§ 11.44 p.m.
§ The Under-Secretary of State for Energy (Mr. Alex Eadie)
I beg to move,That the draft Redundant Mineworkers and Concessionary Coal (Payments Schemes) (Amendment) Order 1979, which was laid before this House on 7 March, be approved.With your permission, Mr. Deputy Speaker, and that of the House, it might be convenient to discuss at the same time the other motion on the Order Paper:That the draft Mineworkers' Pension Scheme (Limit on Contributions) Order 1979, which was laid before this House on 7 March, be approved.
Mr. Deputy Speaker (Mr. Bryant Godman Irvine)
I understand that it will meet the convenience of the House if the two orders are taken together.
§ Mr. Eadie
Perhaps I may deal first with the pension scheme order. In April 1975 the mineworkers' pension scheme was revised and became an earnings-related self-financing scheme covering men employed in the industry at that date, and also future employees. Just prior to that, in the final report of the tripartite coal industry examination in 1974, the Government recognised that the past contraction of the coal industry presented a financial problem for a viable pension scheme because of the exceptional ratio of pensioners to contributory members—about one to one instead of one to five.
In particular, there was a considerable deficiency in the pension fund in respect of men who had retired before April 1975. There were some 240,000 of these and, in addition, about 180,000 deferred pensioners who had left the industry but could claim their pensions when they reached the age of 65. Because it would have been unfair to place this "burden of the past" on the industry, the Government agreed to contribute towards the deficiency attributable to these men and, in the National Coal Board (Finance) Act 1976, Parliament authorised a contribution of up to £18 million a year for 20 years.
The Act also included provisions for increasing this annual payment where the deficiency had increased because of the need to keep the pensions of these men in line with the rise in the cost of living.
203 In 1975 these pre-April 1975 pensioners received a flat-rate pension of £3.60 per week. This was increased in 1975 to £4.60 and again in 1976 to £5.23 in line with the rise in the cost of living. These increases enlarged the deficiency in the pension fund, and to meet this the House approved the Mineworkers Pension Scheme (Limit on Contributions) Order 1977, which increased the limit on annual contributions from £18 million to £28.2 million.
In 1977 the pensions were again increased to £6.16 per week, and a year ago the House approved an order increasing the limit on the annual contribution to £34 million.
Last October the pensions were once more increased—to £6.62 in line with the rise of 7.4 per cent. in the retail price index. We are advised by the Government Actuary that the consequent increase in the deficiency is equivalent to an annual payment of £2.7 million for the remaining 17 years of the original 20-year period. However, it has been necessary to make an adjustment of £220,000 to correct a small overestimation in assessing last year's increased contribution, so this year's increase becomes £2.48 million.
The Government, therefore, are now seeking the agreement of the House for the limit on the annual contribution to be increased by the amount of £2.48 million to £36.48 million. The first payment to the National Coal Board needs to be made before the end of the current financial year, and similar amounts will be paid in future up to and including 1994–95.
I must emphasise that the increase that we are discussing relates solely to men who were pensioners before April 1975 or had already, at that date, qualified for a deferred pension. We are not concerned with men who become pensioners after that date. The relevant order is the draft Mineworkers Pension Scheme (Limit on Contributions) Order 1979 and it will be made under section 2 (4) of the National Coal Board (Finance) Act 1976.
That Act also requires the Secretary of State to lay a statement explaining the considerations which have led him to conclude that the order should be made, and the House will have noted that such a statement was laid with the order.
204 As far as the current position of the National Coal Board is concerned, although the audited accounts will not be available until the summer, we have obtained estimates from the Board of the likely outcome of its operations in the present financial year. These estimates show that after taking credit for all Government grants agreed to date, except the £2.48 million increase which will be permitted by this draft order, the Board expects to suffer a deficit in 1978–79 which is shown in the statement as "about £65 million" but which I am informed by the Board now seems likely to be nearer £50 million.
Against this background, my right hon. Friend has decided that it is appropriate that the order should be made.
§ Mr. Robin Hodgson (Walsall, North)
Can the Minister say how many pensioners there are remaining—first, how many current pensioners and, secondly, how many deferred pensioners? The hon. Gentleman also referred to a current estimate of a £50 million deficit. What was the equivalent last year?
