I share his reservations about this particular Clause. Leaving all the natural party political differences between the two sides out of it, one of the things that worries me is that at present the Coal Board has so many great problems of planning, production planning, new technologies and new marketing and markets that I would be very loath to see introduced anything which would divert it or its top executives from that main aim.
To give an example of what I mean, hon. Members who have a coal mine in their constituency will know that one of the remaining functions of the board which has nothing to do with mining is being a considerable landlord of housing. I do not think that I am being unfair to the board in saying that as far as my constituency is concerned it is not "top of the pops" as a landlord. That may be due to all kinds of reasons but I know, as I suspect others know, that the Coal Board is not always as desperately eager to carry out repairs and dilapidations as some local authorities and some private landlords are. Apparently it works on allocated funds for repairs quite apart from whether or not repairs are necessary.
813 A number of months ago I had problems with the Coal Board involving the sale of a large estate in my constituency to a private developer, which was eventually settled. If under Clause 7 of the Bill the board intends to extend into other matters, if it wishes to dig around in the North Sea for natural gas and oil, or whatever it may be, this draws it away from its main aim. This should be the highly efficient management of the deep mines and long-term production planning and co-ordination of its marketing policy, which over the last few years has not gone as well as some of us hoped.
I believe that the Bill is an essential interim measure. Like my hon. Friend the Member for South Fylde, I am optimistic in the long term about the future of coal. There will be a number of interesting, exciting technological breakthroughs which will ensure a ready market. What we have now to do for all those engaged in the industry, at whatever level, is to try to restore even further the confidence which, in many cases, is now beginning to come back as they see the great stockpiles are being reduced. In Warwickshire, 2 million tons of coal were stockpiled. This figure has now fallen dramatically.
Challenges are being made and those engaged in the industry can see the new technologies involving retreat mining and all the rest. Many men in the industry feel that, given a fair wind, there is a tremendous future for them. The Bill will carry on the interim protection afforded by earlier Bills in this difficult changeover period. If the Bill is passed—and there are a number of useful amendments on redundancy payments—then we will have bought time for the mid-1970s when we can genuinely say to young persons. "There is a real and prosperous future for you in coal mining."
I conclude by saying a few words about the men in the industry. It has, of course, been a difficult time for them with coal mine closures, and so on, in a contracting industry. I take the point that was made about jeopardy notices put up at pits. It is extremely unfortunate when a young man comes down from Durham or Scotland, because pits have been closed there, to find work in a pit farther south, he is assured that his future is secure and then finds that that pit is due to close. A 814 young man in his twenties, who is looking for an interesting career which could mean a lifetime of service in a great industry, will not be encouraged by such a situation.
We have reached the stage when the whole matter of coal mine closures must be looked at carefully. We shall almost certainly be short of coal. The question of technology and marketing must be examined carefully. We must pay tribute to the unions, the managers and men who have carried on the job in past years in extremely difficult circumstances. I am an ex-seafarer and was in the Navy for a number of years. I believe that the disciplines and dangers that beset seafarers are echoed among people who work underground in the mines. They call for much the same sorts of qualities.
I believe that the Bill will give further interim support to the coal industry. The ball is clearly in the court of the Coal Board at the highest management level to make sure that it does not lose the opportunities which are being provided by Parliament to transfer the coal industry so that it has a wonderful future in the 1970s and 1980s.
§ 6.35 p.m.
§ Mr. Alex Eadie (Midlothian)
I am not quite sure whether my remarks will contribute to the unanimity of debate which has been evident on both sides of the House so far. The hon. Member for Meriden (Mr. Speed) talked about the new technology of retreat mining. It is certainly not new. We have been carrying out retreat mining in the mining industry for 30 years, to my own knowledge.
§ Mr. Eadie
I do not know whether the hon. Gentleman wants to make another speech to remedy what he said. I was pointing out, as an experienced miner before I came to the House, that retreat mining has been practised all over the coalfields for 30 years.
815 I was pleased that my right hon. Friend the Minister of Technology introduced the Bill. This is the first opportunity that some of us associated with the mining industry have had of hearing my right hon. Friend on this subject. Frankly, when the new Ministry was introduced I felt that I would have preferred to see the new technique of tying all these administative matters together at the beginning of a Parliament rather than towards its end.
Although both my right hon. Friends the Minister of Technology and the Paymaster-General were here earlier, they have been in the House very little during the course of the debate. They have come and they have gone. I am not trying in any way to cast aspersions on my hon. Friend the Joint Parliamentary Secretary who is now sitting on the Front Bench. But I am trying to make the point that this is a new industry and many of us felt that the power industry would not receive the attention that it used to receive in the old Ministry of Power.
§ Mr. Eadie
I do not need any help from hon. Gentlemen on the other side of the House. I am not making any criticism; I am stating a fact. My right hon. Friend the Minister of Technology knows that we have already had some discussions on this matter. I will leave it at that. I still think it is very bad.
I reserve my judgment about the new Ministry of Technology, although I have reservations. It will have to prove to me that it will give the proper attention to this great power industry which we are debating this evening.
My right hon. Friend said that this was an important Bill and that he doubted whether it would be opposed. I agree that it is important, and I do not think that it will be opposed; I think that it will be supported. It is significant that there is now talk of a crisis of manpower in the mining industry. Mining has reached the situation where consump- 816 tion is outstripping production. We are entitled to tell our Front Bench and, indeed, right hon. and hon. Gentlemen opposite that for a long time, inside and outside the House, we have had to put up with a continual defamation of coal and coal miners on the problems besetting the industry. We are now entitled to say that we warned the House and the country of the situation that would ensue following a policy of pit closures and as a result of pursuing wrong policies set out in a White Paper that was never really debated in the House.
The hon. Member for Bournemouth, West (Sir J. Eden) mentioned passionate speeches attacking gas and nuclear power. I agree that passionate speeches have been made outside the House attacking the coal industry. Time and again in speeches in my constituency I have expressed my suspicion that the gas and nuclear power industries are taking a certain attitude because they have problems of their own. When one considers the figure of £100 million mentioned for nuclear power, it is obvious that the industry has technological problems; though some of us believe that the cost is even greater than that.
I also suspect that the problems of the coal industry are highlighted because the nuclear energy industry is unable to generate our power requirements. Thus, we still depend on coal. This defamation of coal is wrong when those industries have difficulties of their own.
It is time that we debated the whole energy industry, remembering that the gas section of it has problems, too. Having had close association with the coal industry, I challenged the nuclear power industry in the sense that I wrote to the Chairman of the C.E.G.B. hoping that he would publish my letter, since I thought that that industry was making extravagant claims.
I received a letter from him telling me that he did not control those responsible for Power News, although a copy of my letter had been sent to the editor of that publication. I then received a reply from the editor telling me that it was a staff newspaper and that my criticisms could not be published. The C.E.G.B. is certainly not frightened to attack the coal industry, but when we confront the electricity side with the facts and some of 817 the problems that it faces, those details are not published.
§ Mr. Eadie
Perhaps the answer is that I do not feel that I am as important as the Liberal Chief Whip. I said that I would raise this matter in the House at the first opportunity, and that is what I have done.
Some hon. Members may feel annoyed that my hon. Friends and I who are interested in the coal industry should raise these matters. We have every right to do so, particularly when one considers what has happened in, for example, Scotland during the last 10 years. We had 158 pits 10 years ago. Now we have only 33. In numerous speeches Parliament was warned of what would happen if we gave up coal. Time and again my hon. Friends have pointed out that our energy requirements could not be met, but their warnings were not heeded.
On numerous occasions we have spoken of unemployment problems in development areas. We have emphasised the difficulty of providing jobs in Scotland, South Wales and elsewhere. Despite this, pits continue to be closed, but now the consumption of coal is outstripping production. Since 1964 we in Scotland have lost 20,000 miners from the industry, which is itself a disgraceful comment on the policy that has been pursued for the coal industry. We have a shortage of coal, yet we permitted that number of miners to leave the industry.
Output has fallen by more than one-third, from 18.5 million tons 10 years ago to 11.5 million tons last year. How we could have done with that extra coal. Then, consider the performance of the miners. Output per manshift has risen over that 10-year period from 21.3 cwt. to 37.3 cwt. Pit closures slowed last year to six, but in the past closures have averaged 10 to 12.
Considering what has occurred, we are entitled to demand to know what will happen in the coming year. Is this madness to continue? Are there to be more pit closures? The miners are watching this debate carefully, because their morale is extremely low. It is with regret that I 818 do not yet see my right hon. Friend who will reply to the debate in his place. Obviously, if a pit has no coal in it, it is not worth keeping open. But when pits are viable, it seems madness to close them. How much coal do the Government want us to produce? Is it more or less than, say, 11½ million tons?
The energy requirements of industry are, generally speaking, met for about 4 per cent. of total costs, although in the steel industry the cost is about 20 per cent. I regret to say that when I questioned my right hon. Friend about the importation of coal, he hedged and did not give a straight answer. I was, of course, talking about coking coal. Although some steel bosses are now talking about the possibility of importing coking coal, we have news for them. There is such a worldwide shortage of this commodity that they would not be able to import it, in any event. But what a dreadful effect it would have on the morale of our miners if such importations were allowed.
On one occasion Colvilles, in Scotland, wanted to import coking coal. There would have been even more pits closed had we allowed that action to be taken. We want a straight answer. Will the Government give permission for coking coal to be imported? If they do, it will be catastrophic from the point of view of morale.
My hon. Friend the Member for South Ayrshire (Mr. Sillars) urged the Government to examine the whole question of the capital reconstruction of the coal industry. I agree with him, because that is urgently needed. This industry has been slimmed down substantially. The N.C.B. has operated on targets set not by the board, but by Governments. Millions of pounds have been invested in equipment and plant with the aim of getting coal, but then the Government decided that coal was not required.
We in the mining industry have been arguing that it is time that the nation realised how much of the N.C.B.'s money goes in meeting the interest charges on plant and machinery which the nation decided some time ago was required to produce coal. There must now be capital reconstruction. It is ridiculous for miners to read that their industry has made a profit of, say, £27 million and then to be told that annual payments of £29 819 million to £35 million must be made to meet interest charges.
This is bad for morale. I appeal to my right hon. Friend to make a thorough examination of this whole matter and completely to reconstruct the capital side of the industry. That would help to bring back some morale to an industry whose morale is extremely low at present.
§ 6.50 p.m.
§ Mr. David Crouch (Canterbury)
The hon. Member for Midlothian (Mr. Eadie) is a Scot who speaks from the heart of Midlothian. I respect everything that he has said, including his stricture on me for trying to help him. I will now try to help myself and add to what he and other hon. Members have said.
This is an important debate about the greatest industry in this country which is contracting at the greatest rate. I thought that the Government would have more than one junior Minister sitting on the Front Bench throughout the debate. We have a debate on the coal industry about once a year. You, Mr. Speaker, are allowing us on Second Reading to range fairly widely from the Bill, because it is about the whole industry. It is wrong that we did not have here throughout the greater part of the debate both the Minister who opened it and the Minister who hopes to catch your eye to wind up, Mr. Speaker.
This is the moment when not only men who call themselves miners' M.P.s, but also those who are interested in our economy and the part that this industry plays in our economy, choose not to make incantations and weep about a declining industry, but to speak for the men who are suffering under the economic change through which the industry is going.
Many hon. Members have miners as friends in their constituencies. I am proud to say that I have. One of the saddest occurrences last year—I really mean it—was that the pit in my constituency was closed. It is sad because I still have the opportunity of meeting on Easter Monday, when I was asked to meet some of them in a village pub to hear of the problems arising from being my friends the miners in my constituency. I had a happy opportunity of seeing them transferred to other pits. They were the 820 sort of problems that the planning economist does not realise—for example, the problem of having to travel 15 to 20 miles to work. We could say, "That is nothing. The Coal Board is meeting the cost. The miner is paying only 5s. a week for the total cost of getting to and from his place of work." But this is a big change, and it has produced much unhappiness and a great decline in morale.
I want to talk about morale in the coal industry. The House knows that I have tremendous admiration for the industry. I like it. I have not been a miner, but I enjoy going down a pit. I like the people I meet there and the attitude to work that I find among miners. In days of disputes about industrial relations, it is a pleasure to see the good teamwork and co-operation between management and men in the coal industry.
To put into perspective what the Bill is about, we must remember that the 17 years from 1957 to 1974 more than half a million men will leave the industry. This is the impact that is being created.
When the Minister opened the debate, his text, if he had one, was that he intended to keep coal supply and demand in line. One would expect this of the right hon. Gentleman. It is his way of thought, as we know, from so many of his actions and utterances these days. They are commendable. But I remind him that there is more at stake. We are talking of the problems of a contracting industry and of the efficient contraction of the industry to its rightful place in our new developing four-fuel economy. It is much easier said than done.
I picked out what I thought was the key word in the right hon. Gentleman's speech today. He said that there is a need to create "stability" once again in this industry. It is not just a question of increasing productivity and reducing costs. If we think of it only in that way we shall miss the point, and we shall be wrong. We must again create stability.
The new hon. Member for South Ayrshire (Mr. Sillars), in what I thought was an excellent and outstanding maiden speech, on which I congratulate him, spoke of morale as a vital factor in the problem. I agree with him.
