Commons Sitting of 24 July 1980

Preamble
The House met at half-past Two o'clock
PRAYERS
[Mr. Speaker in the Chair]

EASTBOURNE HARBOUR BILL [Lords]
Order for Third Reading read.
To be read the Third time upon Monday 28 July.

SALVATION ARMY BILL [Lords]
Read the Third time and passed, with amendments.

GREATER MANCHESTER BILL [Lords]
Orders for Second Reading read.
To be read a Second time upon Thursday 31 July.

DUNDEE PORT AUTHORITY ORDER CONFIRMATION BILL
Read the Third time and passed.
CITY OF DUNDEE DISTRICT COUNCIL ORDER CONFIRMATION
Mr. Secretary Younger presented a Bill to confirm a Provisional Order under section 7 of the Private Legislation Procedure (Scotland) Act 1936 relating to the City of Dundee District Council: And the same was read the First time; and ordered to be considered upon Wednesday 30 July and to be printed. [Bill 257.]
INVERCLYDE DISTRICT COUNCIL ORDER CONFIRMATION
Mr. Secretary Younger presented a Bill to confirm a Provisional Order under section 7 of the Private Legislation Procedure (Scotland) Act 1936 relating to Inverclyde District Council: And the same was read the First time; and ordered to be considered upon Wednesday 30 July and to be printed. [Bill 258.]
ORAL ANSWERS TO QUESTIONS
  NATIONAL FINANCE

    North Sea Oil (Revenue)
    Mr. Dubs1. Mr. Dubs asked the Chancellor of the Exchequer what is his latest estimate of North Sea oil revenues from corporation tax, petroleum revenue tax and royalties in 1980–81.
    The Minister of State, Treasury (Mr. Peter Rees): The figures—which were published in the Treasury economic progress report for July—are £450 million, £2,560 million and £1,090 million for corporation tax, petroleum revenue tax, and royalties respectively.
    Mr. Dubs: Is the Minister aware that many experts believe that the Treasury is seriously under-estimating the likely revenue from North Sea oil over the next two or three years? That is likely to result in a lower, or possibly negative, public sector borrowing requirement. Will the Minister make clear that, if that happens, he will review the public expenditure cuts with a view to reducing them?
    Mr. Rees: The hon. Gentleman is making certain assumptions that we are not disposed to make at present. Naturally, we are concerned with the structure of petroleum revenue tax, but we feel that it is designed to secure a proper share of the profits of North Sea oil for the British people.
    Mr. Waldegrave: Will my hon. and learned Friend consider making a statement on the revenue implications of the Secretary of State for Energy's recent statement on depletion policy?
    Mr. Rees: We are aware of the implications of that statement, but we do not think that it will make a substantial difference to the figures that I gave.
    Mr. Healey: Will the Minister of State explain why the figures that are published in the brown book on the effects of North Sea oil revenue are all in 1978–79 prices and therefore understate by more than half the actual benefit that the Government are deriving from North Sea oil? Will he assure the House that the reason for that is that the Government are now throwing £ 4 billion worth of revenue

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    down the drain in financing unemployment that they have created?
    Mr. Rees: The Government are not throwing any money down the drain. Our costing of the draft manifesto of the Labour Party is that it would throw £20,000 billion down the drain in nationalisation.
    Mr. Healey: Will the Minister answer a question that has been asked repeatedly in the House? Why are the Government understating by more than 60 per cent. in the brown book the actual value of oil to them?
    Mr. Rees: I have given the figures for the current year. As the right hon. Gentleman will know, it was not the practice of either his Administration, nor is it of this Administration, to give forecasts for future years.

    Economic Strategy
    2. Mr. Kenneth Lewis 2. Mr. Kenneth Lewis asked the Chancellor of the Exchequer if he is satisfied that his economic measures are working according to the Government's plans.
    The Chancellor of the Exchequer (Sir Geoffrey Howe): The first priority of the Government's economic policy is to reduce the rate of inflation. There are encouraging signs that our policies are beginning to do that.
    Mr. Lewis: I understand that following the downward slide that we inherited from the previous Government it will take a little time to get up the hill if we are to see the promised land, but does not my right hon. and learned Friend accept that, if industrial and commercial confidence is to return, it must be made clear to industry that we shall soon get out of our inflationary difficulties? Industry will invest when it has hope. Hope is important as a basis for the revival of British industry.
    Sir G. Howe: I am glad to bear in mind the points made by my hon. Friend and to remind him that the downturn in inflation that we saw this month is the first such downturn for two years. I expect to see a further substantial drop in the rate of inflation next month. The fact that it is now two years since the rate began to go up is indicative of the fact that all economic policies are bound to take time to work out.
    Mr. Healey: Is it not the case that the fall in the rate of inflation this month is due entirely to world prices, a factor which is beyond the Government's control, that the fall next month will be due entirely to the fact that the Chancellor has learnt enough not to be as lunatic as he was last year in doubling the rate of value added tax, which then falls out of the index, and that the main effect of the Government's policies so far is to produce unemployment at the level of 1936 and to condemn a whole generation of youngsters to the scrapheap?
    Sir G. Howe: There is concern on both sides of the House about the need to secure a downward movement in unemployment. But, as the right hon. Gentleman told the House on many occasions, the conquest of inflation must precede the conquest of unemployment. When we came into office we inherited a rapidly growing rate of inflation, running at almost 14 per cent. Now, after two years of movement in the wrong direction, we have begun to move in the right direction. We are entitled to take credit for that.
    Viscount Cranborne: In considering the Government's economic policy, does my right hon. and learned Friend accept that there is considerable cause for concern about the very high interest costs that future Governments, as well as the present Government, will have to bear on long-term Government gilt-edged stock? Does he accept that there is now a strong case at least for index linking long-term gilts?
    Sir G. Howe: I appreciate the point made by my hon. Friend about the concern felt about the burden of interest, which is one of the reasons why it is important to reduce the total size of Government borrowing along the lines that we have in mind. The point that he makes about the indexation of gilts has been put forward in many quarters and deserves consideration, but there are many complications on the other side of the account.
    Mr. Haynes: Is the Chancellor aware of the pressure that is being put upon workers to accept smaller wage increases, and that the message seems to be coming right across the nation? Does it also include managers, directors, and all the rest of the people who totally ignore that sort of recommendation and who get

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    away with murder and have done so for many years?
    Sir G. Howe: The hon. Gentleman puts an emotional gloss on the realities. I am grateful to him for telling the House in such plain terms that the message is, as he put it, getting across to the nation in support of the case that there must be moderation in the acceptance of and bargaining for pay settlements at all levels. At every level and in every workplace, people, when determining their pay, must take account of the impact of that on the prospects of their own employment.

    Minimum Lending Rate
    Mr. Sever3. Mr. Sever asked the Chancellor of the Exchequer what further measures he is taking to lower the minimum lending rate.
    The Chief Secretary to the Treasury (Mr. John Biffen): The Government's public spending, taxing and borrowing policies are designed to make it possible for monetary targets to be achieved with lower nominal interest rates in due course.
    Mr. Sever: Does the Minister accept that, particularly in the inner areas—such as Ladywood—of big cities, one of the best opportunities available to the Government for stimulating employment and maximising profit is the stimulation of the small business sector? Does he further agree that the stimulus they are looking for includes an immediate reduction of the minimum lending requirement?
    Mr. Biffen: I accept that the level of interest rates has a very real bearing on the general climate of business optimism and that it is wholly desirable that the Government should have as an objective the achievement of lower interest rates, provided that they are consistent with the monetary aggregates.
    Mr. Budgen: Will my right hon. Friend please explain why the effect upon the money supply of taking off the corset should be disregarded, as is suggested in the Financial Times today?
    Mr. Biffen: I bear many burdens, but what appears in the Financial Times is not one of them.
    Mr. Richard Wainwright: In this connection, will Treasury Ministers at least consider reducing the return net of tax
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    to foreign lenders, as other countries have done, with a view to reducing the inflows into this country which are helping to achieve a gross overvaluation of sterling?
    Mr. Biffen: That is a highly contentious suggestion and I do not think that I can give any answer to it this afternoon.
    Mr. Healey: Is the right hon. Gentleman aware that for once we congratulate him on cutting the minimum lending rate last month, although the subsequent money supply figures showed that the money supply was running outside the Government's target? Is he aware that we shall also congratulate him if he cuts minimum lending rate again in September, in spite of the fact that the unwinding of the corset is likely—according to the Governor of the Bank of England on Monday—to add perhaps over 3 per cent. to the monetary range?
    Mr. Biffen: The congratulations of the right hon. Gentleman will always be assessed in the circumstances in which they are proffered.
    Mr. Bruce-Gardyne: Does my right hon. Friend agree that every Minister, without exception, in every spending Department could well have emblazoned on his wall the motto "Spending less means borrowing less; and borrowing less means lower interest rates for the benefit of the private sector"?
    Mr. Biffen: Yes.

    Exchange Controls
    4. Mr. Parry 4. Mr. Parry asked the Chancellor of the Exchequer what specific powers remain to him to regulate exchange control.
    Mr. Biffen: The Treasury continues to have the powers in the Exchange Control Act 1947 as amended by the Finance Acts 1968 and 1977, and also those in section 2 of the Emergency Laws (Re-enactments and Repeals) Act 1964.
    Mr. Parry: Given the mess of the Government's economic position, will the right hon. Gentleman tell us how long it would take to reintroduce the measures if it became necessary?
    Mr. Biffen: Most of the arguments are to the effect that the difficulties derive from a currency that is valued too highly. Therefore, the Government are

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    not usually asked to reintroduce exchange control.
    Mr. Eggar: Does my right hon. Friend believe that there is any case for inward exchange controls?
    Mr. Biffen: On present evidence, no.
    Mr. Heffer: Whatever the Government do on the question of exchange controls, will the Chief Secretary and his right hon. Friends consider the position that is developing in Ellesmere Port, where 1,500 workers in Bowaters are faced with immediate redundancy because of the imports of paper from the United States of America? Will the right hon. Gentleman look at that in addition to looking at the question of exchange controls?
    Mr. Biffen: I realise that the hon. Gentleman has made a point about which he feels very strongly, and I shall see that it is brought to the attention of my right hon. Friend the Secretary of State for Trade.

    Inflation
    5. Mr. Winnick 5. Mr. Winnick asked the Chancellor of the Exchequer when he expects a substantial reduction in inflation.
    Sir Geoffrey Howe: I expect a substantial fall in the annual rate of increase of the retail price index next month.
    Mr. Winnick: Since the Government were directly responsible for inflation reaching nearly 22 per cent., they can hardly be congratulated now on the fact that there is a tiny reduction. Is the right hon. and learned Gentleman aware that the economic policies of the Government, which are leading to a return of mass unemployment, will leave behind a legacy of hatred and bitterness towards the Tory Party of the sort that was seen in the 1930s?
    Sir G. Howe: The hon. Gentleman must understand that no Government policy is designed to lead or is leading to mass unemployment. As his right hon. Friend the Member for Leeds, East (Mr. Healey) told the House on many occasions, we have found ourselves entering each recession with a higher level of unemployment than on the previous occasion because we have attempted to spend our way out of recession and because of
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    recurrent bouts of inflation. It is only by applying ourselves to the conquest of inflation—the subject of the original question—that we shall be able to deal with unemployment.
    Mr. Nicholas Winterton: Does my right hon. and learned Friend agree that one of the best ways to achieve a reduction in the rate of inflation is to reduce direct taxation, which would reduce the working man's expectation of pay increases? Would that not also lead to production, which is different from productivity, and perhaps change the economic climate of Britain within 24 months?
    Sir G. Howe: My hon. Friend has listed several of the solid reasons in favour of reducing direct taxation. He must remember that, desirable as that objective is, it should not be achieved at the expense of greater borrowing, which would itself involve higher interest rates and, therefore, greater inflation. The two objectives must be balanced against each other.
    Mr. Healey: Does the right hon. and learned Gentleman accept the view that Mr. Frank Cassell of the Treasury put to the Select Committee last week—namely, that the rate of inflation could be over 26 per cent. if the Government had not permitted an increase in the value of the pound, which is now strangling British industry and producing excessive unemployment? By how much does he expect the rate of inflation to rise as a result of the fall in the value of the pound if he is successful in his other objective of reducing interest rates?
    Sir G. Howe: The right hon. Gentleman has attempted to condense a series of economic propositions into a short sentence. Our objective remains that of securing the reduction of inflation. We can resume discussion of the wider topics in next week's debate.
    Mr. Hal Miller: Does my right hon. and learned Friend understand the fear in manufacturing industry that is bearing the brunt of the Government's attack on inflation through high interest rates and that not enough has been done to control public expenditure and public borrowing? Will he comment on that?
    Sir G. Howe: I well understand the extent to which business, small and

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    large, is concerned about the continuation of high interest rates. That is why our objective has been so firmly concentrated on the reduction of public borrowing and public spending. I am grateful to have my hon. Friend's support for that policy.

    International Monetary Fund (Substitution Account)
    6. Mr. Hooley 6. Mr. Hooley asked the Chancellor of the Exchequor when further talks will take place in the International Monetary Fund on the creation of a substitution account.
    Sir Geoffrey Howe: Possibly at the next meeting of the interim committee to be held in Washington on 28 September.
    Mr. Hooley: Is the Chancellor aware that reform of the international monetary system was one of the main recommendations of the Brandt commission? What proposals are the Government to put forward for making more acceptable as a reserve unit the special drawing rights?
    Sir G. Howe: I appreciate that that was one of the matters contained in the Brandt commission's report. It was discussed at the summit meeting at Venice. We shall be returning to the question of the substitution account and the wider issues at the meeting of the fund in September.
    Mr. Goodlad: Does my right hon. and learned Friend accept that an alternative to the IMF substitution account in helping to recycle OPEC surpluses is the greater use of debt instruments, the repayment terms of which are related to the price of certain commodities so that the risk to the lender is related to commodities and not only currencies? Therefore, the risk to the borrowing country, which may be a less developed country with only one commodity as its product, is that much reduced.
    Sir G. Howe: That is one of the methods that could be studied to deal with the problem that my hon. Friend has in mind. It is right to acknowledge the scale of the difficulties that arise for the less developed countries as a result of the large increase in oil prices last year and the consequent redistribution of funds throughout the world.
    Mr. Horam: Has the right hon. and learned Gentleman seen the recent suggestions made about commodity bonds and oil bonds, which follow on from the question of the hon. Member for North-wich (Mr. Goodlad)? Will he ensure that these suggestions, which are valuable and imaginative, are pursued seriously at the appropriate international level?
    Sir G. Howe: I shall ensure that the proposals are studied.

    Exchange Controls
    7. Mr. Dalyell 7. Mr. Dalyell asked the Chancellor of the Exchequer if he will make a statement on his latest assessment of the effect of dismantling exchange controls.
    Mr. Biffen: Capital outflows since the dismantling of exchange controls seem to have been running at about £ 1 billion a quarter, for the greater part representing repayment of foreign currency debt by United Kingdom companies. Overseas purchases of sterling assets over the same period have more than offset these outflows.
    Mr. Dalyell: To use the Chancellor's words and to telescope a series of economic propositions into a single sentence, is it not none the less true that it would be more comfortable to make moves towards a less strong pound if there were a fallback of some sort of exchange control machinery? Given the reply to my hon. Friend the Member for Liverpool, Scotland Exchange (Mr. Parry), do we take it that the 1964 and 1977 machinery is adequate to bring back exchange controls should outside events unwelcome to the Government make that practicable and necessary?
    Mr. Biffen: I should require notice of the latter part of the hon. Gentleman's question.
    Mr. Campbell-Savours: Why?
    Mr. Biffen: It will be asked in good faith and answered in good faith. The residual law is kept in being on account of European Community obligations. I do not believe that it is to the advantage of the economy to try to proceed towards a situation in which either the inflow or outflow of capital is more restricted. I believe that we should move to a regime that seeks greater liberalisation.
    Mr. Wickenden: Does my right hon. Friend accept that those of us who bear the responsibility of trying to create employment and who are doing so take great pleasure in the fact that we have been set free from the shackles of exchange controls and enabled to create employment?
    Mr. Biffen: I take account of my hon. Friend's remark. Although this is a fairly esoteric subject, it sharply divides in the starkest philosophic terms the differences between the two sides of the House.
    Mr. Arthur Lewis: Is the Minister aware that the motor car manufacturing industry is in great difficulties? Is he also aware that at the same time almost all foreign car manufacturers are advertising their cars for sale on 5 per cent. loans, a rate that is a third of the going rate in Britain? Will he examine the terms of this financing to ascertain the extent of the manoeuvring and manipulation of exchange controls that is enabling foreign firms to sell their cars in Britain at the expense of British manufacturers and to manoeuvre interest rates so that they can advertise loans costing only 5 per cent?
    Mr. Biffen: I shall have that matter investigated. I am not immediately certain that there is any Government responsibility.

    Tax and Price Index
    8. Mr. Ioan Evans 8. Mr. Ioan Evans asked the Chancellor of the Exchequer what are the latest figures for the tax and price index.
    Mr. Peter Rees: The tax and price index rose by 17.4 per cent. over the 12 months up to June 1980.
    Mr. Evans: In view of the fact that there have been over 9,000 price increases this year, that the Government have doubled the rate of inflation, that they have introduced a new index that gives a better impression than the RPI, and that it might be higher than the RPI in August because VAT is coming out of the RPI, will the hon. and learned Gentleman consider introducing a new index—a tax, prices and unemployment index?
    Mr. Rees: I suspect that the two indexes are enough.
    Mr. Jay: When will the rate of price inflation fall to the level at which it stood when the Government took office?
    Mr. Rees: It would be a rash person who made such a prediction with utter confidence. As my right hon. and learned Friend has said, we hope that it will fall to 16½ per cent. by the autumn.