§ Mr. Eadie
I gave the relevant figures of pensioners earlier in my speech. As for the hon. Gentleman's other question relating to finance, I shall give that information if I succeed in catching your eye again, Mr. Deputy Speaker, before the end of the debate.
I come now to the Redundant Mineworkers and Concessionary Coal (Payments Schemes) (Amendment) Order. The redundant mineworkers payments scheme was first established in 1968, but the current scheme was made under section 7 of the Coal Industry Act 1977. Broadly, it pays a miner redundant at age 55 or over 95 per cent. of his previous net pay—that is, after income tax, and so on—for three years. After these three years of full benefit, the man receives from the scheme a weekly sum equivalent to the current rate of unemployment benefit until he reaches age 65 and in addition his mineworker's pension paid prematurely. He also receives concessionary coal. Men redundant between age 35 and age 55 receive lump sums based on their length of service.
The purpose of the order before the House is to amend the current scheme in three main ways. First, it provides a new table of benefit which takes account 205 of changes in taxation and the increase in unemployment benefit which was effective from last November. Secondly, we are taking the opportunity to raise the earnings limit in the table of benefit. The existing table imposes a limit of £80 per week on the pre-redundancy earnings which can be taken into account when calculating benefit. This limit has now been increased to £110, which is a more realistic level, and indeed—although there is no direct connection—it is the same as the earnings limit under the Employment Protection (Consolidation) Act 1978.
Thirdly, while certain State benefits are offset against scheme benefits, this is subject to a minimum, which is kept in line with the minimum rate of pension. As this has just been raised from £6.16 to £6.62, the third amendment which we wish to make is to raise the minimum benefit payable from £6.16 to £6.62 per week.
The other amendments do no more than update the references in the order to other legislation.
The Government therefore seek the approval of the House to the Redundant Mineworkers and Concessionary Coal (Payments Schemes) (Amendment) Order 1979 which makes these changes.
§ 11.54 p.m.
§ Mr. Jim Lester (Beeston)
I declare an interest as a non-paid, non-executive director of a family company that supplies the National Coal Board with safety equipment. The last time I had the opportunity of speaking from this Dispatch Box, again with the Under-Secretary opposite me, was at three o'clock in the morning. At 11.54 p.m., one is at least moving in the right direction.
I am pleased to say that neither order is a matter of contention. We thank the Minister for his careful explanation. One scheme was established in 1973 and has since been revised, as he has described. The second scheme was in the Coal Act 1976. We have always supported the scheme in principle each time it has come before the House. The debate shows the impact of inflation. The cost of the scheme is more than double the amount at its introduction only three years ago. Its cost has increased by £2.48 million since last year. Will the Minister say whether this increase is simply a matter of inflation or whether there is a wider explanation?
206 The second significant point, dealt with to some extent in the last debate, is the uncertain world in which we live when debating energy matters. The right hon. Member for Huyton (Sir H. Wilson) coined the phrase "a week in politics is a long time". This week, three days, or possibly even two days, is a long time. Thinking of the need to maintain stable policies, when the module in energy for a new pit, power station or development of technology is about 10 years, the security of supply of home-produced energy takes on an extra dimension. That is apposite, in view of the Iranian situation, mentioned in an earlier debate, and today's OPEC meeting.
In spite of increased productivity, the worsening figures of the NCB also have to be considered. Another matter causing concern is the higher stocks at the pithead and the power stations. To keep coal as one of the four-fuels policy, which forms the cornerstone of our industrial revival and enables successive generations to maintain flexible energy supplies, the industry must be provided with a range of options to deal with the human problem of closure of worked-out, dangerous or permanently unprofitable pits. Unlike some hon. Members, we do not see this as necessarily running down the industry but more as a reshaping of the industry to ensure a competitive future. I would not presume to speak as authoritatively as many hon. Members with their direct experience.
On the Conservative Benches we accept that the closure of a pit can be very different from the closure of a factory Neither is ever welcome. In remoter parts of the country, the coal industry has been almost the sole employer. It is interwoven into the life of the community. Two or three generations of families have been familiar with pit society. There is an established structure within the community, often based on the pit—the characters of the village, the NUM officials, the way of life and the shared experiences. Many of those experiences are happy, but, as we are reminded on reading today of another death in the recent disaster, many are sad.