Lord Robens has said that he believes that he can cope with contraction of manpower at the rate of 10 per cent. As a 821 member of the Select Committee on Nationalised Industries, I vividly remember those sittings when we interrogated Lord Robens. I believe that he was right. To place a greater burden on the Coal Board of contracting at a greater rate than 10 per cent. would create conditions which could be disastrous—not because the rest of Government activity, such as the Department of Employment and Productivity and the retraining boards, and so on, could not cope with that fall-out of manpower from the coal industry, but because of the effect on the men left in the industry at seeing its over-rapid decline. An over-rapid decline and heavy contraction can produce disastrous results. This was seen in 1967 and 1968.
Other reasons have produced a feeling of dismay in both men and management, particularly in those men who are just joining the industry. Some have been mentioned this evening. One matter which has caused dismay in recent years has been the White Paper on Fuel Policy and the argument which has raged around the figures within it of forward estimates for the coal industry. There have been arguments whether the estimate of production of the coal industry in 1975 could be 135 million tons or should be estimated at only 120 million tons. We could ask: what is this small difference of 15 million tons? That small difference creates a big problem and much dismay.
Because there is a feeling of continuing disagreement between the Coal Board and its management, on the one hand, and the Government, on the other, people in the industry are wondering where their future lies. The large run-down between October, 1967, and September, 1968, when 57,800 men left the industry was catastrophic. That was a run-down of 14.8 per cent.
A fall in morale can also occur at the slightly lower pit level. When a pit is put under jeopardly notice, the immediate effect can be for the men, as it were, to pull up their socks to try to increase the rate of output and their own productivity. I have seen this happen in a number of pits. The Tilmanstone pit, in the Kent coalfields, succeeded, and the jeopardy notice was lifted. But the Chislett pit, in my constituency, was not so fortunate. It increased output from 22½ cwts. per manshift to about 46 or 48 cwts. The improvement was 822 acknowledged, but it was not enough; the jeopardly notice was left on and inevitably the closure took place. The effect of that decision on morale in the coalfield has been very serious.
Another problem which we saw in Select Committee was of voluntary wastage, that is, the men who leave the industry of their own accord. Again, I look at that period between 1957–58 when 57,000 men left the industry. Of those 28,000 left of their own accord, they did not want to remain in an industry which they felt had no future. That is why I come back to this point of stability. In 1957–58, it was a question of instability and we saw the grave results then. Now we must look to creating a new stability.
At present, it is extremely difficult to recruit into the industry. There is a failure to recruit boys and young men. The industry has always relied on miners' families to provide new recruits, but today miners are advising their sons not to go down the mines but to go into other industries. Today, there is a good career in the mining industry. It is not only a good career in terms of pay, conditions and safety which is wanted, but a career with a future, which will last throughout a man's working life.
We should say that the miner is one of the most skilled workers in industry. We are not talking about men digging with picks and shovels, but working in a highly technical industry with great skill and ability. The miners I know in the Kent coalfields are disillusioned because of one closure and concerned about the rest of the pits in the coalfield. They are not ready to recommend their sons to go into the industry, not because conditions are not good—they are excellent—but because they are concerned about the life of the pits and the future of the industry as a whole.
I want to deal with the closure procedure being operated by the Coal Board. There is a drill for a closure. It has been said that there is good consultation between the N.U.M. and the N.C.B. I have seen this work. As a Member in a mining area, I do not talk only to the management, but also to the union, to hear its technical views on whether a pit can close. All these things are done, but I sometimes sense that we are going through the motions of good consultation 823 without necessarily getting results. I was sorry to see that my pit was closed as a result of the stronger opinion of the N.C.B. carrying the day. The plea of the N.U.M. and the executive council of the miners, who had increased productivity and were asking for the chance to have another try, was ignored.
The amount of notice given in closures is not long enough. Three months is the period of jeopardy, three months in which the pit can do its best to increase output, cut down absenteeism and try to become economically viable. It is just possible for this to be done in that period, but sometimes the Coal Board should be ready to extend that period to see whether extra time is not necessary to enable the pit to climb back to economic viability.
If a pit has to close it will cause social, industrial and economic problems locally. A thousand men may be put out of work. At present, when the N.C.B. decides to close a pit it immediately advises the Department of Employment and Productivity, which gets to work looking at job opportunities in the area. It also has to look at retraining possibilities. I believe that the Board of Trade should be told, too. That is a Department coming under the Ministry of Technology. The Board of Trade is responsible for granting I.D.C.s and in some areas it might be necessary to have long-term forecasting of possible contractions and closures, perhaps five years ahead, so that plans for additional job opportunities for the men who will be released from this contracting industry can be made.
Six months' notice is not enough. A word of warning here, although I am sure that the Joint Parliamentary Secretary would have thought of this. It is that if the Government were to say publicly that there was a possibility of pits closing in, say, five years' time then nothing could be worse for the industry. This is something which should be done in confidence, worked out by the intelligence department of the Ministry.
Mr. Alan Williams
In case this point of detail has missed the hon. Gentleman's intention, I should point out that I.D.C.s come within our Department now, so that there is an internal liaison and the information is readily available.
§ Mr. Crouch
I am grateful to the hon. Gentleman. I realised that. What I am saying is that I hope his Ministry will study this in conjunction with the D.E.P. and the Coal Board, looking at contraction of the industry over a long period of time to plan against any eventuality so that if there was any question of a coalfield contracting within say, ten years, this could be seen and planned for.
In high employment areas men may leave the industry voluntarily and take jobs which could have been taken by men who might subsequently have to be made compulsorily redundant. I know that the D.E.P. gives thought to this. It is a small but important aspect of planning I listened with interest to my hon. and gallant Friend the Member for South Fylde (Colonel Lancaster), who spoke about the problems in the industry. I do not go along with him in his criticism of the higher management of the Coal Board. I do not blame Lord Robens and his team; I admire their optimism. To have a head of this industry who was anything but an optimist would present a most difficult task and would be quite wrong. We need there an optimist, a man prepared to lead his industry forward.
There seems to have been, however, a less than good relationship between the Coal Board and the various Ministers who have been dealing with power questions during the past few years. The very fact that we have not yet got an agreement over the target figure for 1975 reflects this difference between them. It is a figure which must be decided this year, certainly not later than 1971. If it is decided that it is to be a figure of 120 million tons in 1975 then the Coal Board will have to make plans to contract at a greater rate than it would like, and certainly at a greater rate than I think would be healthy for the industry. I would urge the Government to get together even more closely with the chairman of the Coal Board in order to patch up any differences.
We are faced with this terrific task of running down a great industry. We are seeing today the great social burden which that is creating, and the Bill recognises this, and I welcome the Bill for that reason, but we must not be bemused by the modern, tough phrases such as have 825 been used this afternoon—increasing productivity and reducing costs. We must not be bemused, either, by the phrase "the fate of the industry is in its own hands", if my hon. Friend the Member for Bournemouth, West (Sir J. Eden) will forgive me. Rather we should concentrate on a word which I picked out of the Minister's mouth—"stability", stability in the industry.
If we can achieve that stability there can and will be a return of morale to the miners and to the management; there could be, and, I believe, would be, a fall in voluntary absence; there would be a rise again in the recruitment of young men into the industry. I am confident that there could be a rise in productivity. I am further confident that, with all these things achieved, we could be assured of the future for coal and for the men who mine it.
§ 7.12 p.m.
§ Mr. Edward Milne (Blyth)
The hon. Member for Canterbury (Mr. Crouch), with his usual warmth, paid tribute to the efficiency and skill of the folk in the mining industry. I think this is best exemplified by the adaptability of the miners in the areas of pit closures and where there is alternative industry.
It is because of the follow-up of the 1965 and 1967 Acts that we welcome the proposals in this Bill, firstly because of the measures contained in the Bill, secondly because it gives us in the mining communities opportunity to avoid some of the mistakes which have been made in the application of the Measures of 1965 and 1967. I want briefly to refer to two main parts of this issue.
Too little has been done on the question of the compensation to the Central Electricity Generating Board for the use of coal in power stations. When my hon. Friend the Joint Parliamentary Secretary ceases to be interrupted from the bench behind him he will be able to follow the point which I am endeavouring to make, that if the coal-fired power stations were allowed to work to full capacity, then, according to his right hon. Friend the Member for Barnsley (Mr. 826 Mason), when he was Minister of Power, we would be using a further 10 million tons of coal per year. This question of compensation to the generating board must be looked at more closely when the Bill becomes an Act, because it is a vital factor in spinning out the length of life of some of the pits which are due for closure in the future.
Tribute has been paid to the two Acts of 1965 and 1967 for having cushioned the run-down of the industry. There is a general tendency for people to say that the coal miners have been well done by because of the rate of redundancy payments. I would agree, but only to a limited extent, because we are not merely making redundancy payments to contribute to the run-down of the coal industry but because maintenance of work and earnings is inherent in the philosophy of the Labour Movement, and also because—and we must never forget it—Britain's industrial recovery in the post-war period was largely due to the contribution made by the mining communities, and a great deal of the industrial prosperity which we enjoy sprang from the efforts of the mining communities in the immediate post-war period. Therefore, let us not talk about compensating the miners but rather let us talk about the contribution which the miners have made and are making to the reorganisation and restructuring of industry in Britain at the moment.
On the questoin of redundancy payments I should like my right hon. Friend to have a look not only at the provisions of the Bill but also at the spirit of redundancy payments, because a number of anomalies have sprung up in the mining areas. Let me briefly give an illustration. At the time of the closure of certain pits in Northumberland, if the earnings of the miners then had been used for the assessment of redundancy payments, instead of waiting until the salvage work had been done after the pits had closed, many of the miners in Northumberland who were redundant would have earned something like £80 to £150 more in redundancy payments. Payments of about £1 to £3 more per week could have been earned, because the rate for salvage work was less than the actual earnings of the men during the main period of their service to the industry.
827 I stress this not merely to make a plea for higher redundancy payments but because the worst sufferers from this operation and this interpretation of the redundancy payments scheme are the very people who have given the longest and the best service to the industry. The worst sufferers are the long-serving men in the industry. I do not want to go into detail, but lump sum payments of anything from £100 to £180 in individual cases would have been paid and redundancy payments of from £1 to £3 per week.
The whole question of redundancy is linked with alternative employment. We cannot discuss the mining industry in Britain at the moment in isolation. The problems of the coal industry are tied up with the transfer, gradual or otherwise, of men from a contracting industry to the newer and expanding industries. We in the mining communities, certainly in Northumberland, claim that inside of 10 years the mining force has dropped from a total of over 42,000 to just under 14,000.
Following the two previous Acts, I am pretty sure that the Government will give close attention to this matter in the period of operation of this Measure, between now and 1974. In themselves, redundancy payments are not enough. What we need is a target so that, by March, 1974, we will have used this legislation to give us the full employment to which the mining communities are entitled. If we cannot have an assurance of full employment by the time that this Measure has run its course, there will have to be a phasing out of the industry until we do.
For the first time in the period of contraction of the mining industry, we are given an opportunity to look not only at the industry but at the communities which have grown up around it. From 1965 until now, the Coal Board has been a little closure-happy in some areas where it has felt that the real solution to its problems was to put closures into operation quickly in order to get the productivity figures which it felt were necessary. It did not look closely enough at the social, economic and industrial consequences flowing from its actions.
It may be that the Coal Board, given the power of running the industry, 828 naturally would look at the most profitable ways of doing it. But it is the Government's responsibility to tell the Coal Board that, while it is being given assistance to help it meet its financial commitments and run down, equally the Government will watch carefully to see that the spirit behind this legislation is maintained. Between now and 1974, we have the opportunity to do this.
When discussing redundancy and its effects on different areas, which again is as much Government policy as it is Coal Board policy, one must have in mind all the time the state of industrial relations. Tribute has been paid to the relationship between the two sides of the industry and, as my hon. Friend the Member for South Ayrshire (Mr. Sillars) said in an excellent maiden speech, if the industrial relations in mining were as good elsewhere, there would be no need for right hon. and hon. Members opposite to lecture us about ways and means of solving our industrial relations problems.
In many cases, men are being coerced into remaining in pits when they could have been moved on to a redundancy position because of prevailing local factors. When we have a redundancy situation and men have to travel to other pits, it is the Coal Board's responsibility to see that transport facilities are readily available, even if only a few men are involved. Very often the consequences of transfers are not fully measured. I illustrate the point by citing an instance in my own locality. Miners have been transferred from a pit in the town of Blyth to neighouring Lynemouth pits. In one case, the Board is prepared to provide the necessary transport. In the more difficult of the two travelling arrangements, it is not prepared to allow this to be done.
When questions of this kind are raised with the Department, the answer is often given that the Department cannot intervene because the matter comes under the day-to-day responsibility of the Coal Board. I agree that the Coal Board should be given the day-to-day responsibility for the industry. However, in addition, the Government must keep a careful watch on its operations, and that applies to the operation of this Bill and the way that it affects different areas of the country. Obviously they will not all be affected in the same way at the same 829 time. Nor will they have to cope with the same problems. But, as we continue to contract the industry, the problems will increase.
I am not unduly pessimistic about the future of the industry. I believe that it will remain a great one for a long time to come. But that can happen only if it is integrated with the new and incoming industries which are attracted to the mining communities.
This Bill is not merely a means of giving assistance to the National Coal Board to run down the industry. The banner of full employment must be flying before March, 1974, otherwise we shall have wasted our time dealing with issues of this kind. It may be that, in the period between now and 1974, either the Ministry will have to resurrect the White Paper on mining so that we can have adequate discussion on the implications and details of it or, based on our experience of the 1965 and 1967 Acts, we shall need a new White Paper so that we can chart the future of the mining industry as we did in the past.
§ 7.27 p.m.