    European Community (United Kingdom Membership)
    9. Mr. Marlow 9. Mr. Marlow asked the Chancellor of the Exchequer what further discussions have taken place with European finance ministers concerning the total cost to the United Kingdom of European Economic Community membership.
    Sir Geoffrey Howe: The Finance Council last held an extended discussion of the overall economic effects of Community membership in October 1979. The subject is, moreover, highly relevant to the longer-term review provided for in the agreement of 30 May.
    Mr. Marlow: When my right hon. and learned Friend next meets the Finance Ministers in Europe, will he draw their attention to the fact that food and feed stuffs, imported last year under the common agricultural policy, at common agricultural prices, gave us a bill of some £627 million beyond and above the price that we would have to pay if we had bought the same goods on the world market? If we had bought our stuff on the world market, and not under the CAP, it would have made no difference to the world's supply and demand situation, and we could have made a saving of £627 million. This constitutes a real increase to the budget deficit. Will he bring this fact to the attention of the Finance Ministers and ensure that they take good account of that in any future financial calculations?
    Sir G. Howe: Without doubting the figures that my hon. Friend has quoted, I accept the extent to which the common agricultural policy and other aspects inflict significant non-budgetary losses on the commodities that he mentioned. We drew that to the attention of Community Finance Ministers during negotiations, which were directed in the first instance at the budgetary problem. We shall certainly draw that point to their attention during the next stage of our discussions on the structure of the budget.
    Mr. John Garrett: What is the Treasury's current estimate of the total cost of Britain's membership of the EEC?
    Sir G. Howe: It is not possible to produce a total cost. It must be remembered that there are factors on both sides of the account. For example, there has been a substantial increase in our exports to Europe and those exports have increased at a faster rate than our exports to other overseas markets. I do not wish to mislead the House or the hon. Gentleman. When we reach the next stage of the negotiations on the structure of the budget—provided for in the agreement of 30 May—all those matters should be, and will be, taken into account.
    Mr. Budgen: Will my right hon. and learned Friend explain the principles that will apply to reforming the EEC budget?
    Sir G. Howe: The main principle is to ensure that it operates fairly for all member States and provides a stable roundation for the long-term financing of the Community.
    Mr. Spearing: When the Chancellor of the Exchequer deals with" all those matters", will he include the cost of the increased unemployment that has resulted from our membership of the EEC? Will he estimate the additional cost of unemployment pay to fishermen, both now and in the future?
    Sir G. Howe: I know that the hon. Gentleman if often prepared to attribute many misfortunes to our membership of the Community. However, it would be wrong to assume that our membership has had an adverse effect on employment in Britain. Our exports to the Community have been increasing at a faster rate than our exports to other parts of the world. That should be borne in mind.
    Mr. Dorrell: In calculating the total cost-benefit balance of our membership of the EEC, will my right hon. and learned Friend bear in mind that Europe is this country's largest and fastest growing market, and that we have no interest in isolating ourselves from our most important customers?
    Sir G. Howe: I am grateful to my hon. Friend, as he has emphasised the point that I have been trying to make. I repeat that last year our exports to
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    the Community increased by 30 per cent., while our exports to the rest of the world increased by only 8 per cent. It is important to remember the significance of our trading links with the Community.
    Mr. Cryer: Is it not true that our imports from the EEC have been growing at a more rapid rate, and that we have a deficit of between £2·5 billion and £3 billion? Does he not accept that the Venice charade allowed us to have some of our own money back, with the EEC's permission? Does not that mean that there has been a shift away from the United Kingdom Parliament, in relation to the right to raise taxes and to decide on expenditure? Is it not true that the EEC Commission will now decide how the money is to be spent?
    Sir G. Howe: As regards the significant point that the hon. Gentleman has raised, the deficit on visible trade increased in money terms, but in real terms there has been a small net reduction in our deficit with the Community. I am not sure how the hon. Gentleman has managed to confuse what took place in Venice with what took place within the Community. There is no connection between the two.

    Tax Evasion
    10. Mr. McCrindle 10. Mr. McCrindle asked the Chancellor of the Exchequer if he is satisfied that no further action is required to combat tax evasion.
    Mr. Peter Rees: No, Sir. That would be too complacent. but the Board of Inland Revenue and the Board of Customs and Excise are constantly improving their techniques to combat tax evasion, and that is reflected in the results achieved.
    Mr. McCrindle: If my hon. and learned Friend is as concerned as I am about the substantial loss of revenue that may result from tax evasion, and if he bears in mind the fact that small business men are already subjected to random VAT tests and that suspected social security scroungers may be visited by social security inspectors, should not the Treasury appoint inspectors to carry out random tests of those suspected of avoiding income tax? That would be in the interests of the taxpayer.
    Mr. Rees: My hon. Friend will be aware that a new special office has been

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    opened in Sheffield, and that the special office in London has been strengthened. In-depth checks are conducted on income tax returns.
    Mr. Richard Wainwright: In view of the growing and justified sense of unfairness at the failure to collect income tax effectively—despite uneven pressure on certain taxpayers—how much longer will Treasury Ministers claim that PAYE has an advantage because it does not require an income tax return each year from millions of taxpayers?
    Mr. Rees: If the hon. Gentleman is suggesting that we should change to a system of self-assessment, he should bear in mind the considerable cost imposed on taxpayers in the United States of America.
    Mr. Michael Brown: Will my hon. and learned Friend speculate upon whether his Department is satisfied with the operation of section 32 of the Inland Revenue Regulation Act 1890? How does he ensure that evidence from informers is reliable? Is he satisfied with the operation of the Act?
    Mr. Rees: Neither I nor any other Treasury Minister is concerned with the information given by informers. As the House will know, and as I have made clear in a written answer today, the conduct of individual cases is exclusively a matter for the Inland Revenue. As my hon. Friend will know, the amounts paid to informers are very small. Whether the evidence is valid and trustworthy is exclusively a matter for the Inland Revenue to decide in the first instance.
    Mr. Ron Brown: Are not the Government covering up for scroungers at the top, and for those who back the Tory Party? Does not that typify the fact that this Government are a class Government, who are unwilling to take any action against those who take away the wealth that rightly belongs to the Exchequer? Why do not the Government do something? Is not it a fact that the Government are willing to attack working class people and those on social security benefit but that they are not willing to deal with their own kind? The country will judge the Government in due course.
    Mr. Rees: The hon. Gentleman has completely misunderstood the position. The Inland Revenue is charged with the duty of collecting tax and of initiating
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    proceedings whenever it thinks it is justified. No Treasury Minister is to the slightest degree concerned with such operations.

    Unemployment Costs
    11. Mr. Straw 11. Mr. Straw asked the Chancellor of the Exchequer what estimate he makes of the gross cost to the Exchequer of unemployment in the United Kingdom in (a) 1979, and (b) 1980 in terms of national insurance contributions and direct and indirect tax forgone, and social security and other benefits paid out.
    Mr. Biffen: The cost of the payment of unemployment and supplementary benefits to unemployed persons in 1979–80 was £1,400 million. It is not possible to make a meaningful estimate of the additional information sought in relation to tax and social security benefits.
    Mr. Straw: Is the Chief Secretary aware that his right hon. Friend the Minister of Agriculture, Fisheries and Food has made a meaningful estimate of those other costs? Is he not aware that he put that cost at £7,000 million, or three-quarters of the public sector borrowing requirement? Given that unemployment now costs three-quarters of the PSBR, and that the cost of maintaining people in work by means of sensible support schemes is less than the cost of throwing them out of work, is not the Chief Secretary aware that one can draw no other conclusion but that the Government are wilfully and unnecessarily forcing people out of work?
    Mr. Biffen: No text exists indicating the figure of £7,000 million. That figure has been attributed to my right hon. Friend the Minister of Agriculture by newspaper cuttings alone. It would not be appropriate for the House to proceed on the basis of newspaper cuttings. Our determination is to contest unemployment. To secure a victory over unemployment there is a prerequisite of a victory over inflation.
    Mr. Joel Barnett: Given that the Government argue that the level of unemployment is not their fault but that of pay settlements, is the Chief Secretary prepared to predict that if pay settlements in the next round are about 10 per cent. or lower unemployment will not reach 2 million and, indeed will fall next year?
    Mr. Biffen: The long and hallowed tradition in the Treasury is that unemployment forecasts are never made. That tradition was followed religiously by the right hon. Member for Leeds, East (Mr. Healey). I intend to follow that tradition.
    Mr. Healey: Am I right in assuming that the right hon. Gentleman occasionally meets the Minister of Agriculture, Fisheries and Food socially, if not in the Cabinet room? Would he care to ask the Minister to confirm the report that he gave an estimate of £7,000 million as the cost—if I might correct my hon. Friend the Member for Blackburn (Mr. Straw)—not of the current level of unemployment which is 1·9 million, but of 1½ million unemployed? Will the right hon. Gentleman have a word with the Minister and find out what he actually said and say whether he agrees with it?
    Mr. Biffen: Since I do not believe in trial by newspaper cutting I would not dream of doing that.

    Farmhouse Cider
    12. Mr. Speller 12. Mr. Speller asked the Chancellor of the Exchequer what proposals are being considered within the EEC to require farmhouse cider of a strength above 8·5 per cent. to be treated for revenue purposes in the same way as table wine.
    Mr. Peter Rees: Proposals were put forward by the Commission last year which if accepted would result in cider of a strength above 6 per cent. being subjected to the same duty as table wine. The Commission has, however, made clear that it is prepared to agree to amending this limit to 8·5 per cent. This would represent little difference in practice from the present borderline of 8·7 per cent. between the cider duty and the made-wine duty.
    Mr. Speller: Is my hon. and learned Friend aware that in Devonshire the proposal would result in scrumpy costing 75p a pint? Furthermore, is he aware that it would result in the industry being put flat on its back? Does he agree that this, like many matters related to the Community, is intended in due course to bring the tax level on wine down to that of cider rather than vice versa? May we have an assurance that we shall not see the 75p pint in our lifetime?
    Mr. Rees: It is not for me to speculate on the effects of scrumpy on my hon. Friend's constituents. I reassure him and the House that the Government and the Commission are aware of the impact of increased duties on the cider industry, which is a small industry featuring particularly in the economies of my hon. Friend's county and Hereford.

    Inflation
    13. Mr. Canavan 13. Mr. Canavan asked the Chancellor of the Exchequer what is the current rate of inflation.
    15. Mr. Flannery 15. Mr. Flannery asked the Chancellor of the Exchequer what is the current rate of inflation; and what it was in 1979 and 1978 at this time of year.
    Sir Geoffrey Howe: The retail prices index rose by 21 per cent in the 12 months up to June 1980. In the comparable periods up to June 1978 and June 1979, the index rose by 7·4 per cent and 11·4 per cent respectively.
    Mr. Canavan: Since we have one of the lowest wage economies in Western Europe, why does the Chancellor blame so-called high wages for the high rate of inflation which he has created? When he said in his television broadcast last week that we are paying ourselves too much for producing too little, was he referring to himself since he will soon be earning £30,000 a year for producing nothing but high inflation and record unemployment?
    Sir G. Howe: I wish the problems about which the hon. Gentleman is obviously anxious were capable of being solved by abuse of that kind. He must note that even from the figures that I have given the rate of inflation has been increasing for the last two years. The downturn this month is the first step in the right direction. The problem about our economy and the comparison between standards of living is that even in the last two years pay rose 10 times faster than productivity. That is the reason for the difference in our living standards and those in the rest of Western Europe.
    Mr. Flannery: Will the Chancellor of the Exchequer admit that his Government's policies more than doubled the rate of inflation that existed when the Labour Government left office? When

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    will he admit that the Government's policies are an utter failure and that they are so doctrinaire as to be almost unbelievable? Does he accept that there is further unemployment in the pipeline and that the situation has run away with the Government, who have no idea how to handle this dreadful situation?
    Sir G. Howe: Far be it from me to enter a competition in doctrinairism with the hon. Gentleman.
    Mr. Cryer: The Chancellor would win.
    Sir G. Howe: I remind the House that the rate of inflation when we came to office—the rate at which prices had been rising in the last six months of the Labour Government—was substantial—14 per cent.—and rising.

  PRIME MINISTER (ENGAGEMENTS)
  Q1. Mr. Robert Atkins Q1. Mr. Robert Atkins asked the Prime Minister if she will list her official engagements for 24 July.
  The Prime Minister (Mrs. Margaret Thatcher): This morning I presided at a meeting of the Cabinet. In addtion to my duties in this House, I shall be having further meetings with ministerial colleagues and others.
  Mr. Atkins: Will my right hon. Friend find time during her busy day to make it clear that she is determined to maintain Britain's nuclear deterrent? Will she also make it clear to those who are interested in these matters overseas that the march planned by the Campaign for Nuclear Disarmament on 26 October, even though it is supported by members of the Labour Party, dos not represent the views of the British people?
  The Prime Minister: We announced our decision to keep our independent nuclear deterrent by announcing the decision to purchase Trident. I believe that the British people are firmly behind a policy which leaves us master of our own destiny. The policy has been warmly welcomed by our allies. It makes it clear that we are resolved to defend our own freedom.
  Miss Joan Lestor: Bearing in mind the Prime Minister's advocacy that
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  people should be prepared to move from one area of the country to another to seek employment, will the right hon. Lady find time today to visit Slough which, until now, has been an area of fairly high employment but where unemployment has increased dramatically in the last month and where the number of job vacancies has fallen dramatically? Will she explain where the unemployed of Merseyside and other places are supposed to find jobs? Will she explain, if they move to areas such as Slough, in view of the malicious housing policy operated there, how they will find accommodation?
  The Prime Minister: I think that it is reasonable to expect that there must be some mobility and that people should be willing to move to where the jobs are available. [Hon. Members: "Where?"] One has only to look in the situations vacant columns in many newspapers to discover where the jobs are available. Fortunately, the number of job vacancies has not yet fallen as far as it did under the previous Government, although it is fairly low. The number of vacancies reported to jobcentres is only about one-third of the jobs available.
  Mr. Latham: In view of the current price war in the high streets and the reduction in private sector settlements, is not it increasingly important that there should be a lower level of public sector settlements and that industries such as the Post Office which reach high settlements should not be allowed to exceed their cash limits?
  The Prime Minister: I agree with my hon. Friend. It is crucial for us to get public sector settlements down, if only because the money is drawn out of the private sector. It is to the private sector that we must look for increasing numbers of jobs. People in the public sector who go in for large settlements must keep within their cash limits.
  Mr. James Callaghan: When the Prime Minister said in South Wales last Saturday that people without work should move to areas of industrial success, to which areas was she referring? Will she also please tell us what effect she thinks the removal of skilled workers from South Wales will have on the communities that they leave behind?
  The Prime Minister: Wales has always been accustomed to a certain amount of

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  mobility. After all, that was how people come to move to where the jobs were. When coalmining ceased in the Rhondda and steel ceased at East Moors or Ebbw Vale, for example the people were prepared to move to other jobs. I was a Minister in the Department of Education and Science and I know that many many teachers came from Wales. Mobility is nothing new to Wales.
  Mr. Callaghan: Does not the Prime Minister realise that the mobility of the 1930s left behind a bitterness that has not been forgotten? Does she not realise also that with the consent of both Governments a successful policy of taking work to the regions was started, which has revived the prosperity of South Wales, and that we will simply not return to her kind of policies?
  The Prime Minister: I do not believe that it is possible to guarantee everyone a job where he happens to live. I am delighted to see that the right hon. Gentleman agrees with me. There must be some mobility to enable people to move to where the jobs are. [Hon. Gentlemen: "Where?"] There are some 400,000 vacant jobs on the usual method of calculation, if people are willing to take them. There must be some mobility if young people want jobs, as there always has been. [Hon. Gentlemen: "Where?"] The right hon. Gentleman is making a terrible—
  Hon. Members: Where are the jobs?
  Mr. Speaker: Order.
  Mr. Callaghan: Will the Prime Minister now please tell us to which areas she believes the unemployed steel workers in South Wales should move?
  The Prime Minister: Some of them will move within Wales where there are jobs. [Hon. Gentlemen: "Where?"] That is why some £48 million has been allocated especially to South Wales to help with advanced factories and help other factories go there. Other factories will go there. However, they will not go anywhere if they face total rigidity in labour and embittered labour. That is the worst reputation that any politician can give to an area.
  Q2. Mr Bob Dunn Q2. Mr Bob Dunn asked the Prime Minister if she will list her official engagements for Thursday 24 July.
  The Prime Minister: I refer my hon. Friend to the reply which I have just given.
  Mr. Dunn: Will the Prime Minister find time today to consider how best to persuade some of our European Allies that their refusal to take NATO missile bases on their soil will be seen as a dangerous drift towards neutrality, a position that would undoubtedly delight pro-Soviet sympathisers in this country and elsewhere?
  The Prime Minister: I assume that my hon. Friend is referring to cruise missiles. Before Christmas NATO decided to accept cruise missiles on the soil of NATO countries. No NATO country has so far refused to accept those missiles, although two have still to make a formal decision to accept them. Most NATO countries already have nuclear weapons on their soil, which indicates their firm determination to defend the Western way of life.
  Mr. Donald Stewart: Will the Prime Minister take time today to consider the total collapse that has overtaken the Scottish fishing industry? Will she call urgent meetings with the Ministers concerned to discuss financial assistance and protection, and, in view of her laudable aim that we should be masters of our own destiny, will she, if necessary, take unilateral action, regardless of what the EEC may think?
  The Prime Minister: My right hon. Friend the Minister of Agriculture, Fisheries and Food is involved in negotiating a fisheries agreement with our European partners. I understand that he will report to the House in a statement after questions. Some of the firms concerned already have money left from the £3 million that was allocated to the fishing industry. Others are in considerable difficulty, and my right hon. Friend is considering how best to help.
  Mr. John Wells: Is my right hon. Friend aware that many of us are very sorry that she is not enjoying any official meals today? The next time that she has an official meal, will she take note that one-third of its value will come from horticultural produce? Will she further take note of the plight of the British horticultural industry? Is she aware of the sedentary interventions of the hon.

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  Member for Salford, East (Mr. Allaun) during her reply to a similar question, when he kept pathetically squeaking "Holland, Holland"?
  The Prime Minister: It is a matter of some relief that I have no official meals today. I know of the splendid work done by my hon. Friend in trying to help the horticultural industry. He will be the first to accept that my right hon. Friend the Minister of Agriculture, Fisheries and Food has been very active indeed, in protecting the British horticultural industry, particularly over matters like strawberry pulp and apples.
  Mr. Alton: Will the Prime Minister take time today to consider the latest unemployment figures on Merseyside, where there is a new post-war record of 107,000 people out of work, which is 14 per cent. of the population? What advice can I give to two young constituents of mine who last week, no doubt following her advice, went to the island of Guernsey seeking employment, and were thrown off the island and told that there were no job prospects for them there?
  The Prime Minister: The hon. Gentleman asks what advice one can give. We have increased the number of opportunities available under the youth opportunities programme with the object of trying to help young people who are out of work to gain work experience. I hope that those who do not have a job will take advantage of the scheme. Alternatively, I hope that they will go to one of the skillcentres to acquire a skill. Skillcentres still do not have full occupancy. One of the ironies of the unemployment situation is that there is still a shortage of skilled people in some parts of the country.
  Mr. Waldegrave: Does my right hon. Friend accept that the 334 hon. Members who signed early-day motion 17 will have welcomed the way that the British Government voted at the International Whaling Commission? Does she agree that the failure of the meeting to take action on whaling enables the British Government to take the lead by unilaterally banning the import of whale products?
  The Prime Minister: I am grateful to my hon. Friend. It is nice to be con-
  766
  gratulated now and then. I am glad that the British Government took a lead on a commercial moratorium on catching whales. We also took a lead in prohibiting the import of sperm whale products.
  Q3. Mr. Newens Q3. Mr. Newens asked the Prime Minister if she will list her official engagements for Thusrday 24 July.
  The Prime Minister: I refer the hon. Gentleman to the reply which I gave earlier.
  Mr. Newens: Does the Prime Minister recognise that her policies are not only ruining industry throughout the country, including the more prosperous South-East, and not only in horticulture, which was referred to by the hon. Member for Maidstone (Mr. Wells), but also in furniture and many other manufacturing industries? Is she aware that in the past the growth of unemployment led to an outbreak of Fascism and other extremist creeds in other parts of the world, and that if she pursues her present policies she will produce vast social unrest for this country? Does she accept that the only way forward is for her to renounce her policies and for the country to be reoriented in a proper Socialist direction?
  The Prime Minister: The short answer is "No, Sir". The hon. Gentleman forgets that during the lifetime of the previous Labour Government some 700,000 manufacturing jobs were lost, car production fell by over 30 per cent. and steel production by over 6 million tonnes a year.
  Mr. Rhodes James: Has my right hon. Friend's attention been drawn today to the fact that the Social Democratic Alliance has announced the number of constituencies that it proposes to challenge at the next general election, and that most of its members are former leading members of the Labour Party-
  The Prime Minister: That does not surprise me. I believe that there is only one party and one policy for Britain at the moment; and that is ours.
  Mr. Ron Brown: Is it not about time that the Prime Minister came clean and admitted that her Government are a Government of double standards, because, on the one hand, basic social services are being destroyed, while, on the other,

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  record sums are being spent on armaments, which is money spent on killing people? Is it not time that the Government faced up to reality and resigned, so that we may have an early general election?
  The Prime Minister: No, Sir.