We accept the need for a policy for closures. We recognise that a second or third move for many people in my constituency, even if they continue to live in 207 the same place, means a new start. To start again is not always easy. It is, however, inevitable in an extractive industry that there will be closures.
We notice with regret that Teversall, in the constituency of my hon. Friend the Member for Ashfield (Mr. Smith), is to close and that other pits in other parts of the country are being examined. We believe that each closure should be examined on its merits and all the effects carefully considered. It is not difficult for a young man to move into an increasingly modern industry, but it is right that a man aged 55 or over should be able to choose whether he wishes to continue. This does not underestimate the impact on his life.
We know from the previous debate and from past energy debates that there is a thread of agreement on the immediate future which could depend on establishing wider markets. In the previous debate, hon. Members discussed an extra way of getting a coal-burn in Europe. We have repeatedly said that we extract the most coal and the cheapest coal in Europe. We believe that with proper representation a European coal-burn could be achieved.
Secondly, we see the future in a new generation of technology which uses more intelligently the valuable hydrocarbons beyond the present method of simple coal-burn in power stations. These have been mentioned many times—liquefaction, synthetic natural gas, extra domestic choice, given chimneys and highly efficient burners and fireplaces, and particularly the industrial alternative, with modern burners and gas conversion.
But the introduction of these is some years ahead and its pace depends on the industry's short-term ability to retain confidence, investment and its competitive position, which are linked to better and safer methods of extraction and to the opening of new mines such as Betws, Selby and Kingsley.
But the third factor, which must be always in our minds, must be better consideration of the men on whom the future of this industry depends. The NCB report and accounts for 1977–78 show that, out of a total value added in that year of £1,667 million, no less than 84 per cent. was paid to employees. That reminds 208 me of the saying in the pubs around Eastwood, "In this life, coal is free; it's the getting it that's the problem."
I hope that the Minister will give us figures for the expected redundancies to 1981 and the estimated coal based on past experience. Perhaps, on the brighter side, he might also be able to give us the average age in the industry now and the figures for recruitment of the next generation for miners. Thirdly, has he or his Department considered any other options that could be helpful over closures? I am thinking, for instance, of terminal lump sum payments. When one considers the order in detail and the complications of the present system, one wonders whether some might prefer a single payment as an alternative, based on the costs of the present scheme. That suggestion is made in good faith, because we realise that fir future of the industry depends on investment not only in technology for consumption and extraction but in a fairly-treated work force.
§ 12.3 a.m.
§ Mr. Dennis Skinner (Bolsover)
I notice that the debate has widened slightly as a result of the speech of the hon. Member for Beeston (Mr. Lester) and that of the Minister. Perhaps the most important thing when we are talking about redundancy schemes, concessionary coal schemes, pensions, and so on, is to try to avert many of these payments in future. The hon. Member for Beeston wanted figures for prospective pit closures in 1981. I am not searching for that information; I want the Minister to make it clear that he will resist any closures and that he will tell the National Coal Board that what we need now, in the new situation developing over oil, is to keep open as many pits as possible, except where the coal has absolutely run out.
I want to emphasise those words. The NCB is capable of suggesting that coal has run out when it has not. There are variations on the question whether it has or not. Teversall was a good example. The men in Nottinghamshire, particularly in Teversall, were saying that there was a good deal of coal still left in that pit, yet the NCB was insisting that it was not workable.
Therefore, we must ensure that up to 1981 and well beyond as much coal as 209 possible is obtained from some of these so-called uneconomic pits to which the NCB constantly refers.
We are getting back to the situation that applied in the 1950s and 1960s, when the oil companies were intruding on the traditional coal markets and pits were consequently being closed at a tremendous rate.
I can foresee the situation in which unwise heads may decide that it is not a bad idea to have another bout of pit closures. People might think that they will get sufficient coal from the Vale of Belvoir or Selby, and so on. Naturally I want coal to be produced effectively and efficiently in such places, but I am more concerned that the pits in Nottinghamshire and Derbyshire—Scotland and South Wales also spring immediately to mind—are kept open for as long as possible. More attention should be paid to the union's demands and less to what the National Coal Board says on these matters.