§ Mr. Eric Lubbock (Orpington)
I begin by adding my congratulations to those which have been expressed to the hon. Member for South Ayrshire (Mr. Sillar), who made an extremely good maiden speech. It was a pleasure to listen to him, because, clearly, he is extremely knowledgeable about the coal industry. I say genuinely what people often say as a matter of form: we shall look forward eagerly to hearing him in future debates, particularly on this subject.
I was amused by the hon. Member's reference to the hon. Member for Hamilton (Mrs. Ewing). It reminded me of the story about Frank Owen, who sat for Hereford between 1929 and 1935. After he lost his seat in the 1935 General Election, he made a speech in which he said, "In 1929, the wise, far-seeing electors of Hereford sent me to Westminster. In 1935, the bloody fools threw me out."
The hon. Gentleman was the first in this debate to raise in some detail the question of morale in the industry, and he pointed out that it was an important factor in ensuring the industry's future success. Many hon. Members who 830 followed him agreed, and amplified the point to some extent.
The hon. Member for Blyth (Mr. Milne) said that in his opinion one of the most important factors in securing an improvement in morale was to make sure that adequate alternative employment opportunities are available for miners who are made redundant. While he criticised the payments made under the scheme, I inferred that he felt that the more important of the two factors was to see that there were jobs available for skilled people thrown out of work at an age when they still have plenty of capacity left in them.
The only positive suggestion in the debate so far was that of the hon. Member for Canterbury (Mr. Crouch), who said that the Government should have a more forward-looking policy of granting I.D.C.s in areas where it is expected that pits will close. There is nothing in the Bill to deal with the creation of new employment opportunities, and this must be considered separately by the Minister, but it is a factor which should be emphasised.
I said in the debate on the 1967 Coal Industry Act that we should consider creating new employment opportunities by means of public enterprise in the areas of declining mining employment. This may surprise hon. Gentlemen opposite, coming from me, but in most of these areas it is not a question of I.D.C.s. The hon. Member for Canterbury is in rather a special case, because those pits are not in a development area. But if one takes Blyth, or Midlothian, for instance, any manufacturer who wants to go there will be received with open arms in the Ministry of Technology and told that he can have an I.D.C. for as many square feet as he likes—
§ Mr. Lubbock
As the right hon. Gentleman says, he can get enormous grants on his capital equipment.
So the inducements are there, but, unfortunately, industry is not always ready to take advantage of them. In some development areas where mining is declining, there are advance factories which have been empty for up to 18 months or two years.
831 I hope that the Ministry will give some thought to my suggestion here three years ago that public enterprise could have a part to play where it is found that alternative employment is not being created in these areas by private industry. That is a positive suggestion which the Minister might consider separately from the Bill.
One has to decide what levels of output the Coal Board should aim to achieve in the areas under examination, what rate of reduction in manpower employed by the N.C.B. can be tolerated, and how much the taxpayer and the consumer between them should be required to pay to maintain a given output. These are not three separate questions. The answers would have to be reconciled with one another. For instance, if one decided the required output first, both manpower and the financial implications would follow from that decision. Conversely, if one started with the financial ground rules, as we are doing under the Bill, that should enable one afterwards to calculate the implications for output and manpower.
I put that statement in the conditional tense, because, as the Report of the National Board for Prices and Incomes points out:This sharp deterioration in the estimated deficits over the space of only a few months casts considerable doubt over the N.C.B.'s forecasting methods…I take the point raised first by the hon. and gallant Member for South Fylde (Colonel Lancaster), that it is worrying to see, as the Prices and Incomes Board has said, how rapidly these estimates have changed during the course, the hon. and gallant Gentleman said, of only two months.
But that alteration in the estimated O.M.S. which took place while his Committee was carrying out its investigation was not the last. He said that it came down from 51 cwt. to 47 cwt. per man-shift. Since then, it has been revised downwards, as the report says, to 44.2 cwt. So, within less than a year, there have been two drastic revisions in the forward estimates of the Coal Board.
I agree that this casts a serious doubt on the management ability at top level of the Coal Board. If they can make these serious mistakes, how can we trust 832 any of the figures which they put forward as a basis for planning the future of the industry? How can the Minister trust the figures given to him? I suppose that he must depend largely on what the N.C.B. tells him for doing his own calculations.
I do not know the answers to these questions, but, between 1968 and 1969, the output per manshift increased by only 4 per cent. The N.B.P.I. now warns us that the estimate of a 6.3 per cent. improvement from this financial year, 1969–70, to the next, may even err on the optimistic side.
Since there is, as yet, no explanation for this slowdown in the rate of growth of O.M.S., we cannot be at all certain whether it represents a hiccup in the trend or whether it is indicative of a more fundamental long term change in the industry as a whole.
§ Mr. Frank Hooley (Sheffield, Heeley)
Is it not mathematically inevitable that, if the older, unprofitable pits are closed and the profitable ones remain, the capacity for increased productivity must decline?
§ Mr. Lubbock
This rather seems to be the view of the Prices and Incomes Board. I was going to mention what the board said in paragraph 10 of its report as being factors to take into account in deciding what is likely to happen to the O.M.S. in future years:The estimates based on the policy appear, however, to have taken insufficient account of the fact that the greater complexity of equipment increases both the risk and the effects of production breakdowns; that geological difficulties increase as faces are worked at a faster rate; that problems arise in adjusting certain largely manual operations, such as 'ripping', to the pace of the new machinery; and that management and supervision become increasingly demanding.Although this was a fairly quick investigation and is, of course, being followed by another, more comprehensive, one, these factors would seem to bear out the conclusion that we have passed the era of very high rates of growth in O.M.S. such as we had in 1968, when there was an improvement of about 9 per cent.
One then comes to the question, in that case, why does the Coal Board, having experienced a drop of 4 per cent. 833 between 1968 and 1969, now expect that it will go back up again to 6.3 per cent. in comparison between this financial year and the next? The Minister said that the recent falling off was potentially serious, but that he had good reason to hope that productivity "will rise sharply". I should like to know what reasons there are in the Coal Board for the Ministry—we have certainly heard none today—for expecting this improvement. I should be the first to clap my hands and fling my hat in the air if the Minister could convince me that that is at all likely.
I am worried by the fact that, on the same basis that it expects that it might be at the lower level for some years to come, the Prices and Incomes Board report expects that we will not get the sort of increase that one hoped for. If so, we cannot then accept the N.C.B. forecast of a £2 million profit for 1970–71. That would be conditional on achieving the 6.3 per cent. increase in O.M.S.
There is a very serious risk, then, that the accumulated deficit on revenue account would exceed the £50 million which was laid down by the 1967 Act before the end of the financial year 1970–71. I am warning the House of this now because it is necessary to take it into account in considering the Bill.
The total output in 1969 was 150.5 million tons—I am taking this from the N.C.B.'s Press release after the end of the calendar year—and consumption, including exports, amounted to 164.7 million tons.
The right hon. Member for Greenwich (Mr. Marsh), when Minister, estimated in the debate on Second Reading of the Coal Industry Act, 1967, that consumption in 1970 might be 155 million tons, and his figure would seem to be about right. In other words, one could anticipate a reduction of about 10 million tons between the two years. On the face of it, the N.C.B. has little prospect of satisfying this demand, and this brings me to the fact that we suddenly have a transformation; from 30 million tons of coal lying in undistributed stocks to a situation when it is doubtful whether the Coal Board will be able to fulfil the much lower demands that are being made.
If the decline in manpower were sharply arrested this year, as some hon. Members 834 have suggested, by stopping the pit closure programme—except in cases where geological factors require pits to close—I still doubt whether that figure could be achieved, because one cannot stop voluntary wastage. There would, I calculate, still be a shortfall of nearly 5 million tons, accepting the increased productivity which is anticipated by the Coal Board.
If, on the other hand, we get the reduction in manpower of 10 per cent. per annum as mentioned by the N.C.B. in its evidence to the Select Committee—that could not be substantiated in answer to the questions which they put to Lord Robens—then, with a 6 per cent. rise in O.M.S. and a 10 per cent. reduction in manpower, I calculate that output will fall by another 7 million tons. Since stocks were raided to the extent of 9½ million tons in 1969, this will mean our facing a severe shortage of coal in the winter of 1970. This should be taken into account by the Government when considering the pit closure programme.
I add my plea to those that have been made for us to be told precisely what Government policy will be during the present calendar year. The Paymaster-General would be justified in saying that there will be no further pit closures for the time being. If the reduction of 10 per cent. in manpower per annum between now and 1975 is a reasonable figure, it does not mean that it must be 10 per cent. in each of those years.
The hon. and gallant Member for South Fylde will agree that just as last year we had a loss of over 10 per cent.—I believe that 38,500 men left the industry, leaving a total of 300,000 employed in the pits; that was a reduction of between 12 per cent. and 13 per cent.—so, in 1970, it could be less than 10 per cent., as long as it balances out over the period. I appreciate the Minister's point that one must look at the 1975 White Paper figures as being variable according to what improvement is O.M.S. one can anticipate between now and that date.
The right hon. Gentleman said that if we could achieve a 5 per cent. improvement each year, we could attain the 120 million ton target. He then said that if, on the other hand, it went as high as 9 per cent., then obviously output would be that much higher. However, he did not give the figure, and it would 835 be interesting to know—the industry and those who work in it would like this figure—by how much extra output would increase with each 1 per cent. improvement in O.M.S.
The possible effect on demand of the two recent price increases must be considered, and there will probably be a further increase when the N.P.B.I. has completed the further review which it is still undertaking. These price increases will erode the competitive position of coal and inevitably reduce demand. I therefore do not believe that the Minister is right to say that output in 1975 is a function solely of improvements in productivity. The demand for coal must be partly dependent on the competitive position of coal vis-à-vis other fuels.
With increases as high as 10 per cent. just granted to the N.C.B., many consumers may think seriously about converting to other fuels. It is, therefore, of importance that the patterns of energy demand should be kept under continual review. I wholeheartedly endorse what the hon. Member for South Ayrshire said about the need to bring the White Papers figures up to date. If that were done it would meet the spirit of what the right hon. Member for Greenwich said when introducing the Coal Act, 1967.
The right hon. Gentleman said:There can be legitimate arguments about many aspects of fuel policy—this is provided for in the White Paper, which says clearly that 'there will be a rolling review in the light of changing circumstances'…".It is rather amusing to recall that he also said:If I may make a party point in passing, it is quite incredible and almost unforgivable that, in a field in which we spend £3,500 million a year and employ over 800,000 men, no attempt was ever made to establish the trends in the fuel industries until this Government came in."—[OFFICIAL REPORT, 28th November, 1967; Vol. 755, c. 248–9.]The right hon. Gentleman may have been right, though on that occasion he was contradicted. If that was a legitimate point to make then, why has not this establishment of trends been undertaken? Why do we not have up-to-date figures and why are they not kept continually up-to-date, as the right hon. Member for Greenwich promised they would be? The Ministry undoubtedly has figures for internal use. If we are to 836 discuss this matter adequately we must have access to the same figures, I trust, therefore, that the Paymaster-General will let us know if we can see the economic analyses and market assessments made up to 1975.
As a number of hon. Members still wish to take part in the debate, I will conclude. I believe that we have, for the limited purpose of making up our minds about this Bill, sufficient information to go on. The Bill could be justified solely on the ground of the need for flexibility to even out fluctuations, which are inevitable, around the trend line. On that limited argument we are able to support these proposals. At the same time, however, we must put on record our dissatisfaction with the meagre amount of information that the House has been given.
§ 7.49 p.m.
§ Mr. W. E. Garrett (Wallsend)
I welcome the Bill on behalf of my mining constituents. Like the hon. Member for Orpington (Mr. Lubbock), I shall be brief, particularly since a number of hon. Members still wish to take part in the debate.
Clause 4 points out that generating boards can receive grants from the Government through the N.C.B. for the use of coal. However, there is no reference to the assistance that could be given to what I consider to be a most important matter, and that is the disposal of waste from the production of coal.
At present, the situation is chaotic. Hon. Members who live in or near mining areas have probably spent most of their lives looking at black pyramids of slag. They will have been disappointed not to have found provision for financial assistance to be given for removing this waste in a planned and proper way. There is an 85 per cent. grant from the Government now, and local authorities can accept it and find the cash for the 15 per cent. to remove these unfortunate eyesores, but very little is being done in this direction.
I should like provision to be made for assistance towards removal of waste heaps. They could perhaps be used in land reclamation. Especially from the North-East, they could be exported. If the price was right I am sure the Dutch 837 Government would take this waste across the North Sea and use it in a proper manner. I am indebted to my hon. Friend the Member for Sunderland, South (Mr. Bagier) for the campaign he has been mounting in the last few months to get some cohesion of policy on this matter. I look forward to the reply to the debate which, I hope, will refer to this problem.
Unfortunately, the hon. Member for Newcastle-upon-Tyne, North (Mr. R. W. Elliott) is not at present in his place. I pay tribute to him for his intensive campaign with reference to shortage of smokeless fuel on Tyneside. I raised this matter four-and-a-half years ago when I was given bland assurances that adequate supplies would be available. Since then, as we know to our sorrow, the situation has deteriorated rapidly. I should like the Minister to put some extra effort into getting an immediate solution to this problem. Otherwise, the situation will deteriorate still further.
My third point has been dealt with by my hon. Friends the Members for Bedwellty (Mr. Finch) and Blyth (Mr. Milne). It is in relation to redundancy payments. I am pleased that the rigid age of 55 years—not 54 as was previously stated—has now been dropped and we are to have more flexibility. We must remember that nearly 7,000 miners are unemployed in the North-East alone. In the main they are in their late fifties or early sixties. When redundancy payments end, they suffer an immediate drop in their standard of living and have to exist on basic social security payments. I hope that consideration will be given in Committee to extending the three-year period. I think particularly of men of 62 or 63 who may have used up the three-year payments. I should like the payments to be extended to the age 65 when they would qualify for retirement pensions.