  BUSINESS OF THE HOUSE
  Mr. James Callaghan: May I ask the Leader of the House to state the business for next week?
  The Chancellor of the Duchy of Lancaster and Leader of the House of Commons (Mr. Norman St. John-Stevas): The business for next week will be as follows:
  Monday 28 July—Motions on the social security orders on benefits up-rating, family income supplement, child benefit uprating, pensioners' lump sum payment, married women and widows' special provisions, and Supplementary Benefit (Resources) and (Requirement) Regulations.
  Motions relating to the Supplementary Benefit (Single Payment) Regulations, the (Aggregation) Regulations, the (Deductions and Payments to Third Parties) Regulations and the (Transitional) Regulations.
  Consideration of Lords amendments to the Employment Bill.
  Proceedings on the following four Lords consolidation measures:

  Education (Scotland) Bill

  Water (Scotland) Bill

  Solicitors (Scotland) Bill

  Criminal Appeal (Northern Ireland) Bill

  Second Reading of the Highways Bill [Lords].

  Tuesday 29 July—Debate on the Opposition motion of no confidence in Her Majesty's Government.

  Motions relating to the Notification of Accidents and Dangerous Occurrences Regulations and the Industrial Tribunals (Rules of Procedure) Regulations.
  Wednesday 30 July—Supply [28th Allotted Day]: Until about 7 o'clock, debate on a Liberal motion on the indifference of Her Majesty's Government to the plight of small businesses. Afterwards, debate on an Opposition motion on the disastrous effects of Government policies on the textiles and clothing industries.
  Motion on the Education (Assisted Places) Regulations.

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  Remaining stages of the Law Reform (Miscellaneous Provisions) (Scotland) Bill.
  Motion on the International Monetary Fund (Increase of Subscription) Order.
  Thursday 31 July—Supply [29th Allotted Day]: The House will be asked to pass all the outstanding Votes.
  Debate on developments in the European Communities January-December 1979 (Cmnd. 7780.)
  Friday 1 August—Debate on the prison system, and on the report of the May committee (Cmnd. 7673.)
  Monday 4 August—Proceedings on the Consolidated Fund (Appropriation) Bill.
  The House will wish to know that subject to progress of business it is hoped that the House will rise for the Summer Adjournment on Friday 8 August.
  Mr. Callaghan: If there were room for another motion of no confidence next week it would be on the handling of Government business. On any count—and this ought to appeal to Conservative Back Benchers as much as to any other hon. Members—Monday is a disgraceful day. Trying to stuff everything into one day is treating Parliament with contempt. The Leader of the House should reconsider what he is doing, quite apart from the fact that the major item of business is to rob those on social security of part of the benefit that they need and are entitled to.
  In view of the business proposed for Monday, and bearing in mind that there is also a motion of no confidence on Tuesday and a Supply day on Wednesday, will the right hon. Gentleman undertake to see that no lengthy statements will be made on those days, so that the House may proceed with its business forthwith?
  Mr. St. John-Stevas: I shall endeavour to reduce the number of statements to a minimum, but the House has a right to hear statements on major matters of Government policy. I find the right hon. Gentleman's strictures on the arrangement of business for Monday quite extraordinary. He should know that these things are done by arrangement and agreement.
  Mr. Callaghan: The Leader of the House should not attempt to deceive us. He knows that the Government put forward the business and the Opposition do not have control over it. If the right hon. Gentleman is good enough to tell us what he proposes to do and sometimes to make adjustments, that is within his power and we thank him for his courtesy when he does it. However, I still say that Monday is a grossly overloaded day and the right hon. Gentleman should not have arranged the business in that way.
  Mr. St. John-Stevas: I am grateful to the right hon. Gentleman for what I take to be a withdrawal.
  Mr. Callaghan: The Leader of the House should not say that sort of thing. Is he trying to get business through or not? He knows that far too much is being put into next week. I repeat my request. If it is wished to make statements before the House rises, the right hon. Gentleman should adjust the business accordingly. He should not expect us to have long statements, which take time, because hon. Members wish to question Ministers, and the sort of business that is proposed for Monday. The right hon. Gentleman should not allow that to happen on Monday, Tuesday or Wednesday.
  Mr. St. John-Stevas: Taking into account the desire of the House to hear statements, I shall do what I can to meet the right hon. Gentleman's wishes.
  Mr. du Cann: Will my right hon. Friend confirm his undertaking that we are to have a debate on procedure, preferably before the Summer Recess? Will he be in a position to make a statement next week on the matters that we discussed on Monday?
  Mr. St. John-Stevas: I am glad to be able to tell my right hon. Friend that we shall have a debate on procedure, as promised, before we rise. The matters concerning hon. Members that were discussed and voted on by the House this week are being considered by the Government. Complex issues are involved in relation to some of those matters, particularly pensions, and I shall be making a statement next week.
  Mr. Beith: How will the first part of Monday's business be dealt with? Will it, as it could in theory, be on nine

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  separate motions of one and a half hours each?
  Mr. St. John-Stevas: No. That would be inconvenient for the House. The arrangements are that there will be a general debate on the motions and that the outstanding votes will be taken at 10 o'clock.
  Several Hon. Members Several Hon. Members rose—
  Mr. Speaker: Order. I remind the House that there are statements to follow. I hope that questions will be as brief as possible.
  Mr. Forman: Can my right hon. Friend assure us that once we have got all the necessary Government business on to the statute book we shall move towards the fulfilment of our election promise to go for minimum legislation?
  Mr. St. John-Stevas: It is the aim of the Government in the next Session to have less legislation. It is no part of Conservative policy to introduce legislation for its own sake. By the time the current Session is over, three-quarters of the legislation promised in the Conservative manifesto will, subject to one or two amendments, have been fulfilled.
  Mr. Heffer: As the Leader of the House has not said when the House is to come back after the recess, will he give an assurance that if the inevitable announcement of 2 million unemployed is made during the recess the House will be recalled in order to discuss that matter?
  Mr. St. John-Stevas: I hope that that eventuality will not arise. Any recess is subject to the recall of Parliament and any hon. Member is at liberty to make representations, in given circumstances, that the House should be recalled.
  Mr. John Wells: Is my hon. Friend aware that the House is becoming steadily more bored with the conduct of the Leader of the Opposition, who, during the course of the past week, misbehaved, notably during the concluding stages of Monday's debate by thumping the Dispatch Box and failing to pay attention to the Chair, who has consistently, throughout Question Time today, made an exhibition of himself, and who again, just now, showed his fundamental ignorance of the way in which the business— [Interruption].
  Mr. Speaker: Order. What I could hear of the hon. Gentleman's remarks did not appear to have much to do with the business for next week.
  Mr. Skinner: Will the Leader of the House encourage the responsible Minister to make a statement about the military takeover in Bolivia? [Hon. Members: "Where is your tie?"] Has the right hon. Gentleman seen— [Interruption.]—
  Mr. Speaker: Order. I am protecting the hon. Gentleman. The House seems to be in an excitable mood, but we should hear the question from the hon. Member for Bolsover (Mr. Skinner).
  Mr. Skinner: Conservative Members are out of control. Will the Leader of the House encourage the responsible Minister to make a statement condemning the military takeover in Bolivia? Will he take heed of early-day motion 831 and others signed by many Opposition Members? [That this House calls upon Her Majesty's Government to condemn the military takeover in Bolivia; support the valiant actions of miners and other workers in their efforts to achieve democratic government; and strongly suggests that Her Majesty's Government act in concert with the United States and West German Govermnents in denouncing the coup, withdraw all financial aid, and do not recognise this new regime.] Will he ask Ministers to follow the example of the United States, West Germany and many other Governments who have refused to recognise the new regime? Will he ensure that any financial aid that was promised will be withdrawn?
  Mr. St. John-Stevas: On behalf of the Government I can say straight away that we strongly deplore the military intervention in Bolivia, which followed peaceful and properly conducted elections. We hope that this completely unjustified interruption of the democratic process will be short-lived. Foreign Ministers of the Nine have condemned the coup. Heads of EEC missions, including our ambassador, have put on record with the military authorities their concern about the bloodshed that has already been caused. As for the aid project, the military intervention is a new factor that has to be taken into account. I hope that the hon. Gentleman will be satisfied with that forthright statement.
  Mr. McQuarrie: Will my right hon. Friend make time available within the course of next week for a full-scale debate on the fishing industry, in view of the desperate position of that industry, both onshore and offshore, as brought to light in questions today and by the general situation throughout the country?
  Mr. St. John-Stevas: I am well aware of the importance of that matter, but I am afraid that I cannot promise a full debate before the recess.
  Mr. Fitt: Will the Leader of the House ensure the presence of the Secretary of State for Northern Ireland at the censure motion debate next Tuesday to give him an opportunity to refute the sentiments expressed during the week by the right hon. Member for Down, South (Mr. Powell)? Will he also suggest to the Secretary of State that he should make a statement at the earliest opportunity on the unlawful and unjustified killing of a young boy in the streets of Belfast last night by the RUC?
  Mr. St. John-Stevas: I shall certainly draw those matters, particularly the second, to the attention of my right hon. Friend.
  Mr. Kershaw: Has my right hon. Friend seen early-day motion 807, dealing with the position of overseas students from Hong Kong?
  [That having regard to the mutually beneficial relationship between Hong Kong and this country, this House calls on Her Majesty's Government to rectify the anomaly by which students from Hong Kong and other British dependent territories are obliged to pay full fees at British universities whilst students from the European Economic Community and French dependent territories are subsidised by the British taxpayer.]
  As nothing much seems to be happening on Monday, can the debate take place on that day?
  Mr. St. John-Stevas: I have seen the motion— [Interruption.] I have seen it only recently, but I have certainly seen it. The relationship between this country and the Crown colony of Hong Kong is a special one. The Government are glad to welcome Hong Kong students to our academic institutions. I shall look again at the business for Monday to see whether my hon. Friend's motion can be added.
  Mr. Winnick: In view of the right hon. Gentleman's remarks about Bolivia, when will the House have a debate on the lifting of the arms embargo to Chile? Is the right hon. Gentleman proud to be a member of a Government that permit arms to be sold to the gang of murderers and torturers who destroyed democracy in Chile in 1973?
  Mr. St. John-Stevas: As the hon. Gentleman knows, the Government have revised the policy of the previous Government on Chile. We have decided that the total embargo imposed by the previous Government on such sales should be lifted. That is the Government's position.
  Mr. Pawsey: Is my right hon. Friend aware that many hon. Members on the Government side of the House are awaiting anxiously the statement on civil defence? Is he able to advise the House when such a statement might be made?
  Mr. St. John-Stevas: I shall certainly draw that request to the attention of my right hon. Friend.
  Mr. Greville Janner: In view of the recent collapse of the House of Lords, will there be a statement at some time on the action that the Government propose to take on the repair, maintenance and cleaning of the Palace of Westminster?
  Mr. St. John-Stevas: We are looking into the question of the safety of the House of Commons. I have noted what happened in the other place. I can assure the hon. and learned Gentleman that I have made inquiries. I understand that no hon. Members are in danger and that we can go about our business safely, but not in the other place.
  Mr. Kenneth Lewis: Following the remarks of the hon. and learned Member for Leicester, West (Mr. Janner), may I congratulate my right hon. Friend upon the massive amount of business that has so far been transacted in this place without the roof falling in, despite what happened along the corridor?
  Mr. St. John-Stevas: I am grateful to my hon. Friend for that unsolicited and undoubtedly deserved tribute.
  Mr. van Stranbenzee: In spite of next week being a busy one, will my right

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  hon. Friend find time for a debate on early-day motion 830?
  [That this House notes that the honourable Member for Wokingham stated in the House on 20th December 1979 ' When I had dealings with Mr. Tony Smythe, when I was proud to serve at the Northern Ireland Office and he was in the National Council for Civil Liberties, I had no doubts whatever that all his interests lay on the side of the Irish Republican Army'; also notes that this grossly defamatory accusation has been allowed to remain on the record for seven months; and calls upon the honourable Member to withdraw these words unreservedly or repeat them outside the House.]
  This would provide the House with a chance to judge the matters referred to in the motion, not by way of selective quotation but by considering the full sequence of events that culminated, my right hon. Friend may recall, in a public apology by Mr. Tony Smythe to my constituents for the ruthless way in which he defamed them at a time when they were unable to defend themselves.
  Mr. St. John-Stevas: I have seen the motion on the Order Paper. I appreciate the strong feelings that the motion has aroused, but I am afraid that I cannot find time for a debate next week.
  Mr. Speaker: Order. I propose to allow business questions to run until four o'clock. There are two statements to follow. I hope that hon. Members realise that they will decide whether their colleagues are called.
  Mr. Straw: Is the Leader of the House aware that owing to a mass defection of Conservative peers early this week the Government have been defeated five times on amendments to the Housing Bill? Do the Government intend to accept these amendments? When will the Bill come back to the House of Commons?
  Mr. St. John-Stevas: The Housing Bill will be coming back to the House with amendments before the recess. It will then be possible for the House to decide whether to accept or reject those amendments. It is true that the Government have been defeated five times in the House of Lords. That is no bad thing, necessarily. Is shows that we are a genuine bicameral legislature. The
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  Government have been defeated five times in the House of Lords but only four times this week in this place.
  Mr. Bruce-Gardyne: On Thursday's business, my right hon. Friend said that the House would be invited to approve the outstanding Votes, which involve additional public expenditure of about £230 million. Are we to have an opportunity to debate those Votes before being invited to vote upon them?
  Mr. St. John-Stevas: I have great sympathy with the point made by my hon. Friend and other hon. Members. It is clear that our machinery for examining Supply is totally unsatisfactroy. This matter should be discussed in detail and in depth by the Procedure Committee. I hope that it will be raised in the procedure debate and that, as a result, we can set in hand arrangements for a thorough overhaul of this highly unsatisfactory situation. That is the only way to deal with it. This is a problem of long standing. We need a carefully considered and radical solution, and I hope that will be the first step towards it.
  Mr. Christopher Price: May we have a debate next week on the decision, just over half an hour ago, by the Dorset county council, by 55 votes to 22, with 10 Tory defections, to abolish the school meals service altogether? Is that not the result of the disastrous Education (No. 2) Bill, which was put through earlier this year? Is this not a far more important matter for an immediate Government statement than Wednesday evening's business on the assisted places scheme? Why is there such a rush about the assisted places scheme when it is not to come in until late next year anyway?
  Mr. St. John-Stevas: The school meals service in Dorset is a matter for the local education authority to decide.
  Mr. Price: It is a national matter.
  Mr. St. John-Stevas: No. Under our constitution it is a matter for the local education authority to decide. It has control over its own expenditure. Whether we applaud or condemn it, it is a matter for the local education authority.
  It is extremely important that this House should have an opportunity to debate the assisted places regulations in good time, so that arrangements can be made for the autumn term.
  Viscount Cranborne: I am grateful for my right hon. Friend's reply and equally grateful for the interest taken by the hon. Member for Lewisham, West (Mr. Price) in matters appertaining to Dorset. Will my right hon. Friend find time before the recess for the House to debate the coming Russian offensive in Afghanistan and the daily atrocities being committed by the Soviet imperialists in that country?
  Mr. St. John-Stevas: I join my hon. Friend in utterly condemning the Soviet invasion of Afghanistan and the atrocities that are being committed there. I cannot promise an early debate, but should the situation in that country deteriorate further there would be an opportunity to reconsider what I have said.
  Mr. Arthur Lewis: The Leader of the House may be aware that some time ago there was the unfortunate death of a schoolteacher from the East End of London. As we know that the police did not cause his death, that his friends did not cause his death, and that we can assume that he did not hit himself on the head, may we have a Select Committee to go into all aspects of the matter? We are interested in what is happpening in Afghanistan, but surely we must be even more interested in knowing how that man met his death.
  Mr. St. John-Stevas: That matter has been raised from time to time in the House, and the hon. Gentleman recently tabled a motion about it. However, my right hon. Friend the Home Secretary has made it plain that he is satisfied with the investigations that have been carried out and that there is no need for a further inquiry.
  Mr. Budgen: In the debate on procedure will the Government bring forward immediate and specific proposals to change the ridiculous procedure by which the Supplementary Estimates go through the House on the nod?
  Mr. St. John-Stevas: In response to an earlier question I indicated that in that debate proposals will be put forward for remedying this situation. It is for the House to decide, but we cannot remedy it immediately. We must consider the matter in great detail, and every hon. Member will have a contribution to make on it I assure my hon. Friend that it
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  is my intention and determination to see that the wishes of the House in this matter are respected.
  Mr. Cryer: Will the Leader of the House find time before the recess for a debate on the White Paper on telephone interception, which has not been debated in the House but is frequently used as a reference? If so, we could also debate the question of Menwith Hill, Harrogate, and the interception of international telephone signals, which is apparently being carried out with the illegal connivance of the Post Office. If that is the case, surely it merits debate in the House.
  Mr. St. John-Stevas: It may merit debate, but many subjects merit debate for which I do not have time. As the hon. Gentleman knows, because he has taken a keen interest in this subject, this matter comes directly under the responsibility of my right hon. Friend the Home Secretary and it is not normal to answer questions on it in the House.
  Mr. Kinnock Mr. Kinnock rose—
  Mr. Speaker: Order. I shall call the Front Bench spokesman at the end. I want to devote the remaining few minutes to Back Benchers.
  Mr. Robert Atkins: Will my right hon. Friend bear in mind the amendment to early-day motion 796 in favour of Trident, which nearly 200 of his right hon. and hon. Friends have signed as opposed to a mere 153 Opposition Members?
  [That this House supports Her Majesty's Government's decision to replace Polaris with the Trident weapon system, believing that Great Britain's strategic nuclear deterrent has contributed substantially to peace in Europe for the last 35 years.]
  Does he agree that there is a need for an urgent debate on the decision to purchase the Trident weapon system?
  Mr. St. John-Stevas: I agree with the amendment to the motion, which I have seen, and the views expressed by my hon. Friend. The first duty of any Government is the defence of the country against external attack. The Trident system will be a major contribution to that end. It would not be unfitting in due course to have a debate on that subject, but perhaps we could have it