With the new Iranian crisis in oil supplies, we are running into another dangerous period. If some pits are running at less than the economic rate, so be it. We have only to hark back to the period in the 1960s, when the pits were being shut by the Coal Board with, sadly, successive Governments turning a blind eye to the closures, to realise that the result was that there were hardly any coal stocks on the ground. If anything caused the 1972 miners' strike, it was that the miners suddenly realised that they were in a tremendously powerful bargaining position. I worked for 21 years underground and we were never in such a strong position. We realised the strength of our position long before the oil crisis. It arose between 1970 and 1972 because the Coal Board unwisely shut too many pits.
The emphasis should be on keeping open for as long as possible all those pits where there are reserves and where it is possible to operate them. More attention should be paid to the NUM's assessment of the reserves than to the suggestions by the Coal Board. I know that the Board wants to seek efficiency where it can find it. But if pits are shut more payments have to be made to miners.
I do not take kindly to having to pass orders such as these in order that payments may be made. I would much prefer 210 to have a coal mining industry employing about 400,000 miners. Even though on that basis the output per manshift might not be as great as it is now, at least we would know that in this labour-intensive industry we were providing work for more people.
That brings me to the important point partly touched on by the hon. Member for Beeston when he spoke of the shutting of pits. Most of the men are employed underground. In some terms it is relatively easy to employ 700 or 800 men in a hole in the ground. But if the pit shuts—perhaps in Derbyshire or Nottinghamshire—it is a hell of a job to find that many jobs in factories on the pit top.
We have seen many examples of where marshmallow factories, and so on, have been erected. Courtaulds and Dunlop have put up factories in the North-East and in Lancashire, picking up the grants—more public expenditure—and when it suits their convenience they leave. That means that the ex-miners who went into the factories and learned to do the work are once again on the scrap heap. A lot more attention must be paid to keeping pits open for as long as possible.
There has been reference to the number of fatalities in the industry. I simply advise hon. Members not to get too hung up on the idea of the productivity scheme. I put on the record again that, irrespective of how the individual or collective accidents occur, there were 63 fatalities in 1978 as against 40 in 1977, the former being the first full year of the productivity scheme. That must be borne in mind, too.
Demand is the most important single question. I do not share the Opposition view that we are not selling coal in the Common Market because of the activities of my right hon. Friend the Secretary of State or any of the Ministers concerned with the Department of Energy. Many long-term contracts were made in the Common Market years ago, involving markets in the East and the West. Although this country is taking EEC butter and is storing and caring for much of the produce of the Common Market and having to buy EEC goods, there is no quid pro quo on the other side.
A lot more attention has to be paid to finding more demand for our coal. It means that the Department of the 211 Environment must instruct local authorities to ensure that houses are built with chimneys. In Sheffield, the local council has been talking about switching from oil back to coal; it should never have switched to oil in the first place. The same is true of countless local authorities throughout the country. I should like to see a directive from the Department of Energy to all the various areas where demand can be created in order to mop up some of the 29 million tons of coal currently at the pit top. It means that we have to take up the 5½ million extra tons of coalburn in this country, and more besides.
The emphasis must lie in ensuring that we are safeguarded through this period of oil crisis. Notwithstanding North Sea oil and gas, the fact is that the coal is there to be got. We also know that when a pit is closed the chances of its being reopened are slight, although I am told that there is a possiblity at Thorne, and things are looking up there. But that is a startling example that runs against the usual grain. Few pits are reopened once they have been closed, and in any case Thorne was shut for special reasons.
The emphasis must be on keeping the pits open and ensuring that a massive attack is made on all the various markets where we can create demand. When that is done, we shall not be coming here to pass orders for extra amounts of money on the basis of throwing more and more people out of work; instead, we shall be passing orders for extra amounts of money in the context of wage rises in order to ensure that pit wages equate with current wage rates. The emphasis for successive Governments, of whatever colour, is to ensure that the mining industry is not only stabilised at its current state in terms of manpower and pits but is expanded massively over the next few years.
I want to make one specific point about concessionary coal. I have long argued in this House and before I came here that some miners who worked in the pits for 40 and more years never got any concessionary coal because they did not come into the category prior to the first order being brought in in 1967–68. I can give examples of the Blackwell pit and various others shut at the south end of Derbyshire, and I suppose there are others in Lancashire, Durham and elsewhere.
