HC Deb 02 February 1977 vol 925 cc704-16

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Frank R. White.]

11.8 p.m.

Mr. James Sillars (South Ayrshire)

I am doubly blessed, to be successful in the Ballot and to have this debate come on early on a day on which the Scotland and Wales Bill has been discussed.

This is a welcome opportunity to place before the Minister of State my anxieties about the economic future of those parts of South Ayrshire which remain heavily dependent on the coal mining industry.

In Cumnock and Doon Valley district, the mining industry is at one and the same time our pillar of strength in respect of male employment and our Achilles heel. What is good for the coal industry is good for Cumnock and Doon Valley, and what is bad for that industry is very bad for the people living there.

In Kyle and Carrick we have the mining village of Dailly whose life is presently threatened by the possible closure of Dalquharran colliery. Dailly lies within the Girvan employment exchange area where unemployment among men is already 14.3 per cent. The closure of Dalquharran would push that rate up to about 18 per cent. if no alternative jobs are made available.

In South Ayrshire we have many of our industrial and employment eggs in the coal basket and, given the continued decline in the number of collieries and mining jobs, this has been a constant source of apprehension and anxiety for all concerned with the well-being of the community.

Due to crass errors of judgment over the availability and possible price of oil, both Tory and Labour Governments ran down the coal industry in the late 1950s and throughout the 1960s, and in Ayrshire that decline has continued. In recent times we have lost Littlemill, Cairnhill and Minnivey. Now Dalquharran is threatened, and Pennyvenie in Dalmellington is known to have a limited life. There have been no new sinkings, and no indications have been given that the National Coal Board, the Governmnet, or the strategic planning authority, which is the Strathclyde Regional Council, see anything but a declining future for the industry.

The Ayrshire coalfield is, of course, extremely vulnerablue. Our major markets remain electricity generation. Seventy per cent, of total Scottish coal production is burned in South of Scotland Electricity Board power stations, and the manpower requirements of the future will greatly depend upon the coal requirements of the SSEB. In geographical relationship to the coal-burning power stations in the East, the Ayrshire coalfield, in the West is at a disadvantage.

But even more worrying is the background against which the coal industry is operating. We are now moving into the decade of maximum danger for the coal industry because of past planning decisions on certain types of power stations and our general level of economic performance. A letter to myself from Sir Derek Ezra, Chairman of the NCB, dated 23rd December, spells out the serious nature of the problem: After a record coal burn in 1975/76 coal consumption is now on the decline as a consequence of the commissioning of the first set at Hunterston B nuclear power station at a time of near stagnant growth in Electricity demand. With the imminent commissioning of the second set at Hunterston B followed in 1977/78 by Inverkip oil-fired power station and then by Peterhead oil/gas station in the years 1978 and 1979, prospects for coal are not good unless there is a very considerable surge in demand for electricity coupled with a minimal use of fossil fuels other than coal. In anticipation of a potentially rapid and marked run-down in demand for Scottish coal which would radically affect employment in the Scottish coal mining industry, the SSEB and NCB have jointly put to Government certain proposals designed to stabilise SSEB coal consumption at a level acceptable to the Board. I do not know what those "certain proposals" amount to, nor do I know whether what would be acceptable to the Coal Board would be acceptable to or entirely good for the industry in South Ayrshire. But it is obvious that unless the Government take action to guarantee that coal burn is the priority burn, the Scottish industry is in serious trouble, and none more so than the Ayrshire coalfield. A word from my hon. Friend the Minister of State, Scottish Office, on this in this debate would be most welcome. Incidentally, I welcome the at tendance of my hon. Friend the Under-Secretary of State for Energy.

Given the state of the Scottish economy at the present time, with 183,000 people out of work and about 43,000 people kept off the register through temporary job creation schemes, there is a compelling need for the Government to maintain mining jobs when it is in the Government's direct power to do so. They have that power in respect of the SSEB, a body directly responsible to the Secretary of State for Scotland.