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  when the House returns rather than before the recess.
  Mr. Spearing: Is the Leader of the House aware that his right hon. Friend the Lord Privy Seal has declined to make any statement about forthcoming business at the EEC Council of Ministers' meeting in September and October on the ground that the agenda is too tentative? Will he look into this matter and ensure that we have proper parliamentary accountability from the Government in that rather ramshackle outfit?
  Mr. St. John-Stevas: I shall certainly draw that matter to the attention of my right hon. Friend the Lord Privy Seal, but he has to judge whether, in the light of all the circumstances, a statement is necessary. He has decided in this instance that it is not. However, I shall certainly draw the matter to his attention again.
  Mr. Adley: Is my right hon. Friend aware that the remarks about Dorset schools made by the hon. Member for Lewisham, West (Mr. Price) are not shared by my constituents, half of whom live in the county of Dorset? One of the few who have been in touch with me about the decisions of the county council described the situation succinctly by saying "I can feed my children, but I cannot teach them." Will my right hon. Friend ensure that this matter is left in the hands of the county council and confirm that there is no intention of the House debating and censuring individual county councils on their decisions?
  Mr. St. John-Stevas: That puts the case admirably. I entirely agree with my hon. Friend that this matter falls within the scope of local authority discretion. The local authority decides this matter. It has been given the freedom that has long been demanded under the Education Act.
  Mr. English: Perhaps unintentionally, the Leader of the House did not say when he wished the House of Commons to return after the recess. Does he agree that if the Procedure Committee is not set up in the next couple of weeks over two months will have been lost, during which that Committee could have been taking written evidence? Will the Leader of the House table the motions for the procedure debate next week so that we
  780
  all have an adequate opportunity to consider them?
  Mr. St. John-Stevas: I shall consider the hon. Gentleman's important representation. It has yet to be decided what motions, if any, are to be put down at the end of the debate. I did not say when the House would return because a final date has not yet been decided. However, I hope that it will be as late in October as possible.
  Several Hon. Members Several Hon. Members rose—
  Mr. Speaker: Order. There are only two Back-Bench Members still seeking to catch my eye and if they are quick I shall call them.
  Mr. Ioan Evans: Given the fact that there will be a motion of no confidence next Tuesday, will the Government put forward positive proposals for dealing with the problem of unemployment? Will the Leader of the House have a word with the Prime Minister, telling her that deep offence has been caused in Wales by her remark that people should go elsewhere to find jobs?
  Mr. St. John-Stevas: I well understand the feelings of the hon. Gentleman about unemployment in Wales, but I think that the remarks of the Prime Minister have been misinterpreted by the hon. Members. The Prime Minister was making a particular point about the mobility that is necessary. I clearly understand the sensitivity of Welsh Members on this matter. There will be an opportunity to raise the issue in the debate on Tuesday.
  Mr. Dubs: Will the Leader of the House find time before the recess for a debate on housing in London? Is he aware that every London Member can confirm that there is a worsening housing crisis in London, that homelessness is increasing, that waiting lists are increasing and that there is a decline in building? We need a debate on these issues.
  Mr. St. John-Stevas: There are housing problems in all parts of the country, and there have been for many years. I do not think that we can have a special debate on London on this matter but there will, no doubt, be opportunities to raise the issues when the Housing Bill returns from the other place.
  Mr. Kinnock: Recalling the question of my hon. Friend the Member for

  781
  Lewisham, West (Mr. Price), ignoring the sycophancy evident on the Government Back Benches, and acknowledging that Dorset county council is guilty of a disastrous desertion of its responsibility to children, if that question is one for local determination will the right hon. Gentleman tell me why his right hon. Friend the Secretary of State for Education and Science sent two civil servants to Dorset to try to pull Dorset county council into line?
  Mr. St. John-Stevas: I do not think that that is the purpose of whatever emissaries have gone from Elizabeth House. It is quite clear that the constitutional position is that local authorities have a responsibility for providing school meals. They have wanted that freedom for a long time. They have now obtained it, and it is up to them and not this House to determine how they use their powers.
  Mr. Jim Spicer: On a point of order, Mr. Speaker. Without wishing to be impertinent, I have sensed during business questions your impatience at the abuse of those questions by many hon. Members. That abuse has been demonstrated this afternoon in classic fashion by the hon. Member for Lewisham, West (Mr. Price) in seeking to interfere in matters that are of no concern to the House. I speak for myself—though I believe that I have the support of many of my hon.
  782
  Friends—when I say that you would have full support if you called a halt to such interference in future.
  Mr. Speaker: The hon. Gentleman is a Member for Dorset and the House always understands that if there is a reference to an hon. Member's constituency he is bound to take a very special interest in that reference.

  CONSOLIDATED FUND (APPROPRIATION) BILL
  Mr. Speaker: I have a short statement to make.
  For the debate on Monday 4 August on the Second Reading of the Consolidated Fund (Appropriation) Bill hon. Members may hand in to my office by 9 am on Thursday 31 July their names and the topic that they wish to raise. The ballot will be carried out as on the last occasion. An hon. Member may hand in only his or her own name and one topic. The debate will cover all the main Estimates originally presented for the current financial year in House of Commons Papers Nos. 469, 470 and 471 and the Supplementary and Revised Estimates presented since then in House of Commons Papers Nos. 643, 644 and 645.
  On Second Reading it will be in order to raise any topic falling within the compass of those Estimates.
  I shall put out the result of the ballot later on 31 July.

  EUROPEAN COMMUNITY (AGRICULTURE MINISTERS' MEETING)
  The Minister of Agriculture, Fisheries and Food (Mr. Peter Walker): With permission, Mr. Speaker, I wish to make a statement about the Council of Fisheries Ministers in Luxembourg on 21 July, at which I represented the United Kingdom, together with my right hon. Friend the Secretary of State for Scotland and my hon. Friend the Minister of State.
  I should also like to report on the Council of Agriculture Ministers meeting on 22 July at which I and my hon. Friend the Minister of State represented the United Kingdom.
  The Fisheries Council had a useful discussion of the principles for determining 1980 quota allocations between member States. The Commission had prepared a schedule of quota allocations which made it clear that these were not its proposals on quotas but were simply a schedule of quota allocations with a range of calculating methods which it had been considering.
  I questioned these methods and stressed the need for a fair distribution of catches to take into account the size of the resources found within our fisheries limits and the full extent of United Kingdom losses of fishing opportunities in third country waters. I urged the Commission to put forward proposals fully reflecting these factors and it was agreed that the council would undertake detailed discussion of quota proposals to be presented by the Commission at the October meeting of the Council.
  The Council also considered a Commission communications on access arrangements, where I made clear the Government's requirement for an adequate zone of exclusive access and for preferential arrangements beyond. These demands were supported by certain other member States.
  New proposals on structural measures were tabled at the Council but not discussed in substance, and there was a general exchange of views on the revised Commission proposals for a conservation regime. The Council agreed to a detailed examination of all outstanding problems connected with the conservation proposal at its next meeting on 29 September. A
  784
  further Council was planned for October, which will allow time for preparatory discussions to be completed on quotas, access and the structural proposals.
  At the Agriculture Council there was a short discussion upon the various programmes for structural aid. It was agreed that decisions on these proposals, including those for Northern Ireland and Scotland, would be taken at the October meeting of the Council.
  Mr. Gundelach reported to the Council on his successful negotiations with New Zealand on arrangements for the future import of New Zealand lamb into the Community. There has been total agreement between the Commission and the New Zealand Government other than on the issue of whether the existing tariff of 20 per cent. should be reduced to 10 or to 8 per cent.
  The Commission emphasised that the agreement reached was a satisfactory and fair one. Only the French Government raised major reservations. They opposed any reduction in the tariff below 15 per cent. and questioned other elements in the agreement. The British Government expressed the view that a reduction of the tariff to 8 per cent. was a reasonable request on the part of the New Zealand Government and we made clear our position that we would only support an agreement that was satisfactory to the New Zealand Government.
  We were supported vigorously both by the Commission and by many other nations in our demand that agreement should be swiftly reached and that it was essential that the sheepmeat regime came in at the earliest possible date. On the recommendation of the Commission and the Presidency, the Council agreed that all the internal and external aspects of the regime should be decided at its next meeting in September in order to permit its entry into force on 1 October 1980. The Commission expressed its confidence that it would reach the necessary agreement with third country suppliers in time for the Council to finalise arrangements at the next meeting.
  On access for New Zealand butter, Mr. Gundelach reported that New Zealand was prepared, under a gentleman's agreement, to reduce sendings to the United Kingdom by 20,000 tonnes in 1980, in return for an increase in her net

  785
  selling price to 75 per cent of the intervention price. Other members of the Council were prepared to accept this agreement, even though they thought the terms were generous to New Zealand. Since it was clear that the Council would not agree to better terms, and in the knowledge that they were acceptable to New Zealand, I agreed to them in advance of the debate tomorrow.
  Following a request that I made at the last Council meeting on the difficulties of the glasshouse sector, the Commission reported that it was initiating discussions with the Dutch Government under article 93 (1) of the Treaty on the preferential rate charged for natural gas in the Netherlands. I was supported by other countries in demanding that these talks should take place speedily and the Commission assured the Council of its recognition of the urgency of the problem.
  As a result of pressure from the United Kingdom for action against cheap offers from Poland, the Council agreed to a Commission proposal to introduce surveillance arrangements for strawberry pulp and frozen strawberries, thus equipping the Council with the ability to take quick action to deal with cheap imports which threatened the interests of our soft fruit producers.
  A discussion took place on problems connected with battery hens. The Council endorsed the Commission's intention to produce a report and proposals on this subject and agreed that the report should be discussed speedily after it had been received. The Council agreed to a suggestion made by the United Kingdom that research made on alternative methods of commercial egg production should be co-ordinated throughout the Community.
  Mr. Hardy: On a point of order, Mr. Speaker. Is it not outrageous to have a statement on fisheries and an extremely long statement on agriculture lumped together? Would it not have been better, more courteous to the House and more considerate to all hon. Members if the Minister had presented two separate statements? You are placed in an intolerable position. One hon. Member will be called to raise matters about the Antipodes and the next minute another hon. Member will be talking about the North Sea. It appears to me that there
  786
  is far too much variety for us at this time.
  Mr. Speaker: This is not the first time that we have had such a statement. It is not for me either to defend or to criticise it. We must deal with the statement that has been made.
  Mr. Mason: The House is obliged to the right hon. Member for his report. What does the blocking by the French of the new sheepmeat regime mean, first to the calculations on the farm price package, and, secondly, to the farmers who expected some financial assistance, which now appears to be delayed? It appears that the French have blocked this at least until October.
  Is the Minister intent on standing by the New Zealand Government's request for a 12 per cent. cut in the tariff on their lamb exports to the United Kingdom? That is what they want. He said that they had a veto over the sheepmeat regime, so will he continue to back them?
  On the question of butter, New Zealand's exports to the Common Market, which really means exports to the United Kingdom, will be cut by 20,000 tonnes. Although they are subject to less duty or a better price, does the Minister—as distinct from the EEC Commission-feel that the New Zealanders have got a fair deal, bearing in mind that this agreement is for one year only and that the Government have agreed to it prior to the debate tomorrow on New Zealand butter quotas?
  On the question of fish, we hope that the Minister will stand by unanimous agreement of the House on access and total allowable catch demands, and especially the fishing industry's demand for at least a 45 per cent. take of white fish species.
  Finally, is the Minister not aware that the fishing industry has been having a disastrous year? The deep sea fleet is rusting at the quayside, the inshore fleets are going on strike as a protest against subsidising cheap fish imports and the industry as a whole is in dire straits. It desperately needs help until a better deal on the common fisheries policy is forthcoming. What will the Minister do about that?
  Mr. Walker: The regulation on sheep-meat always included a clause that stated that it should come into effect at the same time as the agreement with third countries. The New Zealand negotiations have only just taken place, the Australian negotiations are taking place this week, and there are one or two other minor negotiations to come. The date of 1 October was not objected to by the French Government, therefore I believe that it is likely that the sheepmeat regime will come into being on that date.
  Prior to that, and in the interim, I have previously announced a lift in the guarantee price for the United Kingdom of 11 per cent. over last year's prices, which means that the guarantee over the last season, for which the Labour Government were responsible, is 22 per cent higher.
  On the question of support for the New Zealand Government of 8 per cent., we were alone in supporting that figure. I gather from a telegram that I received this morning that the New Zealand Prime Minister said at a press conference yesterday that 10 per cent. would be acceptable to the New Zealand Government. He was grateful to the British Government for arguing for the 8 per cent. position.
  On the question of butter, once again we were in close contact with the New Zealand Government, and the figure for the quota for the remaining part of the year is based on their sales to date this year, which have been lower than originally anticipated. Therefore, the improvement that the New Zealanders will now obtain by the lowering of the levy against them will enable them to have better sales than expected in the latter part of the year. As I made clear in my statement, New Zealand Government officials were present in Luxembourg and we were in close consultation with them throughout. It was their wish that we should agree to this arrangement.
  I come now to the question of fishing. One of the pleasing features of this meeting was that for the first time our views about access were not in a minority of eight to one. We had substantial support from a number of other countries. Of course, we adhere to the view that we have always held on that question. In terms of quotas we are in close touch with the industry and we made clear the
  788
  degree to which we wanted different proposals on quotas put forward at the next meeting. I hope that substantial improvement will take place.
  The right hon. Gentleman mentioned the condition of the fishing industry. The industry came to us for aid earlier in the year, and we gave the aid that was then requested. The Opposition supported that. At the end of June and the beginning of this month the industry came to us again, saying that the position had deteriorated still further. It agreed to present new figures to us, the last of which I received at the end of last week. The fishing industry knows that we are now urgently discussing those figures and I hope that it will judge our desire to help it in a difficult period on what we have already done this year.
  Mr. Donald Stewart: Is the Minister aware that the postponing of further discussions on fisheries until 29 September makes his previous commitment to an agreement on 1 January all the more dangerous? Will he give us an assurance that if by that time no satisfactory agreement has been made his commitment will go by the board, not the interests of our fishermen?
  Mr. Walker: I shall not allow the interests of our fishermen to go by the board. Like the right hon. Member, I consider fishing to be one of the most basic and vital industries in this country. The tone and the atmosphere of the meeting that we have just held was constructive. We discussed for the first time the major elements of access and quotas. The agreement that we should have a major meeting in October to deal with proposals from the Commission is an encouraging trend, not a discouraging one.
  Mrs. Kellett-Bowman: If my right hon. Friend is wrong in his belief that the sheepmeat regime will come into operation on 1 October, will he take immediate steps to adjust the United Kingdom guarantee price to the level promised under the common regime? Many sheep prices are so low that despite the good lamb drop it has been very difficult for sheep farmers to make an adequate living this year.
  Mr. Walker: I cannot guarantee that. I hope and believe that the regime will

  789
  come into being on 1 October, the Council having unanimously agreed to that date and France being alone in its opposition to the New Zealand agreement. I repeat that I did not know whether there would be a sheepmeat regime earlier in the year, so I announced a substantial lift in the guarantee prices. These are 11 per cent. above last year, which in turn were 10 per cent. above the year before. There has been much better lambing this year than the previous year, and by giving an 11 per cent. increase in the guarantee price we have shown our determination to support the British sheepmeat industry.
  Mr. J. Enoch Powell: Did the Minister notice the persistent reference in reports from Brussels on proceedings of the Fisheries Council to "a package deal "on the budget arrangements? In view of the Prime Minister's firm repudiation of any such linkage, will the right hon. Gentleman make it clear that those budget arrangements will come into force punctually, irrespective of whatever arrangement is made on fisheries, or whether an arrangement is made at all?
  Mr. Walker: Yes. As one who was present at the Brussels meeting, I can confirm that there was no mention of any linkage with the budget deal by any country. The Government treat it as a separate subject.
  Mr. Wall: I congratulate my right hon. Friend on once again standing up for the rights of British fishermen. Is he aware that because of the further delay in the settlement of the common fisheries policy the industry cannot survive without further and immediate Government help? Will he make a statement as soon as possible before the recess?
  Mr. Walker: I can only repeat that when the industry came to us for help for the period March to September we agreed to provide help along the lines of the terms that it suggested. I appreciate that events since then have been different from those which the industry anticipated. We asked the industry for more details. It collaborated with us and gave us more facts and details. We are giving the matter urgent consideration, and I shall make a statement at the earliest opportunity.
  Mr. Stephen Ross: Because the fishing talks are to continue, I echo the requests put forward by hon. Members that immediate financial aid should be given to the industry. I congratulate the Minister on standing firm over New Zealand exports of lamb to Europe.
  I deal next with horticulture. I think that the Minister will agree that his statement will disappoint the glasshouse growers in my constituency, who cannot continue operating much longer. It is monstrous to suggest that we must return to the Dutch for further discussions. What is the time scale? Is the Minister aware that speed is of the essence? Redundancies are already taking place because, having looked at future plantings, growers are giving up the ghost.
  Mr. Walker: I recognise the anxiety in the industry, which I share. As to the advantage held by the Dutch in the cost of energy supplies, the Commission has, in fairness, taken the only action that it can, which is to use an article in the Treaty to demand detailed information and the right of access to information so that it can ascertain the details of the problem. The Commission has guaranteed that it will do that urgently. My Danish, German and Belgian colleagues join me in saying that their glasshouse industries were suffering heavily because of unfair competition. I hope that the Commission will act quickly.
  Mr. Colin Shepherd: Further to my right hon. Friend's response to my hon. Friend the Member for Lancaster (Mrs. Kellett-Bowman), may I ask whether he is aware that his confidence that the French will not renege on their agreement will not be shared by British sheepmeat producers? What contingency plans has he in mind should the French so renege?
  Mr. Walker: I am not prepared to say that we are considering contingency planning for a regime to which the whole Community agreed in May. Every member country and the Commission, with the exception of a query from France, agreed at the last meeting. The Council agreed that the regime would come into effect on 1 October. I am sure that my hon. Friend will understand that if I said that we were considering a contingency programme it would indicate