212 It is high time that the Department and the NCB got together to provide a scheme to pick up all these cases. Many of these miners or their widows have passed on now, but thousands like them are left and are somewhat aggrieved because they have not had many of the benefits which have been given since 1967 in many directions. They are not able to get even three or perhaps four or five tons of coal a year to heat their homes. These cases ought to be picked up by the Minister, and I hope that he will pay some attention to this matter when we form the next Government.
§ Mr. Tim Smith (Ashfield)
I have considerable sympathy with what the hon. Member for Bolsover (Mr. Skinner) has said about the effect of redundancies and the need to ensure that they are minimised in the coal industry. He mentioned the proposed closure of Teversall colliery, in the Ashfield district. I know that that was regarded in many ways as a test case. One has to accept that eventually pits have to close either because of exhaustion or because they are grossly uneconomic.
I am not saying that Teversall is grossly uneconomic, because I do not consider that I am qualified to give a view one way or the other—that is a matter between the National Union of Mineworkers and the National Coal Board. But the fortunate and welcome aspect is that no miners will be made redundant in 1980 or 1981, when the pit is closed. That situation was reflected in the fact that even some of the miners who work in the pit voted against taking industrial action to oppose the closure; indeed, a very large majority of miners throughout the area opposed industrial action.
We have to balance the need to preserve existing employment and the need to ensure that resources are not wasted on uneconomic pits, when those resources can be better invested in new pits which would be far more profitable and, in the end, provide many more jobs. I think that is understood and that it will be possible to run down those pits which are uneconomic in such a way as not to make people redundant. Early retirement, and ordinary retirement, will be able to cope with most of the lost jobs, or alternative employment can be offered at other pits.
213 When the Select Committee on Nationalised Industries discussed this question, the chairman of the Coal Board explained how the coal industry was changing and how it was expected to change in the next few years. He said:We are in the process of very vigorous change; we are moving into an entirely new industry. By the end of this century, if our investment plans are fully realised, two thirds of the whole of our capacity will have been introduced in the past 25 years; so that we will be two thirds on entirely new industry".We must recognise that that is the long-term aim of the Coal Board, and is something which has been agreed between the Board, the unions and the Government, in the "Plan for Coal". We have to reconcile that with the need, on the other hand, to ensure that redundancies are minimised. We know that there will have to be redundancies, and that is the reason for the discussion of this order tonight.
I ask the Under-Secretary of State what the cost of this order is likely to be. I appreciate that it may not be possible to forecast it totally accurately, but I think that when the Government are putting forward proposals for additional public expenditure of this kind we should have an indication of the likely cost. As it covers prospective redundancies until 1981 I appreciate that it may not be possible to quantify it accurately, but an indication of the cost would be helpful.
While the long-term prospect for the industry is encouraging, we know from recent debates on this subject that the short term is less encouraging. That brings me on to the second order that we are discussing, which is the pensions order. The Act requires the Government to supply this finance only if the Coal Board is unable to supply it. It is clear to anybody who looks at the current financial position of the Board that there is no question of its being able to finance this £36.48 million itself. Therefore, we support the order.
The question that I wanted to put to the Under-Secretary earlier on the number of pensioners was not how many pensioners was originally envisaged. He told us last year in Committee that there were 240,000 current and 180,000 deferred pensioners. He told me in a letter last year that the number remaining was 233,000 current pensioners and 150,000 deferred pensioners. That was the number that 214 the Government anticipated by September 1978.
I asked this question because there are three factors which the Government must take into account in determining the amount of money. One is that there is one less year to go—17 years now, 18 years in 1978. Another reason is that the payments under the order have been increased in relation to the increase in the retail price index. The third reason is that there are fewer pensioners than at this time last year. I asked that question so that we would have an overall picture of how the figure had been arrived at.
We have the statement supplied with the order. The Secretary of State tells us that the Coal Board is not in a position to provide the finance. This was borne out when the chairman of the Board was questioned specifically on this matter by the Select Committee. It asked the chairman, since this £34 million is now increased to £36 million—one of the largest revenue subsidies provided by the Government to the Board—how far this was going to be a continuing substantial amount and how far the situation reflected problems with the pension fund historically.