I hope that I shall receive replies to these points at the end of the debate.
§ 7.53 p.m.
§ Mr. Peter Emery (Honiton)
I am delighted to be called after the hon. Member for Wallsend (Mr. Garrett) and the hon. Member for Blyth (Mr. Milne), who speak with real understanding and knowledge of the problems of mining in the North-East. As the hon. Member for Blyth knows, in 838 another capacity I have tried to do a little to provide some form of industrial employment in a new factory in his constituency. On the whole the few miners we have been able to employ have made a great success of their new jobs. I am delighted to be able to say from these benches that where proper retraining has been carried out on redundancy one could not get better people more willing to apply themselves to new jobs than miners. This work is in the chemical industry and the men have achieved considerable success. This is the sort of tale which should go out from this House about the application of redeployment of individuals who, through no fault of their own, find themselves redundant.
I go back to the interruption I made when the Minister of Technology was speaking, particularly as this point has been taken up on both sides of the House with considerable force. It is about the need to up-date Cmnd. Paper 3438, the Fuel Policy White Paper. The Minister, in his extremely able way, side-tracked the question I put to him. Of course I do not want nor expect a new Fuel Policy White Paper. That is not what I asked for. I referred specifically to a Question I put to the Ministry, which was answered by the Paymaster-General. I asked if the Fuel Policy White Paper could be up-dated to take account of variations of policy and an estimate given of future figures for consumption and the pattern of supply.
I go a stage further and ask if two tables would not be of considerable assistance. I refer to Table A on page 36 of the White Paper, Trends of Primary Fuel Use, showing the actual and then the estimate for 1975. If the Minister would up-date this it would be of considerable assistance. Would he also see that Table D on page 64 is brought up to date? It is essential for these figures to be known by anyone attempting to make a judgment about fuel policy redundancies, closures and the whole effect on the industry. Otherwise, one cannot properly make a judgment.
This is why I was delighted that the hon. Member for Orpington (Mr. Lubbock) stole the quotation, which I thought of using, from a speech by the previous Minister of Power, the right hon. Member for Greenwich (Mr. Marsh). The former Minister implied without any 839 doubt that we would be able to obtain rolling forecasts all the time. Purposely I have not pressed the Paymaster-General or the Minister to do anything since my Question on 18th November, because it seemed that the answer I had was at least a partial assurance. But we have not had any new figures. I urge the Minister to understand that we need this information.
We have to realise that there are variations. We see the problems in the present position and the fact that we have had two price increases brought about in the coal industry during 1969. There has been the condemnation from the N.B.P.I. saying that something was very wrong when we had to have those two prices brought forward in the period. They cast considerable doubt on the figures produced by the National Coal Board. On the other hand, we have the National Coal Board saying in its Annual Accounts for 1968–69:the Board do not agree with the policy underlying this estimate…That is the estimate of 120 million tons—and they have, therefore, continued to stress the adverse effect such a policy would have on confidence in the future of coal, not only within the industry but also among the industry's customers. The Board consider they have the capacity to produce and sell competitively 135 million tons.Here we see a divergence.
The report adds:Arising from the Minister of Power's conference at Sunningdale in October, 1968, further study is being given to the trends in the coal industry. The Board welcome this in the belief that it will show that the coal industry should make a greater contribution to the fuel requirements of the nation and justify reconsideration of the policy set out in the White Paper.Not only does this House want the forecasts brought up to date, but the Chairman of the N.C.B. does. We have on one side the Minister still holding to one lot of figures and the Chairman of the N.C.B. holding to another. The Minister is in a very untenable position if he will not update the figures. It is not right for the Paymaster-General to get up towards the end of the debate and say, "Oh, but these figures are difficult to produce".
There is no better computer model in existence, I believe, than the fuel model which the Ministry of Power spent many 840 years making, in the preparation of the White Paper. Therefore, in up-dating the matter it is a question only of obtaining information, whether by random access or otherwise. It is true that estimates and budgets may be in doubt but they are only estimates and budgets. That does not matter. We feel that we have a right to demand them. For that reason, I urge the Minister to provide this information before we go into Committee. It is only if we have it that we can judge the Bill properly.
The right hon. Member for Greenwich, introducing the Second Reading of what became the 1968 Coal Industry Act said:The purpose of the Bill is to enable the coal industry to have a breathing space…"—[OFFICIAL REPORT, 28th November, 1967: Vol. 755, c. 253.]He went on to say that what he wanted was to allow for the industry to be of the right size in 1970. We are now in 1970 and the whole approach of the Minister then was that the breathing space would allow us to get things more or less right by 1970. That has not happened. I am not trying to condemn the coal industry, I am only saying that this situation has not been brought about and it is, therefore, even more necessary that we should have these figures brought up to date.
I feel that I have the right to ask the Minister to give the House three answers to three direct questions. What is the estimated manpower need of the N.C.B. in 1975? What is the estimate of pit closures for 1970–71 and 1971–72? The miners, the industry and the nation have a right to know, because there are plans on the file about this. What does he estimate will be the figure for coal consumption in 1975? I will not insist on that date, but some figure in the future.
I have always said, and it may be thought harsh and unkind, that we should get pit closures through as quickly as humanly possible. I do not mean that we should put them all through in one year. From a social point of view that would be wrong, but we should try to get the pit closures through quickly so that we can retrain the younger men in the pits. They can be retrained when in the age group 35–50 but beyond that it is not so easy. The longer the pits are kept going, the larger will be the number of those who will not be able to be retrained. From the manpower point 841 of view there is a strong argument for trying to reach the stability level as soon as possible.
We want to see production and manpower at that level as soon as we can reach the break-even point in the industry. That will do an immense amount to raise morale in the industry. When we are at the break-even point the industry is a viable entity, able to compete with anyone and the sooner this can happen the better it will be for the manpower position, for recruitment and for the general feeling of those in the industry. It is right and proper that the country should know.
In this Bill we are adding £70 million on to a cost, only three years ago, of £133 million, which is a £203 million bill. I wish to be scrupulously fair and it can be estimated that between £20 million and £24 million would normally have been made through payments from the Ministry of Social Security. There is then a bill of £180 million. I do not for one moment begrudge that and I do not want anyone to suggest that I do, but we must know that this is the real cost. As this expenditure is being incurred it is better to spend it as soon as possible to reach the right economic level within the industry, for the benefit of the industry and the nation.
I heard no mention during the Minister's speech of the borrowing power position. As he knows, the 1967 Act increased the borrowing power to £900 million, or £950 million by Statutory Instrument. This played a certain part in the proceedings on the 1967 Bill. Could the Paymaster-General tell us whether that borrowing power, which was meant to last until the end of 1971, still holds good, or whether it is considered that there will have to be more?
My last point concerns my constituency and certain aspects of life in the South-West. It is to do with the problem of smokeless fuel and the manufacture of it within the industry. I realise that there are immense problems and that it is possible to quote from any of the last three reports of the N.C.B. to show that we are seeing again the problems of increased production never reaching that which was estimated. What we do see quite clearly is that the Chairman of the N.C.B. is warning the Government about a massive shortage next winter.
842 This is of great importance in farming areas such as Honiton as well. My hon. Friend the Member for Torrington (Mr. Peter Mills) has also asked me to raise this in connection with his own constituency, which borders mine. Smokeless fuels are essential, usually, for the farmhouse, for cooking purposes as well as for heating, with the Rayburn type of stove. This is a great problem in our areas. I am in correspondence with the Chairman of the South-West Gas Board who is providing some of the facts, but it is right that the Government should come clean on this now.
We see the problem being presented to us, but in our debate five or six weeks ago the Ministry of Housing and Local Government, which really took the lead in the debate, pushed the matter under the carpet. That is not good enough. The Government should tell the country what the problem is and then how we can cope with it. If there have to be stand-still orders, let us know, but for goodness sake do not try to hide the problem now, and then spring it upon us as though the Government did not know anything about it, or leave it as a problem for the Conservative Government to clear up, along with many others, after the next General Election. Let us have the facts.
I hope that my speech, which has been mainly concerned with seeking information, will receive a ready response. It is incorrect to expect the House to be able to make a judgment of the types of problems that exist with this Bill without the proper information. The Government have that information. Why cannot they make it available to Members and to the country?
§ 8.10 p.m.
§ Mr. David Watkins (Consett)
The hon. Member for Honiton (Mr. Emery) opened his speech by paying a very warm tribute, speaking from experience, to those redundant miners who have been retrained and entered other employment. I represent a constituency that has suffered a very heavy programme of pit closures and has had an infusion of other types of industry, and I have never found a single employer who did other than to pay warm tributes to those redundant miners who entered other occupations after retraining. The message should go 843 out loud and clear from the House about the adaptability of miners for other forms of employment where necessary.
I welcome the Bill. In the interests of brevity I shall touch on only two aspects of it, both directly related to redundancies and the treatment of redundant miners. The first is the extension of the redundancy payments scheme and the second is the extension of the reimbursement of the National Coal Board where colliery closures are deferred and the pits remain uneconomic. These are dealt with in Clauses 2 and 3.
During the great wave of redundancies and pit closures in 1967 to 1969 more than 23,000 redundant miners benefited from the redundancy payments scheme. In such a large number there were bound to be disputed cases. Speaking from constituency and other experience, I believe that there were those deserving of compensation under the scheme who were deprived of it because of the interpretation put on the regulations which laid down the means by which they are paid. There were only a few cases of injustice, but injustice is no less great if it applies to a small number of individuals than if it applies to a large number. As there will certainly be more closures, it is inevitable that there will be more disputed cases.
One of the omissions from the 1967 Act, which is not rectified in the Bill, was an appeals procedure, though it has since been established in an ad hoc fashion. When the Order to bring in the scheme was debated in the House as long ago as 14th June, 1967, a number of hon. Members, including myself, pointed out the necessity for an appeals machinery. I have followed the matter up with Questions in the House and correspondence with the Ministry, which culminated when I raised the whole matter in an Adjournment debate on 6th February last.
One of the features of the scheme is the lack of knowledge about its technicalities and provisions among those entitled to benefit from it. The appeals machinery of which I have talked, which was brought into being so tardily and laboriously, is almost totally unknown in the mining areas, and I am sorry that there is no provision in the Bill to introduce and regularise an appeals machinery 844 under which disputed cases can be dealt with. It does not seem to me to be difficult to publicise the appeals machinery now in existence, but it is largely unknown. Why should not a simple form of printed letter go to everyone who could benefit under the scheme, advising him of his rights and giving information about the technicalities of how to make an appeal if he feels aggrieved at the manner in which he is treated?
Whilst it is important that the best possible treatment should be given to those who become redundant with little or no prospect of getting alternative employment, it is equally important that so far as possible redundancies should be avoided by keeping pits open longer. The 1967 Act established a fund of £5 million, which can be raised by the Minister by order to £8 million, to compensate the Coal Board for keeping uneconomic pits open where it is agreed that this should be done. My right hon. Friend said in opening the debate that about £2½ million had been used. There is no provision to increase this amount in the Bill. Since only about a third of the total available has been used it is clear that the fund might very well be used more liberally—though certainly not wastefully—than it has been in difficult areas.
There is a special case, for instance, to use it to keep open those collieries which are producing coking coal. The world shortage of coking coal and the outstripping of supply by demand has figured prominently in the debate. In the west of County Durham, an area which has suffered very severe contraction of the coal industry, the pits produce coking coal almost exclusively. One of the problems is that a large number of small seams remaining in those pits, although by no means exhausted, cannot be worked economically.
Here is a classic case for keeping pits open to avoid, among other things, the import of coking coal, which is a distinct possibility if we do not produce more of it in this country. We should use the fund to make available an additional supply of coke from our own resources and keep the pits open longer, not only because this will alleviate the employment position until the introduction of new industry on a larger scale, but because it is far more sensible to spend the money 845 rather than to pay out foreign exchange to import coking coal when we could produce more of it.
Although it is short, the Bill is very comprehensive, dealing with practically all the vast ramifications of this large and crucially important industry. I have deliberately dealt with only two features of the Bill, so as to be brief. They may seem to some hon. Members to be comparatively minor features within the broad sweep of the Bill, but they are important to many thousands of miners who, because they have given a lifetime of service to the industry, have reached the age where they are in most danger from any further contraction that may come about in it.
In welcoming the Bill, I expect that my right hon. and hon. Friends in the Ministry will take full note of the very human aspect of the whole problem with which the Bill seeks to deal.
§ 8.19 p.m.
§ Mr. Richard Kelley (Don Valley)
I must apologise for having been absent for about two hours earlier in the debate. I was called upstairs to make a quorum in a Committee so that some people who had travelled some distance to given evidence could do so.
My hon. Friend the Member for Consett (Mr. David Watkins) has just said that he welcomes the Bill. I think that all hon. Members with the interests of the coal industry at heart will welcome it. The question is how we are to use the period that the Bill is intended to cover to bring about stability in the industry. We are all grateful to you, Mr. Deputy Speaker, for allowing this wide-ranging debate, which has enabled us to discuss the many factors involved in the industry reaching the stability we would like to see.
During the past six years the manpower in the cola industry has contracted from more than half a million to considerably under 300,000. This means that 200,000 men have had to be retired or redeployed, each one of whom presents an individual problem. It is to the credit of the National Union of Mineworkers, the Coal Board and the Government that, during this traumatic experience through which the industry has passed and which began before 1964, there has been a more compassionate and humane attitude to the social problems which arose.