  791
  that we thought it reasonable for a Government to take an action that would affect sheep producers throughout the Community—certainly Holland, Germany and elsewhere—while that Government continued to pursue illegal actions.
  Mr. James Johnson: Will the Minister confirm that during the negotiations Britain was offered about 31 per cent. in demersal stocks and 38 per cent. in pelagic stocks? Even if the French behave like gentlemen, which is dubious, does the right hon. Gentleman think that he will receive better offers in his October negotiations? The British fishing industry is almost on its last legs. It asked him for £35 million for the next six months to continue operating. Will he light like a tiger shark inside the Cabinet to obtain that money? He has all-party support for that aim, as well as all-party support against people on the Continent.
  Mr. Walker: I expect, and will argue for, better quotas. The hon. Gentleman has considerable knowledge of fishing. He knows that broad figures covering the totality of the stock give a false impression, because certain stocks are more vulnerable than others. Certain stocks of fish have greater priority for the British fishing industry. We are close to the industry on the question of priorities for improvement of our quotas, and we shall work on that basis. I repeat that the Government responded generously to the first request this year for aid. The second request for aid has only recently been put forward in its completed form, and we are examining it urgently.
  Mr. Speaker: I appeal to the House for short questions and answers because there is another statement to follow and I wish to call as many hon. Members as I can.
  Mr. Peter Mills: Will my right hon. Friend take note that there will be real anger and loss of confidence in the sheep world because of the latest trick by the French Government to delay the exports of our produce to France? Will he bear in mind that the autumn sales will be affected? With great respect to him and to the other Council Ministers, something must be done before 1 October. Why cannot they return to the conference table and take action before that date to save the industry?
  Mr. Walker: The date has always depended upon the dates on which negotiations with third countries are completed, which is in the hands of the Commission. Although we can cope with the administrative problems of an earlier date, other countries cannot. If the regime is introduced on 1 October, it will affect prices advantageously both before and after that date. Because of the uncertainty whether the regime would be completed, would be introduced at all, or would even be negotiated at all, I have announced substantial increases in the guarantee prices which are 22 per cent. above their level two years ago.
  Mr. Robert Hughes: Will the Minister admit that there was no progress towards reaching an agreement at the last Fisheries Council meeting? Is he aware that the fishing industry—especially the small ports, which have borne the long-drawn-out negotiations with Considerable dignity and considerable trust in both Governments—is at its wit's end? The action taking place in the North-East of Scotland and elsewhere this week is a measure of the despair and hysteria in the industry. The only way in which the right hon. Gentleman can give some confidence to the industry is to announce next week—not later, because the industry cannot wait—that there will be immediate short-term aid for the industry.
  Mr. Walker: I disagree with the hon. Gentleman's first point. Important progress was made at the meeting. I do not wish to make a party point, but until a year ago the position was that eight countries had agreed to a fishing policy that was unsatisfactory for Britain. It was important to shift them away from that agreement and to look more objectively at our position. The Council meeting showed that that had been achieved. I hope that the October meeting, which will be crucial, will make important progress for the fishing industry.
  The Scottish fishermen recently sailed back into port, and I understand their disappointment over the prices of fish this week. I am pleased that the Scottish Fishermen's Federation has advised the fleet to return to sea. Because of the way in which we considered the industry's first application for aid, it knows that we will genuinely consider its current problems.
  Sir Walter Clegg: Is my right hon. Friend aware that in Fleetwood two more medium trawlers have tied up, which makes the best part of our medium trawler fleet tied up and out of action? Unless help is forthcoming quickly there will be no fleet by the time my right hon. Friend reaches the negotiations.
  Mr. Walker: I understand the problem and also the effect that price of fish in Britain, combined with increased costs, have had on the fishing industry during the year. My hon. Friend knows that we met the fishermen from Fleetwood, as we met fishermen from other ports. The package that we announced in March was designed to meet their application for aid from March to September. I know that the position has deteriorated since then, and I assure my hon. Friend that we are giving urgent attention to the facts and figures that have been given to us.
  Mr. Jay: Is the Minister aware that the Norwegian fishing industry is benefiting greatly from a 200-mile exclusive fishing zone?
  Mr. Walker: I am not the spokesman for the Norwegian fishing industry. I have not studied how well or how badly it is doing.
  Mr. Sproat: Was the question of cheap foreign imports of fish discussed at the meeting? Will my right hon. Friend continue to make it clear to our EEC partners that however much the fish quota percentages may be juggled, whether globally or by species, there is no way in which we can accept less than 40 per cent., when we put in more than 60 per cent.?
  Mr. Walker: My hon. Friend used the word "juggle" with regard to the percentage of quotas. In fact, to have a 40 per cent. quota which consisted of a whole range of fish which were used primarily for making fertilisers and so on would not be particularly attractive. The important thing—which is what we are doing with the industry—is to discuss not an overall percentage aim but, rather, stock by stock, what is required for the industry. We shall obviously endeavour to obtain the best quotas possible. As to imports, I think that my hon. Friend knows that as a result of the representations of the United Kingdom Government the tariff against third country imports
  794
  into the Community have been increased to the maximum allowed by the GATT.
  Mr. Austin Mitchell: Will the right hon. Gentleman accept the industry's case for £70 million worth of aid a year and for a limitation on imports, which it requires if it is to survive in order to inherit the settlement? Secondly, as part of that settlement, will he bear in mind the need for an increase in mesh sizes, harmonisation of aids and subsidies throughout the Common Market and a limitation on, and registration of, foreign effort in British preferential waters if we are to have any control at all, because the quotas are a particularly useless form of policing effort in those waters?
  Mr. Walker: Whatever regime is introduced, it is important that a proper system of control should be in force throughout the Community. As to the application for £35 million worth of aid for a half year, I can only state what I have constantly repeated to the House—that we are examining the detail of that application. Until we have done so, and until we have decided how we shall help, I cannot make an announcement. As to the harmonisation of aid, we are at present giving a total of £24 million to the fishing industry which is a higher volume of aid than in some other Community countries. If we added a further £70 million on top of that, which the hon. Gentleman is advocating, harmonisation would do considerable damage to the British fishing position.
  Miss Fookes: Will my right hon. Friend take on board my warm welcome for his references to the welfare of battery hens? Can he give any details of the research that will be undertaken into alternative and more humane methods of egg production?
  Mr. Walker: We have decided to increase the research programme that we are carrying out at one of the Ministry's husbandry farms. The German Government are just completing a research programme. One of the results of the Council meeting was the agreement that the Commission should co-ordinate research throughout the Community to see what progress could be made.
  Mr. Hugh D. Brown: I recognise that progress has been made on sheep, but, as a market man himself, if the right hon.

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  Gentleman were buying lambs in the first sales in Scotland in two weeks' time, would he be prepared to offer reasonably high prices?
  Mr. Walker: Yes.
  Mr. Pollock: Does my right hon. Friend accept that during the current crisis in the industry, and pending settlement of a common fisheries policy, it is vital for the industry, Parliament and the Government to present a united front in order to be an effective negotiating force in Europe? To indicate the Government's good faith to the industry, will my right hon. Friend heed the urgings from both sides of the House for an early response to the request for aid?
  Mr. Walker: Yes.
  Mr. Dalyell: This is more than just a question of ethyl alcohol. It concerns the dire plight of the Scottish glasshouse industry, where growers, such as Peter Easton, have made complaints for the first time in their lives. Are not the Dutch Government at the Hague the most efficient Government in the world? Is it not preposterous that they cannot let their colleagues know exactly what is going on in relation to preferential natural gas prices? Of course they know. Are they not openly flouting Common Market rules—the very people who lecture us all on how to keep the rules?
  Mr. Walker: They argue that they are not selling subsidised fuel, but that they are merely providing fuel at a commercial rate to their glasshouse industry. They are using the advantage of having cheap energy for that purpose. So far as I know, there is no form of subsidy on that gas. They are just not charging the equivalent oil price. I think that it is true to say that there is no direct subsidy, but, unlike all the other countries in the Community, they are not charging the oil equivalent price for their energy. It is the demand that they bring it up to the oil equivalent price that is the important factor. The Commission has used its powers under the Treaty to obtain the information. I recognise that unlss urgent action is taken, real harm will be done to our glasshouse industry in Scotland and elsewhere.
  Several Hon. Members Several Hon. Members rose—
  Mr. Speaker: Order. I appeal to the House. I shall not be able to call other hon. Members if questions and answers are too long. I was hoping to call all those hon. Members who have risen, because I know that most of them have a constituency interest, and I always try to call them in those circumstances.
  Mr. Peter Fraser: I recognise the success that my right hon. Friend has announced in his stattement relating to the import of strawberry pulp from non-EEC countries, but does he recognise that a similar crisis is looming in relation to raspberries and the import of pulp from the same countries? Will he initiate the same sort of action within the EEC as he did with regard to strawberries?
  Mr. Walker: Yes.
  Mr. Spearing: Will the arrangement for New Zealand butter solve the problems which the right hon. Gentleman outlined in a written answer to me? As we are debating New Zealand butter tomorrow, why did the Minister not agree ad referendum?
  Mr. Walker: I think that the hon. Gentleman will share my view that what we did earlier this week was in the interests of the New Zealand Government. As quite a lot of hostility was expressed to the generosity of the terms, and as I had available to me terms which the New Zealand Government representative considered that I should accept, I think that, on reflection, the hon. Gentleman will agree that it would have been wrong had I left the position uncertain until a later time when other countries could come back and object. I did what I did in the interests of the New Zealand Government. This year's settlement is one which the New Zealand Government consider favourable to their position. However, the point raised in my written reply is of much greater importance with regard to the allocation of New Zealand butter in 1981 and onwards.
  Mr. Myles: In view of what my hon. Friend the Member for Moray and Nairn (Mr. Pollock) said about Ministers and the industry working together, will my right hon. Friend advise the industry that it should pay attention to its elected leaders and pay no attention to din-raisers, such as Jim Sillars, who are trying to stir up trouble in the industry?
  Mr. Walker: I know that the leaders of the Scottish fishing industry have been extremely diligent in advocating what they consider to be necessary for the Scottish fishermen. In their many talks with the Government, both in Brussels and in London, no group of men could have done more to put the case for the industry. Having heard their fierce and tough representations, I believe that they are generally trying to represent the industry. I very much hope that the industry will take their advice to go back to sea this weekend, because the action that will otherwise be taken will be of no help to them or their case, which is not a case against the Government but one in respect of which the Government share their feelings.
  Mr. John Home Robertson: Will the right hon. Gentleman undertake to monitor prices at store sheep sales during September? If evidence emerges that hill farmers are not getting their fair share of the returns from the coming European sheepmeat regime, will he be prepared to make national funds available to assist them during the winter?
  Mr. Walker: As the hon. Gentleman knows, we review the hill farm subsidies on the basis of what has happened during the past year. As to the comparison with last year, I think that the hon. Gentleman knows that during the main period of sales the guarantee operated throughout last year. If that is the case this year, the guarantee will be 11 per cent. higher.
  Mr. John MacKay: Does my right hon. Friend realise that if he comes to Oban as a buyer, I and my hill farmers reckon that he will be the only confident buyer there? We do not place very much store on the French promise of a settlement on 1 October. Will my right hon. Friend seriously consider the request by some of my hon. Friends for an interim United Kingdom arrangement to tide us over until that agreement? If that agreement occurs on 1 October, the interim agreement will operate for a very short time, but it will at least give confidence.
  Mr. Walker: Prior to this situation we decided to lift the guarantee by 11 per cent. against last year, which in turn had been raised by 10 per cent. above the year before. The guaranteed price is 22 per cent. above what it was two
  798
  years ago. That was prior to any possible addition of benefit that the sheepmeat regime would give. In this period we have had one of the record lambing seasons of all time. There are plenty of lambs about. The increased guarantee will, I hope, help the industry considerably.
  Mr. Maclennan: Does the Minister realise that the action taken this week by the Scottish fishermen was a distress signal and a warning that he cannot rely on the patience of the industry indefinitely? When will he make an announcement about the aid for which the Government have been asked? Will it be before the House rises for the Summer Recess?
  Mr. Walker: In terms of the patience of the industry, I can only say that when it came to us originally the industry duly recorded that we acted speedily and effectively. We are acting speedily on its application, the figures of which we received only at the end of last week.
  Viscount Cranborne: Will my right hon. Friend give an assurance that he will continue to protect the interests of the inshore fishing industry, which employs many people in my constituency, and that, in particular, he will protect the position of the sea fisheries districts?
  Mr. Walker: To the inshore fishermen, the most important point is the exclusive zone. I was much encouraged by the much more generous attitude towards that than there had ever been before. Certainly we shall do that.
  Mr. Hardy: Is it not clear that the determined and increasing national support for various agricultural and horticultural activities means that over the next three or four years we shall produce a smaller share of the food that we need from our own resources? Can we expect a more vigorous response from the British Government? When will the Council of Ministers seriously consider the developing cereal surplus, which has important implications?
  Mr. Walker: As to food production, we have had two record cereal crops. Our sugar beet quota is at a high level. Our sheep production is likely to be stimulated. I hope that in the coming years we shall produce more food from

  799
  our own resources. The cereal surplus is variable in relation to world demand. I should prefer to have a surplus of cereals, which could be used and disposed of, to a surplus of many other products, such as dairy products, which we have at present.
  Mr. Body: What advice can my right hon. Friend give to glasshouse growers in my constituency and elsewhere who have already made their employees redundant, and who will be out of business before October?
  Mr. Walker: I hope that the Commission will act quickly now that it has taken powers under the Treaty
  Mr. Wm. Ross: Was there any discussion on structural aids for Scotland and Northern Ireland? Can the Minister indicate what structure he is aiming at for the pig and poultry industries in Northern Ireland? Will he indicate the size that he wishes those industries to be in future? Did he seek clearance for any national aids on the ground that this is a depressed area?
  Mr. Walker: The hon. Gentleman will understand that to answer those questions will result in a long statement of detail. If I may, I shall write to the hon. Gentleman giving him the detail of what has happened so far and the various alternatives that are available to us.
  Mr. Nicholas Baker: Will my right hon. Friend deploy his usual energy to per-
  800
  suade the EEC Commission to do what it said it should do and restore the balance in the Community egg production industry, as the United Kingdom egg production industry is in a state of decline?
  Mr. Walker: Yes, I recognise the problem. It is one that is shared by a number of European countries at present. The problem is being examined by the Commision in relation to third-country imports.
  Mr. Strang: Does the Minister under-sand that the fishing industry is on the verge of collapse? Is he aware that the desperate decision by the fishermen of North-East Scotland collectively to cease fishing is escalating to other ports, and that the hardship of such action will extend wel beyond the men who go to sea? Does he recognise that unless the Government announce further temporary aid of at least £35 million before the recess, the industry will not survive on a sufficient scale to take advantage of any deal that he negotiates in Brussels?
  Mr. Walker: It is extraordinary that the hon. Gentleman should talk about the extension of the action of the fishermen of North-East Scotland when only yesterday their leaders urged them to go back to sea. Therefore, I hope that the hon. Gentleman will support the leaders of that industry in the advice that they gave to it. The last time that there was an application for aid we considered it objectively and acted quickly. Certainly we are considering this application just as objectively.

  NEW HEBRIDES
  The Minister of State, Foreign and Commonwealth Office (Mr. Peter Blaker): With your permision, Mr. Speaker, I shall make a statement about the New Hebrides.
  As the House is aware, it has always been the objective of Britain and France to ensure that the New Hebrides condominium should acieve independence in peace and unity.
  When I met my French colleague in Paris on Saturday 19 July, we agreed that independence should take place as planned on 30 July. We also recognised with regret that our efforts to achieve a negotiated solution to the problems that have resulted from the activities of Mr. Jimmy Stevens and his associates on the island of Santo had not so far been successful.
  We therefore agreed that while our two personal representatives should return to the New Hebrides to continue their efforts to establish a real dialogue between the Government and the various opposition groups we could not allow the secessionists to continue blatantly to flout the authority of the legitimate Government on the island of Santo.
  As a consequence of this decision, during the course of this morning, local time, British and French troops, acting together, carried out an operation to restore the authority of the legitimate Government on the island of Santo, thus putting an end to the eight-week rebellion. The operation appears so far to have been a complete success. There have been no casualties, and no shots were fired. I should like to congratulate the British and French troops on the efficiency with which this successful operation has been carried out.
  The way is now open for the central Government's representative to return to Santo and for the blockade to be lifted. A fresh attempt will now be made to reopen a dialogue to try to resolve outstanding difficulties before independence on 30 July. In this way we and the French Government have sought to fulfil our obligation to bring the New Hebrides to independence in peace and unity.
  Mrs. Dunwoody: The House will be impressed by the efficiency and speed
  802
  with which this operation was carried out. However, the Minister seems not to have kept us quite as well informed as some other parts of the Establishment. For example, is it true that the French commissioner went in ahead of the troops and cleared the way? If so, where is Mr. Jimmy Stevens? How many of the secessionists are likely to be charged, and are at present in custody? How long are British troops to remain on the island? Above all, how much aid will be available to the New Hebrides Government after the country becomes independent? It is all very well for the member States which have so far held responsibility to say "We shall hand over to you in peace and unity" but it is no use if they are not prepared to put up a positive aid programme, backed not just by one member of the condominium but by both, and by a sufficient amount of money and a sufficient guarantee of territorial integrity to allow the independent Government to continue.
  Mr. Blaker: I really must say that I find the carping tone of the hon. Lady absolutely astonishing. It is entirely in line with the hectoring manner that she has adopted all the way through this episode. She should have gone along the corridor and talked to her right hon. and noble Friend Lord Goronwy-Roberts, who speaks for her party in the other place, who knows the New Hebrides, in contrast to the hon. Lady, and who has consistently supported the Government.
  It is true that the French resident commissioner was sent to Santo 12 hours or so in advance of the arrival of the troops to inform the French settlers there of what was intended, so as to reduce the number of casualties. That was a successful operation. It was the right thing to do.
  I do not know where Mr. Stevens is. There are conflicting reports. According to my information, his whereabouts are not known, although I have seen it reported in the newspapers that he was at the airport. I very much hope that Mr. Stevens will now be prepared to co-operate in negotiations with the New Hebrides Government. I do not think that this is a matter for levity. There has been a successful operation. The problems of the New Hebrides are serious for the people of the New Hebrides, even