The point was made that the order deals only with pre-1975 pensioners, and, for reasons that the Under-Secretary explained, there are historical differences in the pension fund. Nevertheless, there is what might be termed an "ongoing situation". The question is whether the Government will be asked indefinitely, from year to year, to provide this finance or whether, eventually, the Board will be able to finance the expenditure itself. I hope that despite the current capital investment programme undertaken by the Board there will be a limit to the revenue subsidy to be offered by the Government and that eventually the Board will be able to pay for this itself.
The long-term prospects are more encouraging. We have already discussed the effects of the Iranian situation on oil prices, and perhaps this will enable the Coal Board to increase the price of coal at an earlier stage than it might otherwise have anticipated.
Perhaps there will be a price opportunity and an opportunity for the Board to meet its target. The target that the 215 Board set itself was that it should break even on a historic cost basis after depreciation interest and that it should provide itself with 50 per cent. of the necessary investment. The current position of the Board was well illustrated by my hon. Friend the Member for Beeston (Mr. Lester), who said that if we examine the Board's accounts for last year and the value-added statement, which the Board introduced into its accounts for the first time, we can see that of the total value added through the internal efforts of all those employed by the Board, 84 per cent. was paid out in wages and only 7.6 per cent. was invested in the industry. The balance must be changed.
That does not mean that there must be a reduction in wages. It means that there must be an increase in efficiency so that it is possible to pay more wages—part of which will be paid through increased payment under the incentive scheme—and to contribute a larger proportion which the Board hopes to make towards investment.
I hope that the Board will then be in a position to make some of the revenue subsidies itself. It is unreasonable to set targets for nationalised industries because they set similar targets for the return on capital. But it is reasonable for the Board to argue that it has inherited social problems and that it expects the Government to pay for them. We should not go beyond that.
I turn to the financial relationship of the Board with the EEC. We have heard much criticism recently of the EEC. We have been a member of the European Coal and Steel Community since we joined the Community. The NCB has benefited in many ways from that. There have been direct financial benefits. The Board pays £6.4 million in levies. It receives £6.7 million in grants.
As the largest coal-producing member of the Community, we have taken the lead in seeking to formulate and influence coal policy. There is now general agreement about that policy. In the technical exchange arrangements with the German mining industry and others, we have gone way beyond the point that we reached before. Many people in the industry have benefited.
For those reasons the British coal industry has benefited. The NCB is limited 216 in the way in which is can borrow money. It has to go to the national loans fund. It cannot go to the open market. It has to pay higher interest rates. Another avenue of loan finance has been provided through the Community at advantageous rates.
For those reasons I support the orders.
§ Mr. Eric Ogden (Liverpool, West Derby)
I know that I must talk about the order, the whole order and nothing but the order, despite the more wide-ranging debate that we had earlier. I make no complaint about that.
I declare an interest with my hon. Friends the Members for Bolsover (Mr. Skinner), for Morpeth (Mr. Grant) and the Under-Secretary of State. I do not qualify for concessionary coal. One of the things that we miss most about our previous employment is concessionary coal, even if one had to shovel it from the doorstep into the cellar. That is one perk that I miss. I do not think that I qualify under the pension scheme, although I might be entitled to £1.20, which will not go far.
We are agreed that the measures are welcome. There is agreement on both sides of the House—more keenly felt on the Labour side—that redundancies have to be kept to a minimum and that the Government are rightly bringing earlier orders up to date with the levels of inflation and so on.
I make only one point of criticism in respect of the reasonable and responsible speech of the hon. Member for Beeston (Mr. Lester). In part of his wider-ranging remarks he mentioned the high level of stocks. I think he would agree that had we not had high levels of stocks over these past three months, especially high levels of stocks at the power stations, with the kind of weather and transport difficulties we have experienced, this hard winter would have been even harder.
High levels of stocks are good insurance policies. Of course, they should not be too high, but stocks at power stations are something that we should have. I shall not go into wages arguments or how they are used, but the simple fact is that had we not had good levels of stocks at power stations, to be called upon, our difficulties would have been much greater. I hope 217 that the hon. Member for Beeston is not concentrating his mind on reducing stocks either at power stations or anywhere else. In fact, we should be compensating both the CEGB and the NCB for stocking coal. That is a good cautionary reserve policy.
With those two brief remarks, which I hope will commend themselves to the Chair and the House, I welcome the orders.