846 In the years between the wars I had to leave my job because the Italians did not want any gas coal. I had to walk to Yorkshire and find work there, and I understand what that involves. The same problems affect the movement of labour today. People have to tear up their roots, leave the communities in which they were born and bred and put their children into new schools. These are individual problems. We are grateful to the Government for introducing this Bill to continue the support which has made possible the humane treatment of men who have to find other employment.
The social consequences of contraction involve men going to new pits, and men at the age of 55, or perhaps older, coming to the end of their industrial life and ceasing to regard themselves as useful citizens. They have to live on retirement pay which is, for a short period, fairly generous, and it is highly improbable that they will ever again get another job.
The hon. Member for Wallsend (Mr. Garrett) said that he would like the support to continue until a man reaches the age of 65; so would we all. No miner, with the dignity of the industry that flows in every miner's blood, would want to stay off work if he could find another job, but it is not easy for men of 58 or 60 to find work elsewhere in the industry in which they have spent their working lives and gained all their skills. I would like to see the support extended until the man reaches 65, when he will become a State pensioner. No man wants his industrial life to cease at that early age unless he is amply compensated for the loss of ability to work. This has a great deal to do with the morale which has been talked about so much tonight.
Clause 1 of the Bill reduces the contribution towards relevant expenditure from two-thirds to one-half for the second period, and to one-third in the third period. People will get the idea that the Government are likely to leave them to fight this battle on their own, and they know what will be the consequences. It is deplorable that this parsimonious attitude, for the sake of no more than a few pounds, has been allowed to interfere with the continuing support which people in this industry are entitled to expect during the next three years.
I represent a large mining area; fortunately, it is a relatively new coalfield, 847 and for geological reasons it is in a fairly strong economic position. So I do not want to take up too much time when other hon. Members may have more pressing problems in their constituencies about which they wish to speak.
I think that an announcement should come from the Front Bench this night that there will be no further closures on economic grounds until there has been a complete review of the national fuel policy, and until we have determined the size of the contribution which coal must make to the energy requirements of the nation. We should insist that the financial structure be looked at again. The £415 million write-off did not mean a great deal. It was the first review of the financial structure since vesting day.
Since that day, £544½ million has been paid in interest by the coal industry to the Government. Last year, a trading profit of £29 million was made into a deficit of £9 million by the £38 million which had to be found for interest. We are now paying as much in interest for 153 million tons as we were paying for 180 million tons. The cost of interest per ton is rising, and will continue to rise in so far as the total tonnage produced is reduced.
Until we have had a review of our fuel policy, including another look at the financial structure of the industry, and made possible the stability which the Minister wants to achieve, there should be no further closures on economic grounds in the mining industry.
§ 8.26 p.m.
§ Mr. Eric Ogden (Liverpool, West Derby)
My hon. Friend the Member for Don Valley (Mr. Kelley) has made his usual informed, thoughful and effective speech. He was absolutely right to emphasise that the Bill is about more than pits, production, statistics and forecasts; it is about the lives and the quality of living of hundreds of thousands of men, women and children and of whole towns and areas of this country.
There has been a wide measure of agreement between both sides of the House, perhaps more than is usual on such occasions. I would show good will perhaps by offering my congratulations to the hon. Member for Bournemouth, West (Sir J. Eden). The Opposition have 848 learned a great deal in the past six years about the problems and the achievements of the coal mining industry and we shall offer them all the help that we can to see that they remain an informed Opposition for many years to come.
May I add my congratulations to my new hon. Friend the Member for South Ayrshire (Mr. Sillars) who made a first-class speech, informed and witty, which not only was appreciated by those who heard it but would be appreciated by his predecessor in South Ayrshire from whatever direction he happened to be listening to it at this time.
I should declare my interest in the Bill although the debate is our usual family affair. Everybody who takes part in these debates knows who is a sponsored member of the N.U.M., as I am, and who represents the coal interests on the other side. But I place on the record again that the miners' M.P.s in this House and our friends from the coalfields have never neglected to put forward the claims of their constituents, of the people they represent. We have told of the difficulties of the Coal Board and of the coal industry and also its achievements. We have never tried to bargain our support for our Government in exchange for help. We have given the facts and we have had support for the facts.
It will not be surprising to my right hon. Friend the Paymaster-General—a fellow Lancastrian I am proud to say—that we support the Bill. It is a good Bill and in the main it is a continuation of the Acts of 1965 and 1967. But it does not do all that we want it to do or, I suspect, all that the Paymaster-General would want it to do. But it is a good Bill and to demonstrate my support I would even offer to serve on the Committee if it will be of any help. [An HON. MEMBER: "Brave man."] Brave man indeed. But I must indicate that this time I would be less willing to limit my contribution in Committee to what have been kindly called brief and cogent arguments as befits a Labour member of the Committee. I should be sorely tempted to put down my own series of Amendments and ask my hon. Friends to support them. That is likely to dispose of my chances of sitting on that Committee.
Over the last 10 years the cry from successive Ministers has been, "Where 849 are we going to burn the coal we are getting?" The cry tonight is, "Where are we going to get the coal to burn?" This is the background to tonight's debate. The situation in the industry has been explained by a number of my hon. Friends who have pointed out the dangers and also the tremendous amount of help which we have received and which we have always accepted as being limited by the economic factors in the country at a particular time.
I should like to say a word about morale which has been mentioned so frequently. My right hon. Friend knew Bradford colliery in his own City of Manchester, and he will know that the miners in that pit, as in other coalfields, were concerned about the industry and the pits. But they certainly did not come to work on Monday mornings with long faces moaning and groaning simply because of the state of the industry. They went in, got on with the job and expressed their concern about the situation in the industry. As regards morale, in a sort of glorious bloody-mindedness, they though it was dangerous and it was difficult and that their lads were not coming into it and thta they would get the heck out of it as quickly as they could. But to suggest, day by day, that this is a miserable industry to join is not true.
Reference has been made many times today to the Winter Emergencies Committee and the prospects for the winter of 1970–71. Certainly there have been no attempts that I know of to sweep any difficulties under the carpet, as the Opposition have suggested. It has been well publicised. But there is one serious point. If there are to be difficulties in the winter of 1970–71 and if there are to be fuel shortages and power cuts let no one try to put the blame or responsibility for these difficulties at the door of the miners. We have carried a lot of cans for a lot of people, but that is one can that we are not going to carry. The C.E.G.B., only a few months ago, was supposed to have a spare capacity of 17 per cent. What has happened to it and to all the nuclear power stations that were to come in and the ordinary gas, oil or coal-fired stations which were going to provide that spare capacity? Let no one come along and say that this is the fault of the miners. If there is—and there is—a shortage of solid fuel, ask the Gas Council what happened to a 850 lot of their plants converting coal to gas with the spare capacity—the waste product as it is sometimes called—coke. More North Sea gas means less coke. While we carry our share of the cans, we will not carry this one in the mining community.
Equally, I make it clear to my right hon. Friend—and although I am perhaps a little more emotional than usual he is still my right hon. Friend—that if there is any suggestion of the importation of coal, or even coking coal, that will cause rows on these benches the like of which will not have been seen for many years. Equally, we are entitled to know from hon. Gentlemen opposite who have skirted around this very carefully, what is their policy about the importation of coal. It is a simple question. Are they going to support or oppose it? This is one question which they can answer and I hope that they will do so tonight.
There are three points I want to make on the contents of the Bill. Clause 1 deals with the social cost of the pit closures. Available is £22 million to be phased at the rate of two-thirds, a half and one-third. The 1965 Act specified a half. If one averages the thing out, presumably two-thirds, a half and one-third come out at a half. The half in the 1965 Act was increased to two-thirds in the 1967 Act. Now we are going back in the 1970 Bill. It is not enough and we can do better, particularly as the total sum will be much less than in previous years. We want a better scale, possibly over a longer period, than is proposed in the Bill.
Clause 2 deals with redundancy payments. These will continue but no details are given. We know that the Board and the N.U.M. are well able to argue with each other and with the Government. I trust that there will be great insistence that the terms of the final agreement must be no less advantageous than the present terms under the 1967 Act. That is a minimum. One can do this in different permutations but, over all, the proposals should be no less advantageous to the persons receiving help benefits than under the present scheme.
Clause 3 deals with closures. The Board will continue to have losses reimbursed when the Government defer pit 851 closures. However, it is highly unlikely that there will be as many closures in the next year or two as there have been in past years. Indeed, there might be no capacity in any pit. It is all very well to say that this is a book-keeping exercise and that we will not give money to the Board and that will close the account, or that there is no money available in any account to keep marginally economic pits open. My right hon. Friend has great financial experience and I suggest that he transfer money from one account to another so that a sum not less than before is available to keep marginal pits open, just as has happened in the past.
I believe that three further points should be included in the Bill—and there goes whatever chance of serving on the Standing Committee that I might have had. They should either be in this Bill or included in parallel legislation. My right hon. Friend will have heard of the Hunt Committee's Report. Indeed, there is some suggestion that he wrote part of it. In that report, it was suggested that the Board should use its derelict Land Reclamation Unit to establish a nationwide authority for the reclamation of derelict land. This includes not only the moving slag heaps. It is fascinating that we have in some parts of the country these unwanted slag heaps, whereas, in other parts, there are unwanted holes in the ground, with motorway constructions linking the two.
Yet it seems that we cannot get the two together so that we can use slag heaps to fill the holes and build the motorways. I hope that we shall hear something tonight about the possibility of using the National Coal Board as a base for a nationwide derelict land reclamation unit.
I now turn to the capital value of the National Coal Board. My right hon. Friend the Member for Newton (Mr. Frederick Lee) introduced the 1965 Act which wrote of £400 million of capital. Very many pits have been closed since then. The Ministry has been good at providing information, even when I put down 141 questions to it in one day. It has answered many of them. Between 1965 and 1966, more than 233 pits were closed. Their total capital value was £78.5 million. Yet the interest on capital 852 being paid by the Board remains as it was on the 1965 capital. This is not normal business practice. My right hon. Friend is probably in a better position than anyone else to look at the financial structure of the Board and see whether the capital of the pits closed for geological, economic or any other reason year by year should not be written off to compensate the Board.
I turn now to the question of regional economic development. While some mention has been made of industrial development certificates, intermediate regions and the rest, we, on this side particularly, should also be proud that one of our hon. Friends who has spoken as a miners' Member in previous years is now Minister of State at the Ministry of Technology. I refer to my hon. Friend the Member for Chesterfield (Mr. Varley). We hope that he will be able to help these areas, of which he has special knowledge and information, in the allocation of new industry. I see no reason why a nationalised industry in a development area or intermediate area or special area should not get some help from the Government in grants, investment and support, just as private industry gets them. If it is good for the C.B.I. to get aid why is it not good for the N.C.B.? I hope that my right hon. Friend will look at this matter in the legislation. I have added my thanks for Tilbury B. We had discussions with the Minister and with all sections of the industry and I am very grateful for this decision. It could have been very dangerous and difficult but the Minister has made a practical decision, a good one, which gets our support.
There is one point I would make which is perhaps more one for my right hon. Friend the Prime Minister. We have been talking of changes in the National Coal Board and in the coal industry, but the Ministry of Power has had more than its fair share of changes. There might be some comparison made in other quarters between the control exercised by the Minister of Defence over his Department and the control that is able to be exercised by different Ministers as they come to their own Departments. There have been three major changes in Ministers over a small period of time, with Ministers staying perhaps for less than two years in a Department. The right hon. Gentleman might give some 853 consideration to allowing some of his colleagues to stay longer in one Ministry.
We are here, in the main, repeating legislation that has gone before. There is still too much competition, too much empire-building, between the coal, oil and the gas industries, the C.E.G.B., North Sea Gas and others. They could well do with a Minister able to say that we need more co-operation and co-ordination rather than quite so much competition, with each going out on its own causing greater difficulties for the remainder. The right hon. Gentleman the Paymaster-General has knowledge of the cotton industry. He has shown in I.C.I.-Courtaulds in recent months that he can influence decisions in situations where he may not have, in law, actual reserve powers. This is what the industry is hoping to see.
I hope that over the next 12 months my right hon. Friends the Paymaster-General and the Minister of Technology will be looking at the long-term aspects so that when we come back after the General Election, some time before May, 1971, we will have legislation to establish not separate and competing boards and authorities but one overall, controlling Fuel and Power Authority, each of its sections being able to work together to supply the power that our country needs.
From these benches we have made a case for the coal industry and accepted responsibility. We have not asked for charity. We welcome the support that the Government have been able to give. In turn we will assure the Minister that we will give him and his colleagues all the support we can from now until the next General Election, and when we come back triumphantly to power we shall hope to hear of the work which has been done and will be done through this Bill.
§ 8.43 p.m.
§ Mr. Adam Hunter (Dunferline Burghs)
I welcome the Bill as an extension of the powers contained in the Coal Industry Act, 1967. In saying that I have in mind the benefits accruing to the mining industry from that Act. Also, I am impelled to think of what the position of miners and their families would have been if no scheme of assistance for the mining industry had been introduced in 1967. Such a situation is diffi- 854 cult to conceive. If the Government had continued with their then fuel policy without the 1967 Act there would have been, in my opinion, many difficulties for the industry and for the people working in it. There would have been untold hardship in whole communities. There would have been a great deal of large-scale uprooting of individuals and their families.
I have some experience of this because I know of friends who have had to go across the border into England to work in the pits. Now the situation in my area is such that had those people not left prematurely they would have had a job in the area where they were born and brought up.