A nagging worry at the back of everyone's mind in Ayrshire is that even if a good agreement is reached between the SSEB, the NCB and the Government, we in Ayrshire will remain exposed and vulnerable because it is possible, even with the best will in the world, that we could end up with about 1 million to 1¼ million tons surplus to market requirements by around 1978–79. All of us in Ayrshire know where the major part of that surplus will come from.

Market availability is critical in sustaining the Ayrshire coalfield and the economy of my constituency. If there are question marks over market outlets in the Scottish economy, we are entitled to look for outlets in the wider economy of which we are now part—the EEC.

I can recall, as I am sure the hon. Member for Ayr (Mr. Younger) can, some of the propaganda dished out in South Ayrshire during the Heath effort to get us into Europe. One broadsheet handed out to miners by some pro-European Labour organisations boasted of a coming gold mine for Scottish pits when the markets of Europe were opened up by our entry to the EEC. There were no ifs and buts, and the lavish promises were backed by quite extravagant language.

We are in the Common Market and the time has come to redeem the pledges. The mining communities of South Ayrshire have been forced to accept the many disadvantages that have arisen because of our Common Market membership. It is about time we felt some advantages, and that can come if the British Government are forceful enough in pressing our case in Europe before that of countries outside the Common Market.

In 1975 countries in the EEC imported over 41 million tons of coal from countries outside the EEC, much of it from places like Poland where, due to their currency difficulties, they do not hesitate to sell below the cost of production.

With an import consumption capacity of around 41 million tons, there is plenty of room to squeeze in that 1 million to 1¼ million tons that would transform the prospects of the Ayrshire coalfield. I think, given the shameless way in which promises were made to people in the mining industry by those Labour promarketeers, we in Ayrshire are entitled to demand that the Government take the necessary action to secure a market for our coal within the EEC. It can be done if the political will is there on the part of the Government.

The Government should tell the European Community that, from a Scottish viewpoint, it is not good enough for it to say that it will be happy to take our oil, but not our coal. I know that such a statement will somewhat upset my hon. Friend the Minister of State, who will not like the implication that it is "Scottish oil". However, it will please the hon. Member for Dundee, East (Mr. Wilson). I do not go along with the SNP slogan with respect to oil, but I must say that I find the logic of some Unionists and the European Community very strange. When it comes to a highly desirable substance such as low-carbon-based oil, they say that its ownership and control must be much wider than its indigenous Scottish cource. But when it is coal which, because of geology, is more expensive from Scotland, they are quite happy to describe it as "Scottish coal" and a problem for the Scottish economy alone.

The fact is that both oil and coal are indigenous Scottish resources, and we should not allow the European Community to have full and free use of the former while exercising the right to reject the latter. especially when so many jobs are at stake in our mining industry. Securing a market for Scottish coal within the EEC would do much to secure the mining jobs we now have in the Cumnock area.

It may seem to the Minister that I have painted an all too black picture of our prospects in the Ayrshire coal industry, and that the emphasis on the need for new market outlets in Europe is not fully justified. I would imagine, however, that the brief prepared by his Department and the advice given by the Department of Energy confirm the reasons for my anxieties.

If that is not the case, I would refer him to the report published by Strathclyde Regional Council, which makes extensive references to the position of the mining industry in South Ayrshire. Indeed, I am sure it is the implications of this report which have prompted Councillor Willie Goudie of Strathclyde Region to call for the designation of South Ayrshire as a recovery area attracting money and rehabilitation projects. Willie Goudie's idea is an excellent one, and I would urge the Government to take it on board and ultimately give effect to it.

The Strathclyde Report makes unpleasant reading. In a passage named as the "Summary of Key Issues" it states that in Ayrshire as a whole there could be a net loss of 20,000 jobs by 1983. Later it asks on page 29: Can a solution be found to the problems of long term unemployment in the South Ayrshire coalfield? The link between the coal industry and South Ayrshire's economic and employment prospects is a constant theme in those parts of the report relating to Ayrshire. The report's employment forecasts, on page 52, show that whereas in Cumnock and Doon Valley we had 14,500 people in employment in 1974, there is a possibility that this employment base could, at best, sink to 13,300 in 1983 and, at worst sink to 10,500 by that year.