  803
  if the Opposition do not regard them in that way.
  I understand that it is not intended to charge the rebels but to negotiate with them so as to reach an agreed solution to the outstanding problems. In my opinion, that would be very much in the interests of the people of the New Hebrides.
  We do not intend that our troops should stay for long. If the New Hebrides Government should wish them to stay after independence day, next Wednesday, we shall be prepared to consider that request.
  We have made an offer of aid to Father Lini's Government. I shall not give the House the details at the moment because the matter is still under discussion, but, given our resources, I regard the offer as generous.
  Mrs. Dunwoody: The Minister has not answered the question. We have heard a lot about his ego; we have not heard much information. I asked him specifically what was the French Government's attitude towards aid. Is it their intention to agree to an aid package? If so, why is that not clear?
  We all congratulate the French Government, who seem to have handled their end of the arrangements very well.
  Mr. Blaker: I am struck by the fact that the hon. Lady should now congratulate the French. That is rather a change from the attitude that she displayed on previous occasions. It is not for me to answer for the French Government concerning their aid offer, but I understand that they intend to make an offer and have already had preliminary discussions with the New Hebrides Government.
  Several Hon. Members Several Hon. Members rose—
  Mr. Speaker: Order. I propose to call those hon. Members who rose immediately after the statement.
  Mr. Paul Dean: In contrast to the sour attitude of the hon. Member for Crewe (Mrs. Dunwoody), may I ask my hon. Friend to accept congratulations on the quiet and patient manner in which he has conducted very difficult negotiations, in the highest traditions of British diplomacy? Will he also convey the congratulations of the whole House—
  804
  with the exception of the hon. Lady—to our diplomats on the ground, to the Armed Forces, and to all others who have been involved in a very difficult period?
  Is my hon. Friend able to give any further indication to the House about the topics that remain for negotiation and the prospects of reaching agreement on them before independence?
  Mr. Blaker: I am grateful to my hon. Friend. It has been a difficult diplomatic negotiation, because five different parties have been involved. I shall transmit his congratulations to the diplomatic people and to the troops who have been concerned.
  I take some encouragement from the fact that in spite of the defence cuts made by the previous Labour Government our troops are still able to conduct an efficient military operation 12,000 miles from home.
  There are still three or four topics remaining for negotiation. The main one is the devolution of power to the regional assemblies. Father Lini has made a generous offer on that subject. We now wait to see whether Mr. Stevens is willing to respond in the same spirit.
  Mr. Ogden: Will the hon. Gentleman please try to find out where Mr. Jimmy Stevens is? There is usually enough trouble when his whereabouts are known. He is not a character who can be easily missed.
  We should like to be able to congratulate the hon. Gentleman on the success that he undoubtedly had in getting Anglo-French co-operation moving again. Does he agree that the critical attention that he has had from this House and from other Commonwealth Governments helped rather than hindered him in his negotiations with the French? Is he aware that there is some doubt about the price that the new Government of the New Hebrides may have been persuaded—or may yet be persuaded—to pay for Anglo-French co-operation?
  Mr. Blaker: We shall hope to learn soon where Mr. Stevens is. It is very much up to him to come forward, and we hope that he will be prepared to negotiate.
  I do not think that the criticisms made in the House have been helpful. The tone adopted by the hon. Member for Crewe

  805
  (Mrs. Dunwoody) has fallen below the level that we would have expected in a matter concerning Britain's national interests.
  As to the price—as the hon. Member for Liverpool, West Derby (Mr. Ogden) described it—that the New Hebrides Government are being asked to pay, I emphasise that they are not being asked to change the constitution. Both the French and British Governments have made it clear that they uphold the duly elected Government and constitution. No change is intended in the constitution. Father Lini has put forward some suggestions that I regard as generous, and I hope that Mr. Stevens will now respond.
  Sir Anthony Meyer: Is my hon. Friend aware that this very successful outcome is due in no way to the captious and irresponsible attitude of the Opposition, in particular of the hon. Member for Crewe (Mrs. Dunwoody), but to his own persistence and quiet determination, and that he is to be congratulated on having removed this irritant to Anglo-French relations?
  Will my hon. Friend give an assurance—in view of the evident wish of the Opposition to continue to foment trouble—that the declared intention of the New Hebrides Government to join the Commonwealth will not prevent them from having a special relationship with France, should they so wish?
  Mr. Blaker: I am grateful to my hon. Friend for his remarks. I am sure that it was right to seek the maximum Anglo-French co-operation, if only in the interests of the people of the New Hebrides, many of whom speak French and many of whom are descended from French people. There is always the question of future co-operation between France and Britain in the granting of aid, and that is important.
  The Parliament of the New Hebrides has already passed a resolution indicating the wish of the New Hebrides to join the Commonwealth, and I have no doubt that Commonwealth countries will be very glad to receive the New Hebrides immediately after independence. The New Hebrides is in the unusual position of being able to join the French-speaking Association, and I expect it also to apply to join that body.
  Mr. Roper: Will the hon. Gentleman make sure that the House is given further information on the developing position in the next few days? While Jimmy Stevens is still roaming, the trouble has not yet necessarily ended.
  Will the hon. Gentleman also take to the people, the Parliament and the Government of the New Hebrides the good wishes of, I believe, all parts of the House on their independence next week? Will he also pass on those congratulations to the Royal Marines and the Royal Air Force on the part that they have played in ensuring that that independence is as successful as it will be?
  Finally, will the hon. Gentleman put informal pressure on his French colleague to make sure that the very important offer of French educational aid is sorted out before independence next week?
  Mr. Blaker: I have no doubt that the French Government will be prepared to come forward soon with the aid offer that the hon. Gentleman has rightly described as generous.
  I shall transmit to my right hon. Friend the Secretary of State the hon. Gentleman's request that the House be given further information. I shall be leaving on Saturday for the independence celebrations.
  I do not think that we should get too excited about the whereabouts of Mr Stevens. Independence will be going ahead on Wednesday regardless of what Mr. Stevens does, and that is a reassurance for the people of the New Hebrides.
  I shall gladly pass on the hon. Gentleman's congratulations to the armed forces.
  Mr. Christopher Price: Is the hon. Gentleman aware that some of us believe that he and the other members of the Government concerned deserve credit for creating one of the very few genuine Anglo-French actions in the New Hebrides to have taken place over the years, and in succeeding, so far, reasonably well without shots being fired?
  Is the hon. Gentleman further aware that four or five days is a very short period in which to enter into discussions and get agreement on the issues which created the present position? Does he believe that co-existence is possible between the present Administration in the

  807
  New Hebrides and Jimmy Stevens? Finally, will he comment on discussions with the Papua New Guinea Government concerning an arrangement under which PNG troops might be brought in to stabilise a situation?
  Mr. Blaker: I am glad that the hon. Gentleman welcomes this example of Anglo-French co-operation in the New Hebrides. As I said before, a condominium is not the easiest system to run. I am sorry that a representative of the Liberal Party is not in the Chamber, as it was the Liberal Party in 1914 that set up the present arrangements. If it were starting again, it might think of proceeding in some other way.
  I agree that it is not long between now and independence. However, in my view it is possible for an agreement to be reached if the will is present on the part of Jimmy Stevens. The issues remaining to be settled have been fully discussed and they are well known to the parties. If the will is there, an agreement can be reached in not five days but two.
  I have read reports on the willingness of Papua New Guinea to provide assistance to the Government of the New Hebrides after independence. It is up to that Government after independence to decide what help they wish to call on, if any, from their neighbours. We hope that it will be possible to resolve the problem before that time and that such assistance will not be necessary.
  Mr. Dalyell: Will the Minister accept that our ribaldry of 10 minutes ago was not because we do not regard the situation in the New Hebrides as serious? Some of us have tabled private notice questions and done heaven knows what else on this subject. Is it really suggested that Jimmy Stevens might be in the airport? The airport is not exactly Heathrow. It would not be difficult to find him if he were there.
  Some of us think it a matter of importance that soon after Wednesday the troops should be brought home. They might become entangled in the New Hebrides and their stay might be many months or even years if they do not come out quickly and cleanly. Once troops remain in such a place it becomes increasingly difficult to get them out.
  Mr. Blaker: I recognise that the hon. Gentleman has consistently been con-
  808
  cerned about the possible use of troops. When we last discussed the matter he was concerned that their use in landing on Santo might lead to casualties. Fortunately, that turned out to be an unnecessary fear. I understand what the hon. Gentleman is saying about the possibility of our troops remaining for a long time if they remain after independence at the request of the New Hebrides Government. That is not our intention. However, we are prepared, if requested, to keep the troops there for a short time in the interests of a settlement and in the interests of helping the New Hebrides Government.

  MR. TONY SMYTHE
  Mr. Ennals: On a point of order, Mr. Speaker. I am sorry to raise a point of order after we have had the Business Statement and two other statements. Speaking in the House on 20 December 1979, the hon. Member for Wokingham (Mr. van Straubenzee) said:
  "When I had dealings with Mr. Tony Smythe, when I was proud to serve at the Northern Ireland Office and he was in the National Council for Civil Liberties, I had no doubt whatever that all his interests lay on the side of the Irish Republican Army."— [Official Report, 20 December 1979; Vol. 976, c. 1055-56.]
  That statement was grossly defamatory at the time that it was made. In spite of exchanges in the House, this statement, so damaging to the personal reputation of Mr. Smythe, has never been withdrawn by the hon. Gentleman, nor has he responded to repeated challenges to repeat the statement outside the House.
  I am raising this point of order on behalf of Mr. Smythe, who is unable to defend himself because the allegations were made under the protection of parliamentary privilege. Mr. Smythe's Member of Parliament, the hon. Member for Hornsey (Mr. Rossi), is the Minister of State, Northern Ireland Office. The hon. Gentleman specifically and in writing has authorised me to raise this issue on be-half of his constituent.
  It is not my intention to raise any of the other accusations made against Mr. Smythe and the organisation of which he is the director. I am concerned only to obtain justice and to protect the rights and clear the reputation of a man who has made a considerable contribution to

  809
  human rights and liberties in Britain. I am not seeking to challenge the principle of the privilege of hon. Members.
  Statements impugning the honour and integrity of an individual that have been proved by the evidence to be patently untrue are an infringement of hon. Members' vital privilege. I would no more than you, Mr. Speaker, in your ruling of 23 June, seek to take away the privilege of hon. Members. You rightly ruled, Mr. Speaker:
  "Every hon. Member must take full… responsibility for any statement that he makes in this House."— [Official Report, 23 June 1980; Vol. 987, c. 28.]
  As every right hon. and hon. Member argued on 23 June, the privileges that we hold will be brought into disrepute if damaging and defamatory allegations are made against individuals that are disproved by those in a position to know and are subsequently not withdrawn openly and publicly in the House. None of us needs to be reminded of a recent example in which one of our colleagues acted in precisely that way to clear the name of an individual against whom he had made an allegation.
  My purpose in raising this point of order is to ask whether the hon. Member for Wokingham, who knew, as you did, Mr. Speaker, that I proposed to raise this point of order, has sought from you an opportunity to make a personal statement of withdrawal to end this long drawn-out and unsavoury issue which has done and is doing damage to not only the individual abused but to the integrity of the House and the privileges that we claim for ourselves.
  Mr. Speaker: I listened with care to the right hon. Member for Norwich, North (Mr. Ennals), as I did recently when a similar application was made to me. I have received no request from anyone to make a statement, but the House will know that the hon. Member for Wokingham (Mr. van Straubenzee) asked this afternoon during business questions that the matter be debated next week. I have received no statement.

  FISHING INDUSTRY
  Mr. Maclennan: I beg to ask leave to move the Adjournment of the House, under Standing Order No. 9, for the purpose of discussing a specific and important matter that should have urgent consideration, namely,
  "The continuing deep depression of quay prices for fish, the hardship created for the industry by the Government's failure to respond to its predicament and the urgent need for substantial financial assistance if the industry is to survive."
  This afternoon we had a statement that has covered some of the matters that should be the subject of urgent debate in the House. It is in the light of the statement that I think it right to put submissions to you, Mr. Speaker, for your consideration. In the normal course of events, I should have chosen to give you greater notice of my intention to raise this issue under Standing Order No. 9. As the issue arose from the statement, you will appreciate, Mr. Speaker, that it was not possible for me to give you prior notice of my intention.
  That the matter is specific I have doubt that you will agree, Mr. Speaker, in the light of the exchanges that have taken place. The industry's predicament has been drawn sharply to the attention of everyone by the action of many members of the Scottish fishing fleet in not sailing this week. That it is of major importance was stressed by almost every hon. Member who spoke on the statement this afternoon. The only real issue is whether it should have the urgent consideration of the House under Standing Order No. 9 procedures.
  This is precisely the sort of issue where that procedure is appropriate. During the statement on the business for next week and on the business for the remainder of the Session, the Leader of the House indicated in a clear answer that there would be no time for a further debate on the fishing industry before Parliament rises for the Summer Recess. Equally, he indicated that the House would probably not reconvene much before the end of October. As there will be a long lapse of time, and as the industry's predicament requires urgent attention, it would seem appropriate to consider such matters at greater length than was possible this afternoon, even in the

  811
  lengthy exchange of questions and answers.
  In observation of your strictures, Mr. Speaker, that questions and answers should be brief, it was impossible to do more than headline the industry's predicament during that exchange. It was also impossible to draw attention to the problems of particular sections of the industry. For example, there was no mention in the Minister's speech of the problems of the shellfish industry. I cannot now deploy the arguments that would be deployed in the course of a full debate. However, it is clear that the Minister did not give an undertaking, and he specifically refused to say whether he would offer any financial assistance to the industry. He took refuge by pointing to the fact that £3 million of aid had been given to the industry in the spring. However, the industry understood that that money was an interim offer of assistance. It understood that the Government would come forward with substantial assistance in July.
  The president of the Scottish Fishermen's Federation, Mr. Gilbert Buchan, has made clear that he expected Government action in July, and not mere consideration of the issue. That being so, the Minister owes the House a full statement, indicating the Government's response, before the House rises. Hon. Members should be entitled to deploy the case on behalf of a suffering and important section of our industry.
  Mr. Speaker: The hon. Member for Caithness and Sutherland (Mr. Maclennan) asks leave to move the Adjournment of the House under Stand-
  812
  ing Order No. 9, for the purpose of discussing a specific and important matter that arises from a statement that was made this afternoon, and that he believes should have urgent consideration, namely,
  "The continuing deep depression of quay prices for fish, the hardship created for the industry by the Government's failure to respond to its predicament and the urgent need for substantial financial assistance if the industry is to survive."
  I listened with great care to the exchanges this afternoon, and especially to the arguments that the hon. Gentleman advanced. I bore in mind that we are approaching the end of the time available for debate. As the House knows, under Standing Order No. 9 I am directed to take account of the several factors set out in the Order but to give no reason for my decision.
  I listened with anxious care to what the hon. Gentleman said, but I must rule that the hon. Gentleman's submission does not fall within the provisions of the Standing Order and, therefore, I cannot submit his application to the House.

  STATUTORY INSTRUMENTS, &c.
  Mr. Speaker: By leave of the House, I propose to put together the two motions on the Order Paper.
  Ordered,
  That the Anti-Competitive Practices (Exclusions) Order 1980 (S.I., 1980, No. 979) be referred to a Standing Committee on Statutory Instruments, &c.
  That the Local Authorities (Relaxation of Controls) (Scotland) Order 1980 be referred to a Standing Committee on Statutory Instruments, &c.— [Mr. MacGregor.]

  COAL INDUSTRY BILL
  As amended (in the Standing Committee), considered.
  Mr. Speaker: No amendments have been selected for consideration.
  Order for Third Reading read.
  5.14 pm
  The Secretary of State for Energy (Mr. David Howell): I beg to move, That the Bill be now read the Third time.
  Mr. Speaker: I have selected the amendment in the name of the Leader of the Opposition.
  Mr. Howell: I do not wish to detain the House by repeating in detail the points that were covered on Second Reading. It might be more helpful if I concentrate on those issues that have received particular attention since then and have given rise to concern, and in some cases, misunderstandings.
  The House will be aware—this was raised in Committee—that an economic summit was held in Venice towards the end of June. I had the privilege of attending that meeting. Among other things, it was concerned with energy, and energy strategies for the OECD countries. At the end of the meeting a declaration was issued which rightly attracted a great deal of attention. Those who are concerned about the coal industry, which includes most of those in this House and most members of the Committee, were particularly worried about what the summit had to say about coal. The United States of America, Canada, Japan, France, the Federal Republic of Germany, Italy and Britain attended the summit, and in a communique they committed themselves together to a doubling of coal production and use during the next 10 years. The important word is "together", and that means adding up all the countries at the summit. Obviously, the circumstances of each country differ enormously.
  As hon. Members will know, the United States of America has vast reserves of coal, much of which is easily accessible by opencast methods. It is one of the world's largest coal producers, yet it does not use coal to anything like the
  814
  extent that we do. Less than half of its electricity is generated from coal. It is clearly reasonable to think that the great bulk of the increase in coal production that the seven countries seek will be found in the United States of America. On the other hand, Italy and Japan—also represented at Venice—have no great reserves of coal. With the exception of their steel industries, they make little use of coal. They have indicated that their aim will be to use more coal for power generation and general steam raising. However, that coal will need to be imported.
  Of the seven countries, this nation is in a unique position, because we already use coal for a higher proportion of our energy needs than any of the other Venice countries. The development of the United Kingdom coal industry is proceeding in accordance with the ideas that were first put forward in 1973 by the National Coal Board. At that time a Conservative Government were in office, and those ideas were embodied in "Plan for Coal". That plan was drawn up in the expectation that oil would become scarcer and more expensive from that point on. Although that expectation seemed about to be belied in the middle and late 1970s, it has been borne out by events.
  Proposals for developing the industry were formally endorsed in 1974 by the previous Labour Government. At that time, and subsequently, the Conservative Party affirmed its support for that concept. There have been delays in the progress of some of the projects specified in the original proposals. Those delays had a variety of causes, but they were not the result—as far as I know—of any Government's actions. We expect that the original "Plan for Coal" will be more or less completed by later in the 1980s. There has been continuity all the way through under successive Governments. Our strategy for coal is drawn up on the basis of that continuity.
  From that strategy stems the various financial provisions in the Bill. First, it increases the borrowing limits, which should be sufficient to sustain National Coal Board investment at the high rates projected in the March White Paper—that is, about £800 million a year at today's prices for about three years. Secondly, it provides for uprating grants of over £500 million on a tapering basis