So much for the planning of the coal mining industry, but there would still have have been widespread uncertainty among those remaining in the industry. The provisions in the 1967 Act helped to remove some but not all of the uncertainty. This has been reflected in the manpower situation today.
There has been a drift of manpower away from the industry, despite the measures to meet part of the social costs of pit closures. Generally the relevant Section in the 1967 Act dealing with the additional cost to the electricity generating boards for using coal instead of other fuel has had a restraining influence upon the boards. I, and a number of my colleagues in this House, particularly on this side, are appalled by the candid utterances of generating board officials when they declare that they would like to be free from the dependence on coal. Clause 4 of the Bill is designed to facilitate the continuance of the present arrangements.
The powers to reimburse the National Coal Board for losses incurred as a result of deferring pit closures have alleviated likely hardships and prevented a complete collapse of morale throughout the industry. The financial assistance towards redundancy payments and early retirement pensions was a timely and necessary gesture and considerably bettered the position of the older miners, particularly those made redundant.
All the points I have made mean support for the coal industry and it is right and proper that this Bill should extend the provisions of the 1967 Act. 855 The Bill does not solve all the problems of the industry. The hon. Member for Bournemouth, West (Sir J. Eden) said that the industry still faced formidable problems, and that is so. Neither does the Bill ensure the industry's future as a large, efficient and attractive nationalised industry.
It is true that there are to be fewer closures this year. Some of my colleagues have asked for the Minister's assurance about this, but some of them may recall a private meeting we had recently when it was said that there would be few if any pit closures and that if they did occur it would simply be as a result of exhaustion. It is also true that recruitment has improved. It has still a long way to go before the manpower needs are met. A number of viable pits are restricted in their efficiency due to a lack of manpower, which is very serious.
What should be a welcome development is proving to be a source of concern for those with the interests of the industry at heart. I refer to the position whereby demand is outstripping supply, with coal stocks particularly declining. The national position is very serious and in Scotland, with coal stocks half what they were last year, the situation is alarming. The coal stocks in Scotland at present amount to little more than 1½ million tons. The Government should be keeping a watchful eye on falling stocks, because a severe winter could mean that supplies will fall too low to meet demand.
Another difficulty in the coming months will be to do with the supply of smokeless fuels. The Government should add their weight to the pressure being exerted by the Coal Board to slow down conversions to natural gas and to keep the gas coking plants in production for a longer period instead of running them down as is their intention. According to my information, the Coal Board hopes to ease the situation but some time is required before this can be done.
I return to the question of supplies. These depend upon productivity, and it has been said that the increase in productivity in 1968–69 was 9 per cent. A number of speakers deplored the fact that in 1969–70 productivity dropped to under 3 per cent. I understand that the explanation for this, and this is from the Chair- 856 man of the Coal Board, is that it was dut to the fact that extraction was so great. There was an acceleration of extraction so great that it brought about a difficulty in maintaining the development of new production units.
One hon. Gentleman opposite refused to accept this explanation, but had he been a miner and understood the geological conditions of mines he would have understood that it is sometimes difficult to create new development, particularly when there is a shortage of manpower in the industry as it exists today. In other words, the industry was so busy increasing production in 1968 that men and machines were not available to prepare for the next year's production. This was caused by the lack of manpower.
A great deal must be done to induce men to come back to the pits and I hope that the Government will note this point. There must be an assured future in the industry. It is not enough just for the men to know that trends are favourable again. Assurances must be given by the Government—and only Government action can do this—that increased demand for coal is a continuing trend. Only then will ex-miners return to the industry and new labour be attracted.
What many of us feared and what many National Union of Mineworkers' officials in Scotland, past and present, predicted has happened. The time has now come when coal is in short supply. I issue this warning to the Government. Shortage of supplies will not be accepted as an excuse to convert power stations to other fuels. I must inform my right hon. Friend and his hon. Friends on the Front Bench that any attempt to do so will be resisted to the utmost.
Our objections to the rundown of the industry have been justified. The up-to-date position indicates that the run-down has gone too quickly and too fast. There is still time to save the situation. But this can be done only if the Government have the power to do it. This Bill and the Coal Industry Act, 1967, were created because of mistaken Government policies regarding the fuel and energy needs of this country. Nevertheless, I welcome the Bill, but I still feel that the need for it in its present form could have been avoided.
§ 8.53 p.m.
§ Mr. Frank Hooley (Sheffield, Heeley)
The House is bound to be impressed by the long series of speeches that we have heard from hon. Members who represent constituencies where mining is an important local industry. But this industry and the National Coal Board combine in a great and powerful public corporation of unique interest to the economy of the country as a whole. We cannot discuss it as though it were simply the private bailiwick of one particular group of industrial workers.
The other 55¼ million inhabitants of this kingdom have a real lively and immediate interest in the future development of the coal industry and we have an obligation to look at the wider considerations of policy on coal as well as the immediate problems, serious and important though they are, of the mining community.
I do not represent a mining constituency, but my constituency lies within shouting distance of one of our two most important coalfields, South Yorkshire. I am well aware of the social and other problems that arise from the run-down of pits and of the industry generally. In Yorkshire and Humberside, in 1964, the general level of unemployment was 20 per cent. lower than the average for the country as a whole. In 1967, it was 8 per cent. lower. In December, 1969, it was 12 per cent. higher. Those figures derive largely from the run-down of mining in the South Yorkshire coalfield. Therefore, I am by no means complacent about the situation or unaware of the economic o social problems deriving from the declining manpower in the industry.
I welcome the social payments provided by the Bill. I doubt whether there is any Member in the House who would wish to subtract a single pound from the sum the Bill seeks to provide for payment to miners. However, to echo some of the thoughts which have been put forward by other hon. Members, I wonder whether this redundancy scheme is in the best interests of the men who are being made redundant. Is it a good policy to pay off a man at 55 in the sure knowledge that, by the time he is 58, 59 or 60, his working life is finished? In other words, his working life is finished at the age of 55, and there is no likeli- 858 hood that he will ever become productive again. I am not criticising the sums involved, but I believe that this point should be examined.
I was a member of a committee in Sheffield considering the general question of employment in the South Yorkshire area. We were struck by how few miners seemed to apply for retraining. There may be special reasons. Obviously, the nature of the job, the age of the man, and that kind of thing, may represent the reasons why so small a proportion of men made redundant by pit closures apply for any form of retraining. If there are special reasons, any scheme to compensate men and communities for the closure of pits should pay special attention to the problems of retraining, and perhaps provide special facilities or funds to meet these problems, rather than simply confine itself to redundancy payments, full stop.
I welcome the powers given to the Coal Board to offer technical assistance to developing countries. Whatever may be our position in regard to coal, there are some countries in Africa—for example, Zambia and Tanzania—with important coal deposits which they need to develop for their economies. If, through the Ministry of Overseas Development, the Coal Board can offer help to those countries for this purpose, I greatly welcome it and the power which enables it to do so. The only country which seems to be helping the Tanzanian Government to exploit its coal reserves at the moment is West Germany. I should like to think that the Coal Board will exercise the power given in the Bill in a vigorous way to help countries in this position.
I also welcome the power—although I understand it is merely a tidying up provision—which enables the Coal Board to explore for petroleum deposits in offshore or estuarial waters. I believe that this aspect of dealing with the problems of the Coal Board and the coal industry is of the greatest importance.
I believe that public corporations, particularly the Coal Board, will only develop successfully in future if they are prepared and given the powers to diversify their activities into other spheres—usually directly related spheres, but not necessarily. It is in this way that many 859 of the problems facing the Coal Board will have to be solved. It is probably not generally known that the board is already involved in manufacturing chemicals, brick making, and other operations.
In considering the future of the mining communities and manpower in the industry, we should look more to the possibilities of diversification than we have in the past. Although the Bill provides about £70 million of public money to the Coal Board for various purposes connected with its future viability, it provides absolutely nothing specifically for the diversification of its activities. It certainly gives the power, but it does not provide any money specifically for diversification. It may be assumed that the board could borrow money for this purpose, but this would inevitably add to its immediate debt without giving it the opportunity of recoupment.
Reference has been made to the importance of the Coal Board as a possible vehicle for land reclamation. I regard this as extremely important. There was a direct reference in the Hunt Report to the creation of a national land reformation body and the suggestion that the Opencast Executive of the Coal Board should form the nucleus of it and carry out land reclamation on behalf of local authorities. This suggestion should be followed up, and an opportunity has been missed in the Bill to give the Board, explicit powers, if it needs them, to set up such a land reclamation corporation and put it in business in this extremely important social and economic activity.
Apart from the possibility of diversification, the Coal Board should look more closely at its own record and future policy on such matters as the production of smokeless fuel and coking coal. I am not a technical expert in this matter, but it is now 10 years or more since the Clean Air Act was passed. Surely it should have been obvious even to the most obscurantist management that this was bound to have an impact on the demand for certain kinds of fuel by domestic and industrial consumers. It has been suggested that, if there be any fault, it should be shifted on to the Gas Council. That is not fair. After all, the Coal Board is the primary producer in this matter and has clear responsibilities.
860 This is European Conservation Year. Pollution is not only the concern of this and the American Governments, but will be the subject of a highly-organised international conference. It is alarming that we should be forced into going backwards on smokeless zones because of the failure of one of our great public corporations to cater for a need. It is not too difficult to exercise hindsight in these matters, but I repeat that it is 10 years since the Clean Air Act was passed. Other private enterprise bodies have produced smokeless fuels, apparently with some moderate success, yet here we are faced with a retreat on a most important area of our anti-pollution efforts, namely, smoke control.
I am not qualified to comment on the question of coking coal, but it is not good enough for my colleagues to say that they will raise a great shout about the importation of certain types of coal if that coal is vital to the productive capacity of another great public corporation, the British Steel Corporation. If the B.S.C. requires coking coal and cannot get it from the Coal Board, it will have to import it. As the representative of a constituency which is famous for steel, I cannot support the contention that the steel industry should be inhibited in any way in its expansion plans or limited in its output simply because the Coal Board may not be able to supply this form of raw material.
§ Mr. Ogden
I do not wish to introduce a note of controversy, but is my hon. Friend suggesting that the coal industry is inhibiting the steel industry? Has not the steel industry grown, flourished and thrived on the cheap coal which has been provided uneconomically by the Coal Board? In addition, are not the needs of the steel industry provided not only from the coal industry, but the gas industry and everyone else?
§ Mr. Hooley
I was not referring to the past, but to the future. The whole drift of my arguing on smokeless fuel and coking coal is that a great public corporation like the Coal Board needs sufficient forward planning to ensure that these needs are met.
The Board cannot constantly expect other public corporations—gas, steel or electricity—to bail it out of difficulties which it may run into either because of 861 its own fault or because of other faults. There is not necessarily a responsibility on gas, electricity, or steel to bail out the coal industry every time it runs into some trouble, part of which may be of its own making or come from its own lack of foresight.
§ Mr. Hooley
This part of the illogicality of my hon. Friend's complaint. On the one hand, he says that there will be a ghastly row if coking coal is imported, and the next moment he says that we could not possibly import it anyway.
I am simply saying that we could not tolerate a situation in which the steel industry might be inhibited from expanding production because the coal industry was not able to produce this particular raw material and the steel industry was prevented from—if it could do so—obtaining it somewhere else. The coal industry cannot expect to proceed always on the basis that its problems are transferred to some other public corporation. I make that point because I believe it to be important.
Now, the question of the subsidy to the C.E.G.B. to burn coal in cases where it would not normally do so. I say frankly that I am opposed to this. I am not apposed to the expenditure of the £30 million on the coal industry if it needs that money for its viability in either a social or economic sense, but I do not see the justification for compelling the C.E.G.B. to burn coal which it neither wants nor needs. In any case, there is a strong social case against it, because—I come back to the problem of pollution—power stations are a serious source of pollution, and in this day and age we should be cutting it down, not perpetuating or increasing it.
I remind some of my hon. Friends that coal has killed 100 people outside the pits for every one killed inside the pits. The incidence of bronchial and other diseases—[HON. MEMBERS: "Oh."] There is no "Oh" about it; this is irrefutable. The incidence of bronchial and 862 other diseases caused by air pollution has brought about far more deaths in this country over the centuries than the number of deaths in the pits, regrettable though both are and have been. I want to see a reduction in this kind of pollution, not a perpetuation or increase in it.
I should view not at all in a good light the proposition that we should deliberately seek to perpetuate the demand for coal by this subsidy to the C.E.G.B. I am surprised that the Government have not given more thought and attention to the management of demand and supply save by this technique. As I understood what my right hon. Friend said earlier, this was to be the main technique for balancing supply and demand if supply ran into surplus. We might well have explored other methods of doing it, without resort to the crude technique which we have employed over the last three years of simply paying the electricity industry to burn coal which it does not need and does not want to burn. That cannot be a sensible employment of public funds, though—I wish to make this quite clear—I am entirely in favour of making this sum available in some other way if it is necessary to ensure that economic or social viability of the coal industry.
There is no divinely given law that we must consume a certain quantity of coal. If a given quantity of coal is not required, we must offset the social consequences of this for the people in the mining communities. I support that, and I would support the provision of an even greater sum than the £22 million set out in the Bill if that were required, but I do not support this artificial consumption by the electricity industry of this quantity of coal, merely for the sake of burning coal which otherwise would not be used.