The report is quite blunt about the reason. On page 51, paragraph 73 it says: In three districts—Cumnock & Doon, Kyle & Carrick and Renfrew—job losses are predicted at both the upper and lower limits. The Cummock situation is accounted for by the projected decline in the coal industry and the extent of the losses will very much depend upon this industry. I ask the Minister to note the words the projected decline in the coal industry. This is stated in all solemnity by the strategic planning authority. By no stretch of the imagination could be regional report be termed scaremongering or unjustified pessimism. It is a sober and sobering look at what the very near future holds unless we have major new policy initiatives to either safeguard employment in mining or replace coal jobs with work in the manufacturing sector.

Having dealt with how I believe the Government can, in the European context, safeguard jobs in the mining industry I now turn to the question of diversifying the economic base of South Ayrshire. The two priority areas at present are the Doon Valley and the Dailly-Girvan area. In the latter we are faced with an imminent closure unless the NUM and other unions fight the NCB decision, and I hope that they will.

If the unemployed people in GirvanDailly are to have any chance of alternative employment, we need the Scottish Development Agency immediately to set about constructing at least one and preferably two advance factories at Grangeston estate. This is a case deputations from the area have already argued with the Minister and I hope that he can give us a positive response tonight. I should like to place on record thanks to him for the kind and courteous reception that he gave to us last week.

In the Doon Valley we have the problem of Pennyvenie, which we all know will ultimately close. Because everyone knows that, there is every reason for planning and acting now to bring alternative manufacturing jobs into the Valley.

The Mosshill industrial estate is not going to contribute very much to the Valley's recovery. It lies at the foot of the valley and, in practice, serves Ayr and Prestwick rather than Patna, and Dalmellington where the major problems lie. I would remind everyone in the House that when Mosshill was established it was primarily intended to provide alternative jobs for the Doon Valley. But when the Boundary Commission discussed whether it should be in Kyle and Carrick or Cunnock and Doon Valley, it endorsed the Government's decision that it should be in Kyle and Carrick because it was to serve, primarily, the Ayr and Prestwick area.

There is a clamant need for action to push new industry into the Doon Valley ahead of Pennyvenie's closure. We know that ultimately the worst is going to happen and that male jobs are going to be lost. There can, therefore, be no excuse for waiting until the fateful day arrives before moving to solve the problem. If the Government act now, ahead of time, we shall be dealing with the problems of transition and not the problems of closure and collapse of the local economy.

I should like to put to the Minister a scheme that has already been put to the SDA and rejected but that is worth putting again. It is for the SDA to make the Doon Valley a special project in industrial and environmental rehabilitation. I want the Agency to undertake, along with the local authorities, schemes to upgrade the environment and clear away our inheritance of industrial dereliction. Such schemes would make the area more attractive to live in, thus helping to retain population, and more attractive to incoming industrialists, thus making it more probable that people remaining in the valley would get work. I want the SDA to establish industrial estates and advance factories in both Patna and Dalmellington and for the Agency, as part of its special project function, to set up a team whose remit is to attract manufacturing investment to create new jobs for men.

The attack on the employment problems of the Doon Valley has to be comprehensive and backed by adequate resources. The SDA is just the agency to put together a comprehensive plan of recovery and carry it out. There should be no question about scarcity of resources following the statement Mr. Lewis Robertson the Agency's Chief Executive made to the Sunday Times Business News on 30th January. There he is quoted as saying he can, at the snap of his fingers get an additional £100 million for investment in the Scottish economy.

We should like him to snap his fingers and for the Government to respond. We should like a slice of that money to be used to regenerate the economy of the valley and give us a better future than we have had a past.

The Minister will be aware that too often people simply state the nature of a problem and demand that the Government "do something," while never specifying what that "something" should be. That is not the case this evening. The nature of the problem has been fairly laid out, and a set of firm proposals have been put. All of these proposals are practical, sensible solutions. What we in South Ayrshire want is the Government's acceptance of them, and Government action to put them into practice.

11.25 p.m.