  815
  over the four years of the strategy period, until 1982–83. Thirdly, it makes a continuing provision after 1982–83 for social grants to help with the enormous burdens of the past and to ease the transition from what was a declining industry struggling with worn out, uneconomic capacity and feeling that world events were turning against it, to a modern industry operating with high efficiency, much improved working conditions and with colossal potential for expansion. That is the turnround that we all want to see. Nobody interested in the coal industry disagrees on that common ground.
  In considering the implications for the United Kingdom coal industry, it is right to bear in mind the progress that has been made so far. Britain uses coal to a much greater extent than any of the other Venice powers. Over 70 per cent. of our public supply electricity is generated by coal. The next highest figures are 55 per cent. for West Germany and just under 50 per cent. for the United States. The other four countries are way behind those levels.
  In terms of overall energy supplies, the latest comparable figures are that the United Kingdom draws 33 per cent. of its primary energy supplies from coal, compared with 27 per cent. for West Germany, 19 per cent. for the United States and only 14 per cent. for Japan. Clearly, there is less immediate scope for further developing coal production and use in the United Kingdom than there is in the other countries. That is because, thanks to the foresight of successive Governments—and neither side can claim the credit nor take the blame—and the enterprise of both sides of this enormous industry, we have come a long way. We start further down the track than any of the other Venice powers.
  I say that not in a spirit of complacency. There is no room for complacency in any area of energy policy in the next 10 dangerous years. However, for us the Venice affirmation was nothing new. It was an affirmation by the seven countries represented that coal must be developed. Both sides of the House and all parts of the industry made that affirmation six or seven years ago.
  The new prospects for coal, nationally and internationally, are now fully understood. They will help to dispel the cloud
  816
  of fear that still hangs over some people who work in and speak tor the industry. Some people fear that the new investment is a temporary phase and that we shall go back to the bad days of the 1960s. They fear that we shall return to years such as 1967–68 when 62 pits closed and the work force dropped by 45,000. It is no wonder that such times are mentioned when I have the privilege of talking to members of the National Union of Mine-workers.
  Mr. T. H. H. Skeet: I am following my right hon. Friend's argument with keen interest. We are providing additional capacity in the United Kingdom. Is my right hon. Friend also promising to provide additional markets? Where will the coal be sold? What relevance is the conference in Italy because we are discussing the world coal trade?
  Mr. Howell: Coal produced at an economic and competitive price will find its markets. As the price of oil in real terms continues, perhaps not smoothly, to rise as it is influenced by political interference or decisions to cut production in the oil producing countries, the competitive position of coal will improve and the markets will open up.
  Pit closures will continue. They are inevitable in an extractive industry. No one can shut his eyes to the fact that closures will take place. However, they will be balanced by new capacity and new jobs. The "Plan for Coal" is based on a gradual replacement of old capacity by new.
  Mr. George Grant: Will the right hon. Gentleman give way?
  Mr. Howell: I am sure that the hon. Gentleman has a speech to make. I am sure also that he will make some valid points, because he knows the subject.
  The message of Venice, which has come up in debates since the Second Reading, is clear and worth emphasising. It is that coal is here to stay. The industry will expand, and we shall move on from the defeatist days. In our view, that expansion is best achieved if the industry has soundly based finances. Our aim is to achieve that.
  Mr. Grant: The Secretary of State talks of the need to dispel fears about pit closures. He also mentioned

  817
  competition. Does he accept that the fears are real? Will he examine the stocks of undistributed coal? There are 3 million tonnes more this year than last year. He must understand that the fears are genuine, especially since he has introduced financial restrictions in the Bill.
  Mr. Howell: I shall come to the financial pattern in a moment. Whether it imposes a straitjacket is something that I shall discuss later. The stocks were low last year and they are higher this year. No one can be blind to the recessionary forces operating in the West generally. They create a challenge for all industries, including our great extractive industries. I do not deny what the hon. Gentleman says, but the challenge is being experienced by all British industries.
  I turn to the blocking, or amending, motion tabled by the Opposition. It suggests that the financial limits in the Bill and the money resolution are too restrictive. That is not the situation. On taking office we found that the coal industry's finances were in a disquieting state. For two or three years the industry's reliance on Government grants has been growing. In the short term we have little choice but to continue the grants. For the financial year 1979–80 grants total £ 250 million, of which £ 190 million are operational grants which effectively make up losses incurred on various aspects of the board's commercial operations. The total is more than double the provision made by the previous Administration in the January 1979 public expenditure White Paper. If there is a restriction now, there was certainly a restriction then.
  In the longer term, remedial action was necessary. We started from the premise, which we maintain strongly, that it is not for the Government to run the pits. The operation of the British coal industry is a matter for the National Coal Board, in co-operation with the NUM. It is for the Government to establish the framework for operations and to let the NCB management manage. The need was to discuss and agree with the NCB the financial framework, and to set an agreed limit for grants and external finance in the years ahead. We began to do that in the summer, and continued into the autumn of 1979.
  818
  The conclusion that we reached was that a return to breakeven by the NCB—after interest and after social grants, which go on beyond the strategy and for which we recognise a continuing need—was possible by the financial year 1983-84. Accordingly, we have agreeed with the board limits for operating grant in the years ahead. These are in 1979 money, so that every figure that I mention has already been enlarged by the processes of inflation. I am speaking in constant money. For 1980-81, the figure is £ 135 million. In 1980–81 money that will be a considerably higher figure. For 1981–82 the figure is £ 109 million, and for 1982-83 it is £ 28 million. All those figures are at 1979 survey prices, which are basically the prices of two years ago, and not even the end of 1979. The figures will be revalued to outturn prices in accordance with inflation. When hon. Gentlemen talk about restriction strait-jackets, they should note that. Comments made on Second Reading and, I believe, in Committee seem to indicate that there is confusion. It was believed that they were hard and fast, constant figures that would not be adjusted to money values.
  Mr. Albert Roberts: The right hon. Gentleman mentioned agreement with the NCB. Was that arrived at under duress?
  Mr. Howell: The NCB accepts the strategy and recognises that it is a tough challenge. It considers that the challenge should be faced and the strategy pursued.
  I repeat that the grants can be adjusted for inflation. In 1980–81 we expect to pay out over £ 170 million in operating grant, by comparison with the uninflated figure of £ 135 million. The total paid in operating grants over the four years from 1979–80 to 1982–83 is likely to exceed £ 500 million.
  As I have made clear, the Bill also provides for the social grants to go on and for there to be increases in some areas of social grant to meet the difficult trans-sitional problems. Those grants are an essential part of the modernisation process, and we do not consider it possible to phase them out in the foreseeable future, and nor is it our intention to do so. I made that clear on Second Reading, as did my hon. Friend in great

  819
  detail in Committee, but it is worth putting firmly on the record. I hope that that reassurance will meet the worries of those who see that side of things also ending. Those grants will not end.
  The Bill provides also for an increase in the board's borrowing powers, amounting to no less than £1,600 million. It also provides for loans to be made to the board with interest deferred, which is a useful feature and will allow the NCB more flexibility in financing projects with long lead times. That option was not adopted by our predecessors, who saw no need for it. We believe that it will be a valuable and useful weapon for the National Coal Board.
  The main provisions of the Bill in terms of limits on grants were settled with the board in November. In the past seven months the events that have unfolded have not been precisely as predicted. No one can ever see the precise shape of events. Some of the unexpected events are not helpful to the board; for example, the economic downturn in the United Kingdom and world-wide, which must depress the market for coal and has made imports available at low prices. Also, the rationalisation of the steel operation has and will undoubtedly reduce that need for coal.
  Other aspects will help the board. For example, the further increase in the price of oil. which will make more favourable the coal-oil price ratio and make coal more competitive, and the Venice summit declaration, which I talked about at the beginning, will increase the possibility for coal exports into world trade if it can be produced at a competitive price.
  Our strategy for coal is carefully thought out. It is a robust one. I reject the mistaken concept of a straitjacket.
  Mr. John Evans: The Secretary of State mentions competitive prices for the export market. Does he accept that some of our competitors are unfairly subsidised? Does he consider that fair competition?
  Mr. Howell: That does not apply to those that are expanding into world markets and entering into the huge world coal contracts for the future. The Australians, Canadians and Americans are not subsidised. The steam coal industry in this country has nothing to fear
  820
  if it continues with its present trend of productivity and performance. As the hon. Gentleman knows, it is competitive. However, in the world coal trade, which will be entered to a perhaps more limited extent than some people realise, because there will be such an international demand for world coal and so many contracts tying up supplies, subsidised coal will not make the lead.
  I repeat that I do not accept the view of a straitjacket. On the contrary, not to have a strategy and to chop and change all the time, would create uncertainty and difficulty for the NCB which is the last thing that the industry needs or wants. Our purpose is not to confine the industry or to hold it down. It is absurd to approach the prospects of such a great energy industry in that frame of mind. Our object should be to build it up, restore it to financial strength and viability, put it on a firm basis for expansion and open up new and exciting possibilities for coal.
  In saying that I emphasise again that it is not the Government who can will the industry to succeed. Only the industry can do that. The Government can create the conditions for its success, which we believe we are doing. The industry will succeed, and we have the confidence in its management and men, which sometimes those who comment perfectly sincerely on the industry do not reflect. I ask the House to reject the Opposition motion and to give the Bill a Third Reading.
  5.36 pm
  Dr. David Owen (Plymouth, Devon-port): I beg to move, to leave out from "That" to the end of the Question and to add instead thereof:
  "this House declines to give a Third Reading to a Bill which does not provide adequate borrowing powers to enable the National Coal Board to carry on its operations in a satisfactory manner, and proposes to extinguish operating grants by the end of the financial year of the Board in 1983 as defined in the Bill."
  I urge my right hon. and hon. Friends to vote for the reasoned amendment but not against Third Reading. Parts of the Bill will bring relief in the coal industry. It also provides much needed financial support. For those outside the House who do not understand the conventions, I should explain that by voting for a

  821
  reasoned amendment we are focusing our criticism on the central core of the Bill which we find objectionable. The late Iain Macleod once argued in this House that he was not voting against the Third Reading of a Bill because he would not wish to vote against even a one-legged Father Christmas. I ask myself whether there are any elements of a Father Christmas in this Bill. I see not a shade of a Father Christmas but rather an Ebenezer Scrooge.
  It was interesting that the Secretary of State was not able to pray in aid one single reputable body that believes that the financial targets are fulfillable. He said that he had great confidence in the men and managers in the coal mining industry. There is no group of people for whom I have greater respect. We have a great deal of coal mining expertise on these Labour Benches.
  Where are the people who believe that this industry can reasonably be asked to live within those financial limits? First, the board does not believe that it can. As the chairman of the National Coal Board made clear when he addressed the NCB conference in Eastbourne:
  "the Board were concerned about some other financial aspect of the Bill—particularly the timetable for phasing out operating grants. This view had also been expressed by MPs on both sides of the House of Commons when the Bill was being debated. At the last Tripartite meeting with the Government, the Board and the unions expressed the hope that there would be more flexibility in these financial arrangements."
  The NUM is on record as saying that it does not believe that it is possible for the industry to meet its targets. The union president Joe Gormley has made that abundantly clear. The National Association of Colliery Overmen, Deputies and Shotfirers has made clear that it does not believe that the industry can live within its financial straitjacket. The managers' association, a non-political body which represents the views of management throughout the industry, has also made clear that it does not believe that the targets are feasible.
  Can the Secretary of State pray in aid any of the independent commentators who comment on the energy industry, usually with a great deal of information? I have not been able to find anyone, even on a Conservative newspaper, who is prepared
  822
  to endorse the financial targets that the Secretary of State has set for the industry.
  It appears that only the Secretary of State and the Under-Secretary, together, presumably, with some officials in the Department, believe that it will be possible for the industry to achieve its targets. It might have been possible if the situation had remained the same as it was in August 1979 when the strategy was first negotiated with the NCB, but throughout the Committee stage we searched in vain for the degree of flexibility in the interpretation of the financial targets that we were promised on Second Reading.
  We regret that the Secretary of State did not feel able to come to the Committee to discuss these issues. The Under-Secretary appeared to be living in a rigid straitjacket. With the sole exception of the decision to take investment in liquefaction outside the financial limits of the Bill, there was no evidence of flexibility or financial leeway.
  The Under-Secretary attaches a great deal of importance to the deferred interest arrangements in the Bill. I admit that if they were flexibly applied they could give the NCB some freedom, but the Under-Secretary was unable to give us any details of how the arrangements are to be applied. We were unable to quantify the extent to which the industry may be able to benefit from deferred interest payments.
  We had hoped that the Secretary of State would carefully consider the arguments made in Committee, go back to the Chancellor of the Exchequer and come to the House on Third Reading to announce a great deal more flexibility for the industry. There has been no such give in the Government's position. I conclude that the position has not materially changed from the time when the Bill was presented. Indeed, in one significant sense—the Phurnacite plant—the situation has materially worsened, with severe consequences.
  The Secretary of State referred to the Venice summit. At least he was there, though not as a participant, and we must attach some importance to his interpretations. However, his interpretation of the word "together" in the communique is one of the most interesting explanations that I have come across. It appears that "together" means "We are all together, except the United Kingdom".

  823
  The Government went to Venice after the publication of the Coal Industry Bill and with an existing strategy for coal. They were a joint signatory to an international committee to double coal output by 1990, but, from the moment the ink was dry, the Prime Minister was denying that she had made any commitment. There has been no evidence that any new decision was taken at Venice. I have attended two summits, but if that is the way that everyone who attends summits nowadays is to interpret commitments, it is no wonder that the net outcome has not been as satisfactory as many believe it could have been.
  The Secretary of State said that he found a disquieting situation in the industry and a growing reluctance in relation to grants. But he knows that it was implicit in "Plan for Coal" that there would be heavy Government investment to expand an industry that had been declining. The central objective of "Plan for Coal" was a commitment to coal output targets and a commitment to finance them.
  The Secretary of State's policy of financial constraints, with no commitment to coal output targets, is not only against the national interest and the arguments for self-sufficiency in this country but is diametrically opposed to EEC energy policy, to which the right hon. Gentleman has been a co-signatory at Energy Council meetings.
  In this area, as in so many others, it is time that the Government looked at what is being done by our major industrial competitors in the EEC. I have the latest figures for direct aids to production—coal subsithes—in the EEC. For 1979, the Belgian Government paid about £ 34 per tonne, the Federal Republic of Germany paid about £ 15 per tonne and France paid £18 per tonne. In the nearest comparable year, 1978–79, the United Kingdom paid only £1 per tonne and in 1979–80 we shall have paid £1.60 per tonne. There is a massive difference in the degree of Government support for the coal industry in this country compared with that in Belgium, West Germany and France, and the gap is widening. There was a further increase in financial support by EEC countries in 1979 compared with the previous year. They see the reason for expanding coal output and
  824
  they are prepared to help their coal industries. Only our Government seem to have doctrinal arguments against such assistance.
  Another aspect that needs to be stressed is that our production costs are substantially lower than those elsewhere in Western Europe. Of course, that is one reason why other European Governments are prepared to provide direct subsidies. The United Kingdom's coal production costs are about one-half of those of Belgium, nearly one-third of those in France and nearly one-quarter of the costs in West Germany. That is a remarkable achievement of our coal industry and instead of knocking it on the head, which everyone believes is being done by the Bill, the Government have a duty to provide greater financial support. In no area is that more important than in imports.
  Sir Derek Ezra told the Eastbourne conference that:
  "The Board's view was that imports should complement, not replace UK coal. They firmly believed that any excessive imports due to short-term market fluctuation could do long-term harm to the coal industry and its customers alike."
  The Government have an obligation to assist the board in overcoming the short-term fluctuations that it faces. It would be gravely damaging to "Plan for Coal" if we allowed the short term to impede the medium to longer-term expansion of the industry.
  Major changes have taken place since August 1979. There was no answer in Committee to the fact that the NCB expects the higher level of national insurance contributions to cost it about £12 million per annum, and the further increase in oil prices, which will increase opencast costs, will put an extra burden on the NCB of about £15 million per annum.
  In addition, there will be a substantial loss of sales revenue on coking coal sold to other markets in order to undertake necessary commitments to alleviate the situation in South Wales. The August 1979 strategy review showed a broad balance over the four years 1980–81 to 1983–84. The NCB was being pushed to live within a difficult financial target, but I think that it believed that it could do so. It now does not believe that it can live within the target. This is made clear in its public statements.