To sum up, I support the social payments proposed under the Bill. I support the diversification of the interests and activities of the Coal Board. Indeed, I am sorry that the Bill does not provide more directly for an even wider diversification than is allowed for. I am against the creation of an artificial market for the burning of coal by the electricity industry by providing a special subsidy. I think that there is a case for a more sophisticated examination of the social 863 and retraining needs of the miners who are made redundant.
§ 9.11 p.m.
§ Mr. Edwin Wainwright (Dearne Valley)
I regret the intervention of my hon. Friend the Member for Sheffield, Heeley (Mr. Hooley) who has said some things which one feels justified in criticising. First, he can close all the pits, provided that he finds alternative employment for the miners. I recommend my hon. Friend to visit some of the villages in which there are miners who have been thrown on the scrap-heap and talk to them about pollution. I am against pollution, but it is no good talking about pollution to miners who have no income. When I say "no income" I mean that their only income is what they receive by way of social security benefits. I agree that these are not too bad, but he will not find many workers similarly placed in the steel industry, which he represents.
I think that we should learn from our experience of the 1965 and 1967 Acts. Although those Measures have been good, in the sense that they have been helpful, they have left in their wake quite a lot of misery, and there is more misery to come. It very often does not mean a lot to a man when he is told that he can retire at 55 on nine-tenths of his wages. Some people, because they have been off sick, or away from work as a result of an accident, averaged only a low wage, with the result that they receive only a few shillings extra for the three years, at the end of which time they are thrown on the scrap-heap.
We ought to determine to find alternative employment for miners who are unable to continue working in the pits. When the Bill becomes an Act a miner will be entitled to nine-tenths of his pay for three years after becoming redundant. It would be far better to find him a job, but that is almost impossible. On reaching the age of 60, men should be paid for five years, until they reach pension age. At the moment they are inclined to accept the three-year offer because they cannot find employment outside the mining industry. The result is that for the last two years before they reach pension age they drop back to living on social security benefit. I think that a 864 man who has worked in the mines for 40 or 45 years is entitled to a reasonable pension.
I hope that we shall be rather more generous to the miners than we have been so far. We ought to learn from the last two measures that we have missed something. We ought to learn that we have not really taken into account the human misery that we have created.
Because of the time factor, I cannot discuss all the details that I should like to put to the House. There has been a lot of talk about morale in the industry. Industry cannot be contracted without upsetting the morale of the people, unless other jobs are supplied. It is not easy for people to transfer to other areas. It is not sufficient to say to a man, "We will give you so much for moving." He has to take his wife and children, there are jobs to be found for his children if they are of working age, or schools to be found for them. All these things have to be taken into account and it is not acceptable to upset families like that.
What is wrong with some of my hon. and right hon. Friends is that they are too professionalised. Being in the professions, they know that during their lives they will have to move on many occasions and are prepared to do it, because that is how they get promotion, that is how they get their "lolly". That is not so with the ordinary worker. We have not yet arrived at the position when he is trained to think that he moves to get promotion. He is moving to get a job, sometimes worse than that which he is leaving.
I promised that I would sit down soon to allow my hon. Friend the Member for Sunderland, South (Mr. Bagier) an opportunity to say a few words so that I shall have to leave out much of what I had wanted to say. I do want to say one thing to my right hon. Friends. I noticed in the Sheffield Star yesterday that the jobs of 6,000 men in the South Yorkshire coal industry will be in jeopardy if a West Riding County Council planning department decision is not reversed. The Manvers Main coal preparation plant, which is responsible for three other pits, Wath, Barnburgh and Kilnhurst, making four pits in all, wants an extension to its tipping area and the county council is refusing planning permission. I know 865 that it is not within my right hon. Friend's Department, but the coal mining industry is and there are 6,000 jobs at stake here. I hope that he will use his influence with the Minister of Housing and Local Government, to whom I have tabled a Question.
The coal industry has given a lot to this country. When people talk about importation of coal it should be remembered that it cost the nation thousands of pounds a year ago to import coal. I hope that that will be taken into account. I have deliberately cut my speech short. I had wanted to say something about smokeless fuel.
§ 9.19 p.m.
§ Mr. Gordon A. T. Bagier (Sunderland, South)
I am grateful to my hon. Friend the Member for Dearne Valley (Mr. Edwin Wainwright) for allowing me this time to raise a point which was touched on earlier by my hon. Friend the Member for Wallsend (Mr. Garrett), who mentioned the question of timber spoil heaps and pit heaps.
Briefly, the problem, about which the Paymaster-General already knows, is that these heaps are a source of income for the Coal Board and ought not to be put in jeopardy by any other Government Department. However, these heaps are in danger because of a rating charge for shifting them. The Government are prepared to pay 85 per cent. towards the cost of removing them, provided that local government provides the other 15 per cent. Manufacturers and contractors are prepared to shift the heaps, and to pay for the material, used as under-fill for motorways. In my area there is a big motorway programme going on and there is a danger of these eyesores not being shifted purely because of this rating charge.
There is a possibility—I put it no higher than that—that as long as these pit heaps could be literally given away by the N.C.B. or be provided for a nominal fee, they could become an export. The Dutch are interested in spoil and are badly in need of in-fill. I hope that this matter is being looked into.
I cannot understand why, on the one hand, the Government are prepared to pay 85 per cent. of the cost of shifting or otherwise dealing with these tips, as long as the local authority provides the 866 other 15 per cent.—though some bright boy has decided that they should be rated at 2s. per ton, which makes the whole thing uneconomic—and, on the other, we believe in reclamation and doing something about these eyesores.
I trust that my right hon. Friend will impress on his colleagues the urgency of dealing with this situation. The N.C.B. could have an important source of income from what in the past have been regarded as eyesores. If a change in the law is required, let that be done and let us arrive at a new formula so that we may get rid of these tips.
§ 9.22 p.m.
§ Mr. Patrick McNair-Wilson (New Forest)
As befits an industry as important as the coal industry, this debate has been interesting and thoughtful. We have had many moving speeches from hon. Members on both sides of the House and I join with those who have congratulated the hon. Member for South Ayrshire (Mr. Sillars) on an outstanding maiden speech.
I had the privilege, in 1965, of winding up the debate on Third Reading of the Coal Industry Act of that year. That debate differed substantially from what we have had today in that it was a point in the history of the industry when the desire to contract was perhaps more important than anything else. The opening speech of the then Minister of Power contained this observation:Yet the industry is of its very nature inflexible, and capacity once lost can be recreated only at heavy cost and with great difficulty. It would be a matter of national concern if the industry's markets declined faster than output could in practice be economically reduced and the social disturbance dealt with in an acceptable manner.He added:I emphasise that this huge on-cost of uneconomic coal is one of the greatest threats to the prosperity of the whole industry. Thus, I believe that it is necessary for the Coal Board to accelerate its policies for consolidating production in the economic pits and improving efficiency."—[OFFICIAL REPORT, 25th November, 1965; Vol. 721, c. 780.]The situation we face today is very different from the one we faced in 1965, because today we face a shortage.
It is fair to say that energy forecasting is one of the most difficult tasks in the world. It is certainly not an exact science, though it may be an art.
867 Most forecasters have been proved wrong. We can be certain, however, that we are facing a changed situation.
Change in the coal industry is nothing new. It was clear early on that the competition from new fuels would mean that this industry would contract. We therefore accept the Bill because it continues the job of supporting those who have been overturned by the changes which have taken place, and does something to alleviate the social consequences of those changes.
There is, however, a danger that in the coal industry today we face what may become a story of lost opportunities. We have had so many different promises for the success of this industry, but the performance has not lived up to those promises. There are obviously major problems in an extractive industry in that capital investment is substantial and time can be of great importance.
Some of the problems which the industry is facing now were, I believe, foreseeable. After all, a great deal of public money has been invested in this industry; about £300 million on face machinery, and all sorts of new techniques have been introduced. Many of us remember how we were told that the Colins Minek would rip coal out of narrow seams and transform the whole pattern of mining. Then we had the R.O.L.F. process, a highly sophisticated system. There is the manless pit of Bevercotes and even the problems, referred to by some of my hon. Friends, of Dr. Bronowski.
My hon. Friend the Member for Meriden (Mr. Speed) spoke about new types of mining which are being introduced, retreat mining and so on. These add up to a number of what could have been highly successful operations, and we hope that they will be successful in future. Nevertheless, there is a fear that we may be losing opportunities. As my hon. Friend the Member for Honiton (Mr. Emery) pointed out, the figures which we are taking as examples of how this industry should develop now clearly need revising.
I wonder whether the Minister would stand by the figure of 120 million tons in 1975, or whether the figure of 10 per cent. rundown in manpower is one which 868 we would accept today bearing in mind all the things that have changed in the recent past. The Deputy Chairman of the Coal Board said as recently as last December:There is not enough coal to meet requirements.When that comes from a man of his eminence, one has to take some note.
§ Mr. McNair-Wilson
That was the point I was making when I referred to the speech made by the right hon. Member for Newton (Mr. Frederick Lee). I think that this rate of redundancy may have produced exactly the situation the hon. Member has described.
Some of the problems were, of course, unforeseen, for instance those in some of the 500 megawatt sites where we have had to press into service older generating plant and, therefore, the use of coal has been at a much higher level than was expected. For that reason I am not convinced that the Clause in the Bill which deals with the support of coal in this context will be necessary.
Then we have the problem referred to by some hon. Members of the acute shortage of coking coal. The hon. Member for Sheffield, Heeley (Mr. Hooley) made some very courageous remarks when he referred to the problems of importation. The Minister said, opening the debate, that his right hon. Friend, when winding up, would give a clear indication of the Government's attitude to importation. I think that was in reply to an intervention by the hon. Member for Midlothian (Mr. Eadie).
§ Mr. McNair-Wilson
The right hon. Gentleman asks for my views, but he must realise that he is a member of the Government and I am not. We have to face the effects of shortage as they might affect the steel industry. The situation at the moment is serious.
The Bill deals in part with aspects other than the social problems of the coal industry. For instance, it allows the industry to borrow overseas. I wonder why that Clause is in the Bill? It may 869 be, as was pointed out by the Minister, that this brings it into line with what is being done under other nationalisation Acts. My guess is that the money may be used as I thought the Minister of Technology suggested, for looking towards oil exploration, but the right hon. Gentleman corrected my hon. Friend when questioned on that. I agree that money should be made available for technical assistance because in countries such as Australia there may well be areas at which one wants to look for exploitation of the coal we are short of.
Since the British coal industry probably has more experts than almost any other coal industry in the world, it is obviously sensible that we should share some of that expertise. There is also the question of allowing the N.C.B. to go into those areas on the Continental Shelf that it is not now allowed to enter, like, I think, the Minch and the Wash.
In his usual lucid and expert way, my hon. and gallant Friend the Member for South Fylde (Colonel Lancaster) said many things to which I should like to refer, but there will not be time. In connection with the parts of the Bill dealing with the social situation, he pointed out the problem of finding new work for those miners who have become redundant. Many hon. Members have expressed concern about the need for employment as perhaps the most important aspect of the matter. I know the Swansea Valley reasonably well. At the top of that valley we have seen industries set up, like the Smith's Watch Co. at Ystragyndlais, but very often the work available is the wrong sort.
I hope that the Minister will bear in mind the question of employment, because it is central to the success of his social programme for those miners who must leave the pits because of closures. The money provided for the period 1967 to 1971—£115 million—has been only about half used up. It may well be that as a result of the slowdown of closures, because of the shortages I have described, much of the money now being provided will again be unnecessary. But even so we face the great problem of running down an industry and controlling the rate of rundown to a point where we are not faced with serious shortages.
The productivity point raised in the debate gives ground for concern. It has 870 been argued that because of the technological changes—the new forms of equipment being used, the retreat mining, the panels, and so on—it is not possible to switch from one area to another quickly enough. But if this is the case it is very worrying, and new production targets will have to be set. That is why the question of importation must be discussed by the House.
§ Mr. Edwin Wainwright
Does the hon. Gentleman agree that the information I have received is correct, that during the past 12 months or so there has been so much development work, so that we can do the retreat work after we have done the development, that it slows down production throughout the industry?
§ Mr. McNair-Wilson
I do not dispute that. I know that the hon. Gentleman is an expert in the matter, but I still think that we might be slightly concerned about the productivity level, which has gone from an increase of about 10 per cent. to one of about 2 per cent.
There is also the problem of stocks, which have fallen by about 10 million tons over the past year. In some places they are so low that what is available requires something of an archaeological feat to separate from the mud and slime, because some of the stocks have been on the ground for many years.
This leads to another problem, the shortage of smokeless fuel, which has been raised by several hon. Members. Since he has held his present appointment, the Paymaster-General has had an opportunity to consider the problem in detail. The reasons for it are well known—the switching away from coal gas either to oil or natural gas.
The Chairman of the Coal Board is now predicting a shortfall of about 700,000 tons next winter. He has made it public that he regards this as a serious situation. The Paymaster-General accused me in the House in February ofseeking to exaggerate these minor matters…He also said:I do not pretend to be an expert—in fact, I am rather new to this subject—I am not trying to be clever here, I am merely saying that the right hon. Gentleman has had time between 3rd February and today to look again at this matter.