§ 12.27 a.m.
§ Mr. A. J. Beith (Berwick-upon-Tweed)
This debate has ranged widely over ways in which redundancy has arisen in the coal industry and the means we might take to prevent it. I agree with much of what has been said. On that issue, I merely take up one point made by the hon. Member for Bolsover (Mr. Skinner) about the need to have chimneys in council houses and make it possible for people to use solid fuel.
It is not that I think we should try to force a particular fuel on tenants of council houses. Rather, I believe that we should give them a choice. Many people in my constituency would dearly love to be able to burn solid fuel and keep their houses warm, instead of being bankrupted by higher electricity prices, but they are unable to do so because the local authority has not provided chimneys and there is no prospect of adapting.
I tabled a question on this subject to the Department of the Environment the other day and I saw the answer today. The Department refuses to accept that the housing cost yardstick is acting as a disincentive to local authorities to install chimneys in houses. I believe that it is, and so do the local authorities. I think that some positive action of the kind recommended by the hon. Member for Bolsover is necesary. I see it as a means of giving tenants a choice of fuel, so that they can use electricity, gas or coal. I believe that in many cases they would make the choice for coal, and they should be given the opportunity to do so.
§ Mr. Ogden
I do not want to introduce a note of discord, but Liverpool Labour Members have been urging that point on those who presently control Liverpool city council. The hon. Gentlemen's own colleagues, including the Liberal candidate in Edge Hill, who is the housing 218 chairman, is saying exactly the opposite to what he is saying.
§ Mr. Beith
I remind the hon. Gentleman that Liverpool is just as much subject to the housing cost yardstick as is any other local authority. If he likes to produce plans for houses that enable authorities to make decent provision, and which include the choice of fuel element, he would be a welcome visitor to any housing department in any local authority in the country, but the advice that I get from local authorities throughout the country, especially in my own constituency. is that they cannot do this without imposing other severe restrictions on the quality of homes they provide. That is bad enough as it is, in terms of insulation and all the things that make heating problems so great.
I come back to the issues raised in the orders. One of the lessons of the Redundant Mineworkers and Concessionary Coal (Payments Schemes) (Amendment) Order is something that I hope the Department will pass on to the early retirement scheme. There is at present an important and worrying difference between the two schemes. The Minister pointed out that the payments made under this scheme are equivalent to social security and unemployment benefits. That, after all, is why the scheme has to be uprated. But the man who takes part in the early retirement scheme at 62, 63 or 64, who is contributing just as much to the short-term manpower changes that the Coal Board is bringing about, must go and sign on for unemployment benefit, often to pay his bus fare in order to do so.
The hon. Member for Morpeth (Mr. Grant) will know as well as I do the sort of distance and costs that are involved. The man will be expected to say that he is available for work in jobs that do not exist or, if they did, he could not do. After a lifetime in mining, he is not fit to take on many jobs because of his health. The benefits of the scheme should be carried over into the early retirement scheme. That scheme is unfortunate in depending so heavily on unemployment benefit. A man has to sign on with people who are genuinely unemployed, when he has been told, in effect, that it is time for him to retire and join those who under this scheme have left the industry. I hope that something will be done about that.
219 Secondly, this is the concessionary coal scheme. The National Union of Mineworkers plays an important part in administering it and is the first to point out what difficulties arise through the closure of pits. These closures mean that there are fewer working miners to contribute to the pool through which coal is made available to widows and retired miners. The hon. Member for Bolsover mentioned that some widows are not eligible for concessionary coal.
Another group of widows is also affected. In the area that I represent, any widow who has worked since her husband's death for only a few days or weeks is permanently disqualified from receiving concessionary coal. The National Union of Mineworkers has tried to bring them into the scheme, but it is felt necessary to apply the rigid rule because of increasing difficulties of running a coal pool with the decreasing number of men contributing. It is a serious matter when a widow who is entitled to concessionary coal loses it because even for a few weeks she has taken, for instance, a cleaning job. I hope that in these discussions the Under-Secretary will also consider that problem.
§ 12.34 a.m.
§ Mr. Eadie
I believe that this is the first time that the hon. Member for Beeston (Mr. Lester) has spoken from the Front Bench, although he said it was the second, and I congratulate him. I am sure that the House has enjoyed listening to the constructive way in which he has presented the problems and approached the debate.