Mr. Robin Maxwell-Hyslop (Tiverton)

So as not to deprive the Minister of time to make his reply, I shall write to him with specific suggestions. The Minister was a valuable colleague on the Trade and Industry Sub-Committee in its investigation of development area policy and I know that he will concentrate his mind on these problems.

In my constituency we have to pay a heavy premium on coal deliveries. I should be pleased if Scottish ports, such as Irvine, were developed so that coal could be sent by sea to other parts of the United Kingdom which have good ports. We in Devon could then import coal at a reasonable price rather than having it sent from the Continent.

Mr. George Younger (Ayr)

Ayr has very good facilities for doing just what my hon. Friend has suggested and has had a very lucrative trade in shipping coal for many years.

Mr. Maxwell-Hyslop

If the NCB could organise prices on a system other than how many miles it is to the delivery point and start to deliver cheaply by sea at a price competitive with that of European countries, we in Devon, who do not consider ourselves to be living in a different country from the Scots, would prefer to import coal from Scotland rather than from Luxembourg, France, Germany, or anywhere else outside the United Kingdom.

11.27 p.m.

Mr. Dennis Canavan (West Stirlingshire)

The problem of the decline in the coal mining industry in Scotland is not confined to South Ayrshire. It was publicly announced earlier today that the NCB is proposing to close the Polmaise colliery in Fallin. It is the only colliery left in my constituency and it employs 620 men. Its closure will have a devastating effect in my constituency and surrounding areas.

This is being done despite the fact that, according to accurate estimates that I have obtained from a reliable source, there are enough coal reserves to employ men in the colliery for 15 to 20 years. The NCB's argument is that it would be uneconomic to keep the pit open as it is not a viable proposition but I wonder whether this is merely a temporary technical difficulty due partly to lack of investment.

The lack of communication between the Board and myself has been an absolute disgrace. I found out about the proposed closure only by coincidence. My wife went shopping in Stirling yesterday and was told of the rumoured closure by Mr. McMeel the NUM delegate from the pit in Fallin. She immediately rang me at the House of Commons and I phoned Mr. Cowan, the Scottish director of the NCB in Edinburgh, who confirmed that it was a firm proposal to close the pit. I expressed my anger at the fact that, as the Member for West Stirlingshire, I had not been consulted or informed in advance of the whole business. I got the usual stuff about negotiations being in progress.

The reason for bringing the coal industry into public ownership was to make it accountable to the people through trade Unions and Parliament. I am meeting NUM and other trade union delegates on Saturday morning about the Board's proposals and I shall explore every avenue to see whether the pit can continue, not just for the sake of the workers and their families in my constituency, but for the sake of the nation's energy needs.

Why on earth do we take industries into public ownership unless it is to make them accountable to the people through Parliament? This whole business has been a national disgrace and this is neither the first nor the last time that I shall raise this matter on the Floor of the House on behalf of my constituents and the whole community as far as energy policy is oncerned.

11.30 p.m.

The Minister of State, Scottish Office (Mr. Gregor MacKenzie)

My hon. Friend the Member for South Ayrshire (Mr. Sillars) has demonstrated to all of us the genuine concern which is felt about the situation in South Ayrshire. That concern has been echoed by other hon. Members too, and we are grateful to my hon. Friend for this opportunity to discuss these matters. My hon. Friend has expressed his concern to me not just since I joined the Scottish Office but also when I was in the Department of Industry, and I know that his concern is shared not only by my right hon. Friend the Secretary of State but by the Under-Secretary of State for Energy, my hon. Friend the Member for Midlothian (Mr. Eadie), who has come to listen to the comments of all hon. Members present this evening. I am indebted to him for having come here with me to hear the debate.

As my hon. Friend said, in South Ayrshire mining was the main industry. I understand his concern, and I share it, representing, as I do, a Lanarkshire constituency, where, when I became a Member of Parliament, we had numerous pits and now, in my own area, we have none. But I think that my hon. Friend will appreciate that the problem is that we cannot mine coal when the coal is no longer there to be mined. That is just one of the facts of life which all of us have had to recognise.