871 I believe that this is a serious matter, not on the evidence of the chairman of the Coal Board, but on the evidence of my constituents who write to me and whose letters I send to the Chairman. I have here a letter from a lady living in New Milton, who says:Last year I got my winter fuel in during the summer. It was so dirty that a lot went into the dustbin. Consequently, I am now without, for the first time in 45 years. My fuel merchant can see no improvement in the future.I am anxious that we as a Parliament should get this right. I am saying that there is a shortage and that there are ways in which the situation could be alleviated. It might be done by changing boilers in the schools, and so on, but I believe that the Minister will have to do something. We have six months between the end of this winter and the beginning of next winter; whatever is done, it will be a very tight fit. In winding up the debate on 3rd February, the Paymaster-General said:I can tell the House that there will be no hardship this winter and there will be no hardship next winter."—[OFFICIAL REPORT, 3rd February, 1970; Vol. 795, c. 339–44.]I hope that he is right. If he is not, people will be shivering in their houses, unable to keep themselves warm and children will not be able to have a bath. He will be responsible if he still maintains that everything is all right when, in fact, it is not.
The Minister of Technology cited three parameters for a fuel policy. He set out what he thought were the three essentials. The last of those three essentials was the balance between supply and demand. I would be the first to admit the difficulties of forecasting. I would go further and would say there are probably dangers in publicising targets. I remember the 200 million figure which was bruited about for years on end when it was quite obvious that it was unrealistic. What the coal industry is about is producing as much as it can sell competitively. That is the final package one would like to see developed.
The market for the coal industry is very buoyant at the moment. My hon. Friend the Member for Canterbury (Mr. Crouch) spoke of establishing stability and confidence. It is tragic that, after all the violent surgery on this industry, 872 all the misery, the hardship, the social problems, and so on, to get it down to what we were told was the right size, the market is now buoyant and we cannot provide the product. This must be a serious blow in terms of morale to those who work in the industry. If we do nothing else here tonight, we must establish that the people to whom I have referred, who have carried a tremendous burden and who have lost their jobs, must not be let down by the Government or by the management of the Coal Board.
§ 9.40 p.m.
§ The Paymaster-General (Mr. Harold Lever)
We have had a very good debate, although I confess that the few notes of controversy have been in a sense welcome, because this House lives on controversy but does not thrive too well on blissful harmony of opinion. I would not welcome controversy on the main theme of the Bill and I am glad that there is none. Most people on both sides of the House recognise that the Bill is right to continue the broad pattern of support which has been established.
There are two classes of reaction towards miners, I find. There are those who, when the miner shows the smallest sign of prosperity suddenly imagine him as indulging in every kind of extreme luxury and show obvious signs of begrudging it, and there are those, on the other hand, who idealise the miners. I am much more ready to find myself in the second category, having known miners since my early professional life and having been born in Lancashire and seen miners from my early youth.
They are a great section of our working people. They have the kind of open-faced, open-hearted approach to life that people tend to have whose lives have been set in a background of wrestling with nature rather than with their fellow men. They have not perhaps learned the arts of cunning and greed as well as some of us who live in a somewhat different atmosphere. I felt privileged to do work in my Department relating to the mining industry and I hope that I will continue to approach the miners as I have done all my life, with the greatest admiration for what they have done for the nation, in peace and in war. They have always shown a discipline and sense of patriotism which cannot be exceeded in any part 873 of the country or in any class of the nation.
Although my right hon. Friend is right to claim that the level of support offered since the 1967 Act and in this Bill can be described as generous, it can only be so described by the relative standards of what the miners have enjoyed in relation to the past history of their industry, when they have often been treated very meanly indeed. I can only say that although I accept this is generous support, generously continued, it certainly is not a penny more than I would find acceptable for supporting the industry and the miners who live from it.
The fuel policy will continue to be backed by the broad support for coal which has been outlined in the Bill and in detail by my right hon. Friend. I have taken note of the eager desire for information from many quarters of the House, for a new White Paper, more information, more forecasting and projections and the like. I thought that the case was argued cogently, with passion mixed with moderation, by my hon. Friend the Member for South Ayrshire (Mr. Sillars) who made a most impressive maiden speech. I am sure that the House will be delighted to hear from him again. He spoke with cogency, knowledge and great sincerity and I am sure that everyone enjoyed his intervention, which was a valuable one.
Nevertheless, I hope he will not mind if I say that on the one hand he argued that we ought to have a new White Paper while at the same time he pointed out the damage to morale caused by the 1967 White Paper. We have had the same duality of view, and I do not complain about that, from the other side of the House. The hon. Member for Honiton (Mr. Emery) is making a passionate and detailed case for more projections while his hon. Friend the Member for New Forest (Mr. Patrick McNair-Wilson) says that he does not want to hear any more of these targets; he is against setting targets and he wants to get on with the job. He is quite right, that is what we are trying to do.
I can at least give the House this information. The output for total energy demand is expected to be, if anything, rather higher than was forecast in the 1967 White Paper.
§ Mr. Lever
I cannot go beyond the broad estimate that I have given. The consensus was that we ought not to engage our minds on targets and projections but rather on broad brush estimates of this kind. This offers to the coal industry, if it gets its share, as it can, a prospect no less promising than the 1967 White Paper, if anything more promising. It is a matter of whether the coal industry can be competitive enough to win more than the share of the market expected in the 1967 White Paper.
If it does win that share expected in the 1967 White Paper, that will in absolute terms be somewhat larger in tonnage than was forecast in the White Paper. It is impossible to make a detailed prediction except for the purpose of giving people debating points at some later time. I can only repeat what my right hon. Friend has said on this point—that the share of that somewhat larger market will depend on the competitiveness of the coal industry and that depends, in turn, on the productivity increases being maintained and the competitive prices which will result from it.
I think also that flexibility has to be the keynote in Government policy addressed to this industry because without that flexibility, since it is not given to us to be able to forecast the demand and supply with any precision, one has to have a national capacity, when demand is running too low, to even things out, by, for example, burning coal at electric power stations, and the like. When demand is greater than supply—as may well be the case this winter—one gives oneself flexibility downwards by having conversions to dual-fired electric stations, such as Hams Hall.
My hon. Friend the Member for Sheffield, Heeley (Mr. Hooley) said he did not think that that was a good idea—the electric coal burn—as one of the ways of taking up excessive supply or evening out the supply situation. But he was not copious in his suggestions of alternative ways. He just airily indicated that a better way should be found by the Government. I take that as the usual compliment for the Government which implies that in their wisdom they can find a better way than the present one although the critic rarely can. He 875 did say, I do not doubt with great sincerity, that the Government should write a cheque out to meet the social consequences of throwing people out of work if we cannot burn the coal. But those miners do not want cheques for redundancy. They want work and preferably work in their craft, but it is work that they want and not redundancy payments. We shall take all the measures that a Government can take to see that they have the opportunity to work for their living, because no one is more willing to do so when the opportunity arises than the miner.
§ Mr. Arthur Palmer (Bristol, Central)
My right hon. Friend is right in saying that flexibility is needed in the firing of power stations, but why has his Ministry been so slow in allowing dual firing in power stations?
§ Mr. Lever
I am not aware that in dual firing we have been slow. I think that what my hon. Friend may be confusing is our reluctance to grant conversion to oil where this would permanently put out the possibility of coal burning. So far as I know, we have shown considerable flexibility in dual firing, adequate, no doubt, for the purposes which we have in mind. As my right hon. Friend has said, the point is that we do not intend in the interests of flexibility permanently to knock out a coal-burning station because of some temporary shortage. It would hardly be fair to the industry to do that. If there were to be a permanent shortage of coal that would be another matter. But we do not want to knock out for ever a coal-burning electricity power station because of a temporary shortage. That would not do.
A great many hon. Members have talked about the redundancy scheme. I hope that hon. Members on both sides of the House will forgive me if I do not go into detail. The details of the redundancy scheme are not even for the Committee stage, but for the tripartite discussions between my Department, the Coal Board and the miners' unions. No doubt the interesting suggestions will be noted in the appropriate quarters and I hope that they will be pursued because some of them sounded very good. But it is not for me to deal with them here.
876 A matter of great importance raised in the debate has been that of coking coal. I notice that the hon. Member for New Forest rather took the view that it is only for the Government to have views. He said that he was rather reluctant to offer them. He said, "You are the Government. You should have the views." I must confess that this throws some enlightenment on some of the speeches we have heard from hon. Members opposite, not only today but earlier, because one now realises that the Opposition have abdicated any obligation to hold views. What they put forward as what we thought were views, can now be seen in a different light because he has freely confessed that he has no obligation to hold views. I shall not be either ambiguous or difficult about it.
The simple position on coking coal is that the retention of the ban on coal imports since 1958 is and will continue to be a plank of the Government's policy for the protection of and assistance to our coal mining industry. Having said that, I draw the attention of the House to higher authorities even than my right hon. Friend the Minister of Technology, if he will not mind my saying so. The Almighty, in His geological allocations, has, I fear, given us only a limited quantity of reserves of high quality coking coal. I have often complained that we have been censured by the Opposition for shortfalls of national and private industries over which we have no direct control, but I trust that we shall not be censured for the decisions of even higher authorities than that.
§ Mr. Speaker
Order. It will help the Press Gallery if the right hon. Gentleman addresses the Chair.
§ Mr. Lever
It is possible that the point will be reached when the steel industry will need high quality coking coal beyond the resources available in this country to meet it and it may be possible to get this from abroad. All I can say about that is that, if importation of coking coal is permitted, it will not act to the detriment of our own industry. It will be a necessary suport of our own coking coal industry if we have to bring in coking coal of a very high quality to blend with some of our own.
This matter must be studied. I am not a technical expert on it. But there is no 877 doubt that a situation could be envisaged in which we should need coking coal imports of high quality for blending with and supporting our domestic product. I hope my hon. Friends have understood that this would not be to the detriment of the coal industry but would act towards the enlargment of the sale and production of coking coal. It would not mean any reduction. In other words, I cannot be expected to ban in advance imports of coking coal where a ban would actually result in a reduction in coking coal mining in this country. My hon. Friends would inevitably be driven after an interval to plead with me to take off such a ban.
I cannot give details of this matter because the British Steel Corporation and the N.C.B. are reviewing requirements and procurements. When I have heard from them, I shall have no difficulty in informing the House and my colleagues from the mining areas in particular and stating the situation as we see it. It will be dealt with then. Naturally, we are anxious to ensure that there shall be no imports of coal to the prejudice of the miners. The only imports of coal which may be thought about are imports necessary for the advantage of our coal industry. That is the Government's policy, as it always has been. Indeed, in fairness, I should remind the House that it was also the policy of the Conservative Government.
§ Mr. Crouch rose—
§ Mr. Lever
I hope that the hon. Member for Canterbury (Mr. Crouch) will allow me to get on. If he interrupts me, it will deprive him of my comments on smokeless fuel. Although he has had it pointed out to him that I do not myself make smokeless fuels, and therefore cannot personally meet the shortage even by a constant stream of good advice to those who do make it, he knows that a certain amount of popular mileage is to be made on this matter and he is not going to miss any opportunity of doing so. The hon. Gentleman is not going to miss any opportunity to do so.
When I said to him that he was exaggerating a minor matter I was not referring to next winter's coal. I would ask the hon. Gentleman what he thinks I ought to do beyond what I am doing. 878 I am encouraging by every means in my power the making of the maximum quantity of solid smokeless fuel between now and the winter. Nobody has ever alleged that I am not. All they are saying is that there will be a shortage. They are not saying we are at fault or that there is something which we ought to do which we are not doing.
One hon. Member thinks we should stop closures of gas works. That is a matter for decision by the Gas Council, but the hon. Gentleman suggests an unlimited subsidy of anything up to £30 a ton for uneconomically produced coke from gas works. That is really going a little too far. I cannot forecast demand, but I am afraid there is no doubt that next winter a tight position is likely to exist. I can only assure the House that I and my Department are doing everything possible to deal with the situation in terms of conversions, even in the gas industry, which is a matter for the Gas Council. I have asked the Council to look again at its closure programme to see whether there is, after all, the possibility of keeping for rather longer some works which could produce coke, admittedly at a price higher than the current price but still within the range of prices which the consumer can be expected to accept.
Many complaints of shortage of coke come from people who have allowed themselves to be dependent on hard coke where they are in direct competition with steel works in the search for this coke in a diminishing market. What does the hon. Gentleman want me to do about it—to close steel works or try to get hard coke which is unobtainable anywhere in the world in the necessary quantity? The real truth is that those who have been dependent on hard coke have been well aware for l0 years that the supply of sofe coke from the gas industry was going to diminish; and they ought to have been well aware that the world demand for hard coke has been growing, that the market has been getting tighter.
The Government are not the wet nurse of every consumer of every commodity in this country. Some people have to take action to look after themselves. It comes very oddly after hearing some of the comments from the other side that those hon. Gentlemen should seek to exploit this grievance or encourage people 879 to believe that it is the Government's responsibility, in all circumstances, to find them the necessary coke supplies which at the present time are short throughout the world.
All I can say is that the Government will do their duty which is to help by every means in their power towards a solution of the problems of citizens who are short of supplies; but the Government cannot undertake to plan their boiler systems for them.
§ Colonel Lancaster rose—
§ Mr. Lever
I really must say a word before I sit down on the problems of closures. I have dealt with the Bill and I thought I had dealt with the hon. Gentleman's point as far as I understood it. I am not able to deal with all the detailed questions which are outside the Bill. Next is the question of pit closures. In the few moments at my disposal I can only say that pit closures in 1969–70 have dropped from 50 to 55 in previous years to 19. I can only say that the Chairman of the National Coal Board has indicated that he hopes closures will be kept in the region of 10 to 14 in the current year. I can only say that this is clear evidence that the worst days of pit closures are over, and I look hopefully to the future when the industry will be fighting to achieve viability on a streamlined basis.
§ Question put and agreed to.
§ Bill accordingly read a Second time.
§ Bill committed to a Standing Committee pursuant to Standing Order No. 40 (Committal of Bills).