The hon. Member for Ashfield (Mr. Smith) asked about the Coal Board deficit of £50 million. The position at the same time last year showed a surplus of about £10 million to £15 million. The hon Member also asked about pre-1975 pensioners. In 1975 there were 240,000, together with 180,000 deferred pensioners.
On the annual maximum payment of £36.48 million over the next 17 years, if in future years the National Coal Board were to contribute towards that deficiency the contribution of the Government would be reduced accordingly. I cannot see that happening. There was an element of optimism in the speech of the hon. Member for Ashfield. He may find an answer if he reads his speech.
220 The hon. Member for Beeston asked about the £2.48 million increase in the order, and I can tell him that it was related to the cost of living.
I was asked about the number of redundancies estimated in 1980–81. We have no figures. The present scheme pays lump sums to men under 55 who are made redundant, but weekly payments are felt to be better for men of 55 and above. I was also asked about average ages. I suspect that the age has decreased, but I would be very disappointed if it had not. But this is a complex matter and it varies from area to area. I shall try to get the information requested as quickly as possible and give the hon. Member for Bridgwater (Mr. King) these figures.
The hon. Member for Berwick-upon-Tweed (Mr. Beith) talked about beneficiaries under the RMPS having to sign on in order to get the unemployment benefit. In the first year they must do exactly the same as early retirement men. I understand the problem that the hon. Member raised. I represent a mining constituency, and I get letters continually on this matter.
The concessionary coal agreement scheme is negotiated between the National Coal Board and the National Union of Mineworkers. If one looks at the history of the scheme, one can see that it has improved gradually with time. The great problem has been that the progress has not been retrospective enough to benefit everyone, and this has caused a great deal of distress.
The hon. Member for Beeston mentioned coal stocks, an issue that was also touched upon by other hon. Members. When we have a chance to take stock of the position the nation will be grateful that we have such good stocks of coal, considering the fact that we have had the worst winter in living memory. Also, these stocks were in the right place. Perhaps some of those who have criticised the policy of keeping large stocks may have come to the conclusion that it was right after all. There was a time when the whole electricity network was under great strain, but because we had such high coal stocks we were inconvenienced less in this severe winter.
The question of pit closures was raised. The hon. Member for Beeston gave a fairly broad and compassionate view of the problems associated with pit closures 221 —the social consequences and the distress that can be caused. My hon. Friend the Member for Bolsover (Mr. Skinner) asked about policy on pit closures. I do not tell any secrets out of school, but we have been trying as best we can on this issue. Mention has been made of the situation in Iran, and I believe that we must get right away from pit closure policy and start talking about a replacement policy. Hon. Members have been talking about vast coal reserves of 300 years or so.
I think that we are playing down our coal reserves. When technology improves, we shall have not 300 years' reserves of coal but 1,000 to 1,500 years' reserves. The long-term future, whether looked at from a domestic or European standpoint, lies in more and more investment in our mining industry.
The industry is highly technological. When I go on the coalface, I see far fewer men. The absent men are those who used to make the chocks and props on the face. Nowadays the engineering industry is largely dependent on the mining industry. Therefore, any decision to contract the mining industry would mean a contraction in the number of jobs in the engineering and service industries. This year we shall need every shovelful of coal we can obtain.
It was said in the previous debate that 80 million tonnes of coal would be required for power stations—the highest total on record. We shall have great difficulty in obtaining that amount because of the mistakes made in the 1960s. Certainly the Labour Government do not intend to pursue the policy of the 1960s, because that policy was disastrous. Our policy will mean more investment in the mining industry and certainly will not involve a policy of contraction. We look to an expansion policy. Indeed, we are the only EEC country which intends to expand its coal industry, while other countries are talking about contracting theirs.
The House acknowledges the fact that these orders must go through, and I am happy to commend them to the House.
§ Question put and agreed to.
That the draft Redundant Mineworkers and Concessionary Coal (Payments Schemes) (Amendment) Order 1979, which was laid before this House on 7th March, be approved.
That the draft Mineworkers' Pension Scheme (Limit on Contributions) Order 1979, which was laid before this House on 7th March, be approved.—[Mr. Eadie.]