We have already seen the closure of several pits in South Ayrshire, including Minnivey and Cairnhill, which employed a considerable number of people. It is particularly unfortunate that these closures have occurred at a time when unemployment is far too high generally and when there is a shortage of new industrial investment. The surest hope for improved employment in South Ayrshire and throughout the whole of Scotland. I believe, lies in the improvement of the industrial and economic prospects for Scotland and the United Kingdom as a whole.

We in the Government are certainly determined to bring down the level of unemployment as quickly as possible, but we suffer from a trade deficit and a high rate of inflation, and if we are to have a sound base for a genuine economic improvement and secure jobs, these things must be given priority in our considerations.

To that extent, the keystone of the Government's economic strategy has been to channel more resources into productive manufacturing industry. This is essential, and our industrial strategy is particularly designed to ensure that Britain's industry, including Scotland's industry, is on the path to recovery. We have put a great deal of effort into this task in recent times. We have already announced an increase in the resources of the National Enterprise Board and the Scottish and Welsh Development Agencies. There is also an initial allocation of about £100 million for the new selective investment scheme. That is in addition to about £200 million which we have set aside to stimulate investment in certain key industries.

In the meantime, we have, I believe, done as much as we possibly can to alleviate unemployment. The temporary employment subsidy, the recruitment subsidy for school leavers and the youth employment subsidy have already made a significant impact in Scotland. Those measures have already saved or created about 1,400 jobs in the employment area referred to by my hon. Friend, in Ayr, Cumnock and Girvan. In addition, the job creation scheme has created about 1,300 jobs in Ayrshire.

The hon. Member for Tiverton (Mr. Maxwell-Hyslop) mentioned coal exports from Scotland, and I appreciate the way in which he and my hon. Friend the Member for West Stirlingshire put their views. Those hon. Members will forgive me if I do not reply to them in detail. In fairness I ought to deal with the matter raised by the hon. Member for South Ayrshire, for it is his Adjournment debate. My hon. Friend the Under-Secretary of State for Energy has listened to the whole debate and he will have noted the points that they have made about the situation in West Stirlingshire, and no doubt he will deal with them later.

Reference has been made to the Dalquharran Colliery in Ayrshire. My hon. Friend mentioned to me several years ago the limited life that the colliery was likely to have. It certainly appears that there are difficulties here about which we should be concerned. I am sure that it will be appreciated that this is a matter that we have to discuss with the unions in the areas primarily concerned.

The hon. Member mentioned the current negotiations between the South of Scotland Electricity Board and the National Coal Board about Scottish coal burn. This is a matter to which my hon. Friend the Under-Secretary of State for Energy and I attach considerable importance, but I cannot add anything to the statement, which my hon. Friend made yesterday and which no doubt the hon. Member for South Ayrshire will have seen in the Scottish Press, that the two organisations concerned are dealing with this matter as quickly as possible.

We have a dual interest. We want to ensure future employment for miners and we want to protect the consumers of electricity and so on. We want to ensure that this is done properly, and it is right and proper that these negotiations should take place. We hope to be able to bring them to a conclusion very soon.

There was a reference to the Scottish Development Agency. Although I might not have used the expression of the Chief Executive of the Scottish Development Agency, that he had only to snap his fingers—in fairness I should say that he was rather misquoted—he knows that the Government have listened with considerable sympathy to any application. The Chancellor of the Exchequer in his recent announcement indicated the extent to which we were prepared to give further assistance to the SDA for industrial and environmental projects. This will be of particular interest to my hon. Friend, who has been in communication with the SDA, which will certainly be well briefed about the industrial problems in his constituency by my hon. Friend's Department.

The SDA has a dual role. It has the role of factory building, which it is taking very seriously, and it has the environmental role, and it is prepared to help in any way it can. The SDA is concerned about the advance factory in the Grangeston industrial estate, but this is a matter of everyday management. However, I know the situation and my hon. Friend can be assured that—

The Question having been proposed after Ten o'clock and the debate having continued for half an hour Mr, DEPUTY SPEAKER adjourned the House without Question put, pursuant to the Standing Order.

Adjourned at twenty-two minutes to Twelve o'clock.