  825
  I am worried most by the stocking situation. For each 1 million tonnes of imbalance between supply and demand, leading to stocking or sales at low prices, the National Coal Board might expect its revenue results to be worsened by £10 million at 1980 money values. In cash terms, the adverse effect for each one million tonnes stocked could be £40 million. There is a serious situation, with considerable coal stocking. This is further aggravated by the financial situation in which the Central Electricity Generating Board finds itself.
  The CEGB faces a dramatic drop in demand. The figures were revealed to the Select Committee of the House yesterday by the chairman of the CEGB, who showed that there had been a substantial fall in demand over the first quarter of last year. I believe that the figure is 2.6 per cent. If this continues, we face, in the short term, an extremely serious situation. I believe that situation has already been reached. The National Coal Board naturally wants to sell all the coal that it can do the Central Electricity Generating Board and move its stocks from Coal Board land to that of the CEGB. The CEGB, because of the financial restrictions placed on it, is reluctant to accept this coal because it comes on to its books. It finds difficulty in taking the coal for which it is contracted.
  There is now genuine anxiety about whether the CEGB, facing falling demand and tight cash limits, will be able to meet its commitment to 75 million tonnes from the National Coal Board. I hope that the Under-Secretary will give some indication of his attitude on the matter. Are the financial restrictions and cash limits being applied to the CEGB to be relaxed? It is as important in this debate to argue for a relaxation in CEGB cash limits as it is for those of the NCB.
  Mr. Edward Rowlands: And for the British Steel Corporation.
  Dr. Owen: As my hon. Friend says, there is also the serious problem of BSC. If demand from Llanwern was to be seriously affected, this would have serious consequences in South Wales. Although this debate is specially related to coal, my case can be argued across the whole of nationalised industry. There is an
  826
  overwhelming demand, in the interests of the coal industry, for an early relaxation, before the Summer Recess, of the financial limits set for the Coal Board, for the British Steel Corporation and for the CEGB.
  There is no room for the CEGB to increase its price of electricity. In its comments on the increase, due to take place on 1 August 1980, the Southwestern Electricity Consultative Council said:
  "These increases amount to an average of 10-7 per cent. on present quarterly tariffs and their size has shocked members of the Council. It is recalled that prices rose by 17 per cent. as recently as 1 April this year and at that time, although statements by the Government have pointed to a further rise in the Autumn, there had been grounds for hoping that this would not exceed 5 per cent. By the time the August increases are implemented, electricity tariffs will have been swollen by about 50 per cent. in 14 months. Electricity prices cannot be insulated from the national level of inflation and this heavy burden for consumers reflects remorselessly its insidious and damaging effects."
  There is no room for further increases in electricity prices. We are facing a serious situation. The more that prices in the energy industries are increased, the more demand will be cut. This is affecting the whole industry. It affects not only the Coal Board and the CEGB. It also affects jobs. An investment cutback that affects the Coal Board will also affect the CEGB. It is forgotten what major purchasing bodies these industries are. In 1978–79, for example, the NCB purchased £1,033 million worth of equipment. Contracts for services including shaft sinking and plant hire amounted to £226 million, steel, ranging from colliery arches to haulage ropes, amounted to £161 million, coalface powered supports and machinery amounted to £318 million, other equipment and electrical goods amounted to £164 million and stores and general goods amounted to £164 million.
  The NCB is a vast investor. If its investment is cut back, the effects will infiltrate every aspect of our industrial life. The effect is already seen within the CEGB which has had to clamp down on many investment orders. A serious situation confronts the power plant industry. I do not believe that it is possible to continue with the present restrictions on CEGB investment if there is to be a power plant industry in the next two or three years.
  Mr. Dennis Skinner: They are all interlocked.
  Dr. Owen: As my hon. Friend says, all these issues are interlocked. Many people outside the House, hearing about cash limits on nationalised industries or cutbacks on public expenditure, believe that what is involved is a reduction in bureaucracy or administration. They have not grasped—I do not think any of us have—that industrial jobs are put at risk. The interlocking nature of the problem is not easily understood. Day by day, it means factory closures, lay-offs and short-time working. Until the Government understand that they have the power to make some impact on the appalling unemployment situation, we shall continue to suffer spiralling unemployment. Sensible use of the National Coal Board's investment policy can help protect jobs and prove an investment in the future. These are real jobs. These are not the artificial jobs that the Secretary of State for Industry often attacked in his heady days of Opposition. They are real jobs. They are the sort of jobs that this country has to maintain if it is to be in a position to expand its industrial base when the slump eventually eases.
  I turn to another area that causes me great concern. I asked the Under-Secretary to make it clear before the debate or during the debate what would happen to the national smokeless fuels plant at Aberaman. I accept that he answered a written question on this on 21 July. The impact of that decision is appalling. We asked for an investment of £36 million of which about £5.5 million might be met by regional development grants. The Government have turned it down flat. This is a serious situation, with repercussive effects throughout South Wales, if the decision is carried out. Will the Under-Secretary say what is likely to be the attitude of the Alkali Inspectorate towards the plant? At risk, I understand, are five pits and at least 1,000 jobs in Aberaman. How can this be justified when the coal consumers are extremely anxious about the consequences? A letter from the Chamber of Coal Traders, referring to the Coal Industry Bill, says:
  "It is our view that a high degree of self-sufficiency should form the basis of any national energy policy but the Government's
  828
  proposals in the Coal Industry Bill will force consumers of naturally smokeless and manufactured smokeless fuels to rely more heavily on imported fuels because home produced supplies are not available. And the British consumer will suffer since foreign fuels are substantially more expensive. Such a policy does not seem to us to make economic sense and will give rise to severe social consequences if numerous pits close in the South Wales coalfield".
  It is no use asking people to switch to coal and to open up their chimneys and to have—I believe rightly—pollution legislation which ensures that people have to use smokeless fuel, only to find suddenly that there is no indigenous production and that supplies have to be purchased from overseas. Is it only the Federal Republic of Germany and other European countries who will invest? Are we not going to invest in our future? We know what will happen. The German coal industry which, as I have already demonstrated, receives greater assistance than the coal industry in the United Kingdom, will be given a Heaven-sent opportunity to take advantage of the decision over the Phurnacite plant by increasing substantially its exports of manufactured smokeless fuels to the United Kingdom, which are already increasing. Sophia Jacoba a major German company, is stepping up its production of a suitable alternative, marketed as Extracite. Large tonnages of this fuel will be sold on the market in the United Kingdom. This in turn could well affect the development of works and plant for the home production of manufactured smokeless fuels as substitutes for anthracite.
  One of the meanest and narrowest decisions is not to go ahead with the Phurnacite plant. It will have serious consequences on the longer-term planning of manpower within the South Wales coal-field. It is crucial for South Wales to be able to plan the introduction of new pits or the rundown of existing pits over a period. The policy on imported coking coal, if the Redcar decision is to go ahead, will also have extremely serious consequences in the North-East.
  I do not want to give any comfort to those who, perhaps unrealistically, fear pit closures. I know about the anxiety that the threat of redundancies and closures produces in many industries and I do not want to exaggerate it. I believe that Sir Derek Ezra is determined that the pit closure programme should follow

  829
  the due procedure and that the tripartite agreement will be kept. But, even if he keeps to the agreement, if the financial constraints under which he has to operate are so tight, those areas where there has not been an exhaustion of coal, where the seams are still able to produce coal of a quantity and quality that we need will face the possibility of closure because of the high cost.
  Mr. Rowlands: I apologise for interrupting my right hon. Friend who is making the most cogent of presentations of the problems. Is he aware that not only have we lost a market for 1 million tonnes as a result of the Margam decision to import coking coal, but that we have firm reports that the British Steel Corporation has marketing men in the United States trying to sign up contracts to replace the Llanwern market? Some of our worst worries about pit closures—we do not want to be scaremongers because we live in these communities—could come true as a result of this nonsense. Will he challenge the Government on that point?
  Dr. Owen: I agree with my hon. Friend. It is important that the Under-Secretary should say that the agreement on coking coal, which was painfully constructed for this year, will carry on into 1981 and 1982. I hope that as a result of the negotiations he will be able to make that announcement. There would be strong resentment if, as in previous years, the British Steel Corporation were to cobble up an agreement without the fullest consultations with the National Coal Board, leaving the NCB to face a sudden dramatic fall in the demand for coking coal.
  What should the Government do? The relaxation of the financial constraints under which these industries operate is the first essential. But more can and should be done. I have already drawn the attention of the Under-Secretary to the need seriously to consider switching modern oil-fired stations to coal. The figures that I have gleaned show that the fuel bill for a modern coal-fired station, such as Drax, using about 5 million tonnes per annum, is about £170 million at present day prices. That compares with a bill of over £260 million for a modern oil-fired station, such as Pembroke, using the same
  830
  amount of fuel in coal equivalent terms. Perhaps the Under-Secretary will comment on those figures. I gave them in Committee and he did not comment on them at that time. If the figures are correct, the argument for switching earlier than might have been anticipated from oil to coal is considerable.
  Mr. Skeet: Is the right hon. Gentleman aware that the capital cost of converting from oil to coal is tantamount to starting afresh and building a new plant?
  Dr. Owen: The hon. Gentleman grossly exaggerates. Switching would not be taking place to the extent that it has taken place in European countries over the past few years if that were so. We are all trying to switch out of oil. I accept that it has a capital cost, but it is nowhere near as great as the hon. Gentleman implied. If the fuel cost savings are anything like I have suggested—a saving of £90 million a year—the capital cost is containable.
  The Government should be doing other things. They should be bringing forward the modernisation and replanning of existing power stations and, where they are oil-fired, switching them to coal. These small power stations throughout the country would have an important effect. First, such a course would provide a market for coal at a time when the market is extremely weak. Secondly, it would provide work for the power plant industry by giving it, not a large work load as for the very large power stations, but a useful infilling work load which it needs. It would provide jobs around the country and would be an investment in the longer term. It would also allow the Government to conserve energy by linking these stations more imaginatively than hitherto to combine heat and power.
  Nothing has been more disappointing than the parsimony shown by the Government in their reaction to the Marshall report. That report was carefully documented. It came to a firm conclusion and asked for finance. All that the Government have done has been to ask for yet further studies. The financial contribution and support necessary for local authorities to go ahead in some pilot areas have not been forthcoming. We have yet more strategic surveys and more questions are being asked.

  831
  Our indictment of the Government is serious. It is not that the intention behind the Bill is as malign as might appear. I believe that it was put forward in the genuine belief that it would allow the coal industry a steady future and reasonable expansion. But there has been a dramatic change in the country's economic circumstances for which the Government must take a high degree of responsibility. When I hear the Prime Minister talk about her highest priority being inflation, I cannot help but ask "Why did you increase value added tax? Why did you add in so many different ways to the inflationary spiral facing the country so that within a year we have had double the rate of inflation?"
  All these consequeces are felt by these major industries. They are battling in a difficult situation, with falling demand, high interest rates and high prices. They are facing a squeeze on their investment which will add to the already dramatically high unemployment.
  I have tried not to be totally negative but to put forward some concrete suggestions for financial investment. I realise this will mean breaking the limits that the Government have set themselves. I believe that it can be contained. I can think of few more worthwhile investments. It would create jobs, allow industry to modernise and be the right response to the present situation. It will have to come. Everyone in the House believes that day is coming. Whether the U-turn is a gentle curve or more like a V-turn will be up to the Government. But there is no doubt that they cannot continue with their present policies. Already there are signs that the Government are beginning to switch. We have seen the obvious relaxation that is coming in the BSC's financial limits.
  I urge the Secretary of State to reconsider his position on the coal industry. He has a heavy responsibility. We thought that the coal industry's investment programme had been largely taken out of politics. There has been an agreement on the need to invest. The Under-Secretary makes eloquent speeches about his commitment to the coal industry. We want action—a positive decision. It cannot wait until the autumn. We hear rumours that the Government are thinking of relaxing the financial limits on the nationalised industries some time in the autumn. It
  832
  would be an act of folly and would be socially unacceptable to wait any longer. If this decision is to be taken—it is long overdue—it ought to be taken in the next few days.
  I urge my right hon. and hon. Friends to vote for the reasoned amendment. If, as I expect, the Government get the Bill through, it will have to go to another place. There is still time for the Government to rethink their strategy, which is fundamentally flawed and is capable of producing great damage to the coal industry, to the confidence of those who work in it and add further to the savage twist of unemployment facing every part of this country, but none more so than the areas where there is a high mining contact—a big mining industry. I refer particularly to the North-east and South Wales. Those areas are crying out for a little sensitivity and a little understanding of the situation facing them.
  6.10 pm
  Mr. John H. Osbom: I do not support the line taken by the spokesman for the Opposition. I hope that my right hon. Friend will retain the financial controls and disciplines that he outlined in his speech.
  British coal has a future. Coal is a long-term economic source of energy and has a vital role to play. Though I support my right hon. Friend, I suggest that he engages in further assiduous discussions with our friends in the EEC. My right hon. Friend rightly pointed out that in this country coal accounts for 33 per cent. of our energy consumption. The figures are lower in Germany, France and elsewhere. Coal is important to Britain.
  The right hon. Member for Plymouth, Devonport (Dr. Owen) spoke of payment for stock. I have been in the tool, steel and other industries, and I can say that that is a normal commercial problem that faces any supplier or user of a bulk commodity. One would imagine, after listening to the right hon. Gentleman, that this is a new problem because it is affecting the coal and electricity industries. In view of the right hon. Gentleman's comments, I regret the millstone that is tied around the neck of any Conservative Minister with the nationalised BSC and nationalised utilities such as the CEGB and State-owned coal. We discussed those issues two days ago.

  833
  Our debates in Committee coincided with the national conference of the National Union of Mineworkers, and Members sponsored by that union of course forecast and followed up many of the speeches made at that conference.
  Government policy is positive and takes over where the previous Government left off. On Second Reading optimism about the future emerged. Though there is a world shortage of oil and gas, coal enjoys a seller's market throughout the world. Our coal exports, however, are infinitesimally small compared with our total output. British coal should be in a seller's market. I hope, judging by EEC predictions, that our industry will eventually enter the seller's market, because if it does not the EEC will go short of energy.
  Anyone living in the villages of South Yorkshire and the bordering areas of Derbyshire and Nottinghamshire—I speak of the newer villages round Selby—could hope for a secure future by producing a commodity needed by other people. It is too early to speak of the Vale of Belvoir.
  The Second Reading debate contained references to modern mining techniques and methods of keeping down production costs while increasing productivity. There have been two interesting meetings in the House of Commons lately. The parliamentary and scientific group recently discussed robots. That meeting was addressed by the director-general of PERA, Professor Hegginbotham, who was supported by Sir Henry Chilver, from Cranfield, chairman of the committee that produced the worthwhile ACARD report on this subject.
  A few weeks ago Professor Thring, one-time head of the fuel department at Sheffield university, and of QMC, spoke in Westminster. He concentrated on the need to introduce labour-saving devices in order to increase quality and productivity and at the same time reduce costs. If those suggestions were accepted I believe that the miners would benefit in the same way as other people in other industries and countries have benefited. The Yorkshire coal industry need not be a Cinderella industry, though one might imagine that that was the case when listening to Mr. Arthur Scargill and
  834
  others. It is an industry with a future, and Opposition Front Bench spokesmen are wrong to denigrate it and engender gloom as they did in Committee.
  On Second Reading I spoke of my visit to the United States. I met many people who envisaged a great future for coal though admittedly in opencast rather than deepcast mining, in the United States. I met American industrialists who not only run utilities but are engaged in the extraction of gas and oil. They are taking advantage of solid fossil fuels. The attitude of Opposition Members was in contrast to that.
  I hope that the Select Committee on Energy will create optimism by better informing hon. Members who are interested in coal and energy. This defeatism is wrong at a time when there is an opportunity for the British coal industry. Perhaps our outlook is too old-fashioned, and perhaps leadership within the industry is not as dynamic as it might be. My right hon. Friend has increased the industry's borrowing powers by £1,200 million, to £4,200 million. That continues the momentum begun in 1976, with £600 million a year building up to £800 million a year going into the coal industry.
  The hon. Member for Midlothian (Mr. Eadie) and others talked of pit closures in the North-West, the North-East and Wales. In any mining programme, whether of coal or other minerals, if the product is of low density, or if costs are too high, there is a general acceptance that sooner or later high-cost, futile operations must be abandoned. It is a tragedy that the British coal industry should consider itself to be an exception.
  At the NUM conference Sir Derek Ezra was challenged about the closure of 50 pits. Sir Derek denied such closures, but Mr. Arthur Scargill is reported to have said that Sir Derek's denial was a lie.
  Perhaps it was regrettable that in Committee we concentrated upon closures rather than opportunities. However, I accept that there is fear of closures in the constituencies of some Opposition Members. How can we deal with that challenge? We know from our debates that the Community is expecting a target of 170 million to 200 million tons a year from this country, much of which should

  835
  go into EEC exports. On 21 July, in answer to a question from the hon. Member for Rother Valley (Mr. Hardy), my right hon. Friend said that that target depended on coal being sold at competitive prices. That is the rub and it worries me.
  An interesting Community document—C174; Volume 23—was produced on 14 July 1980. It contains figures that cause me to think, particularly when I recall the erudite speeches made in Committee. The document contains a list of prices up to 1 April 1980. The South Yorkshire price for long-flame, No. 2 nuts coal of 30 to 50 mm is 88·85 US dollars compared with 95·22 in Lorraine, 96·24 in Belgium and 106·38 in the Ruhr.
  If we dealt with smaller nuts, similar figures would be produced. The South Yorkshire figure is 80·95 US dollars per ton as compared with 106·38 dollars in the Ruhr. In table 20 of the report the equivalent prices for imported coal vary, but I calculated it to be about $38 a tonne. Imported coal, therefore, is cheaper.
  The right hon. Member for Devonport quoted subsidies in Belgium, Germany and France. I have a different set of figures, but I do not dispute the right hon. Gentleman's figures, because they are probably more up to date than mine. We must remember that the biggest coal producer is Britain, with 120 million tons a year. Germany produces 93 million tons and the countries getting the biggest subsithes—France and Belgium—produce 18 million tons and 6 million tons a year respectively. This must be put in perspective. The big subsidies are in Belgium and France, which produce small tonnages. This matter should be examined by a Select Committee. Certainly there is a subsidy in Germany as well, and we should relate our position to that.
  In this country we are concerned about the impact of imported coal, whether it comes from the United States, Australia or South Africa. In the United States there are opencast opportunities and transport challenges. I hope to go with the Commonwealth Parliamentary Association delegation to Australia, a country that I visited more than 25 years ago, when I saw much of its mining potential—not only iron ore but coal.
  I do not want to touch on the statement on agriculture that was made this
  836
  afternoon. With the common agricultural policy there is bound to be a problem for New Zealand, and certainly for Australia. The CAP imposes a levy on imported foods to Britain, when we must import more food than any other EEC country. I dare not raise the question of a common energy policy—as I did on Second Reading—but I suggest that such a policy would benefit this country. The CAP may be against Britain's interests but a CEP could be in our interests. I accept that this makes no appeal to the national executive committee of the Labour Party or to the National Union of Mineworkers. I accept also that my right hon. and hon. Friends are a little timid.
  Mr. Skeet: As very few people in the United Kingdom support the CAP, how many people in Europe could be expected to support the CEP?
  Mr. Osborn: My hon. Friend is right. Eight out of nine at present would be against it, and in future it would probably be 11 out of 12. This is the difficult ground that those who represent our interests in the Community must negotiate.
  What are the alternatives? British coal will never be competitive with imported coal. No Community coal will ever be competitive. There is a suggestion that by the turn of the century about one-sixth of the coal in the Community will be imported. The right hon. Member for Devonport talked about operational and deficit grants. I believe that the total grants to the NCB could be about 4¼ per cent. of turnover. That is about £200 million next year. My right hon. Friend said that in total it would be £500 million to date.
  The Community, and particularly Germany, claims that our industry is subsidised and supported, and that it does not run at a profit. It would be useful for the British and German leaders to compare notes and for our respective Governments to do the same in order to try to work together.
  I believe that imported oil, natural gas and coal to a certain extent must be regarded as an insecure source of supply to this country. The coal industry could mean a great deal to this country. We have talked about agreed prices in steel, the Paris Treaty, and the ECSC. Should

  837
  not our leaders get together and talk about agreed domestic and industrial coal prices? They should relate imported coal prices to domestic coal prices, for example. That is why at Question Time I suggested to my right hon. Friend that he should discuss with Community coal producers an agreed stable price level and try to work out a mechanism by which, if other countries inject subsidies into their industry, subsidies in Britain should be comparable.
  My right hon. Friend said that it was not for the Government to run the pits. I agree with that. He spoke about the 1983-84 limits. I share his belief that it would be healthy for the coal industry to be able to stand on its own feet. My right hon. Friend said that it was the task of the NCB to run the industry. The NCB must be given every support by a Conservative Government—I do not draw back from that at all—but the conditions are that our coal must become competitive in price and that we look for higher productivity.
  I have already talked about mechanisation and automation. If in the future I have to choose between subsidies, such as those given in France, Belgium and Germany, or some sort of levy on imported coal, I would prefer the latter. I support the Bill and reject the amendment.
  6.20 pm
  Mr. Allen McKay: I begin by taking up the challenge of the hon. Member for Sheffield, Hallam (Mr. Osborn) about Labour Members denigrating the industry and the miners. That is the most disgraceful statement that I have ever heard in a debate like this. The hon. Members here have spent a lifetime in the industry and in the trade unions, and they are now sponsored members.
  Mr. John H. Osborn: I understand the hon. Member's feelings, but I wish that Labour Members could inject some optimism into people in the industry—those in management and those down in the pits. I very much hope the hon. Member will try to do so in his contribution this afternoon.
  Mr. McKay: The fact is that throughout the history of the coal industry we have learnt to mistrust the words of Conservatives. Those fears are not
  838
  allayed by the present unemployment situation and by what has happened to the steel industry and to small industry.
  I declare an interest, although it is not a financial one. I am biased in favour of the industry that I love, because it has given me work, it has educated me and it has given me every opportunity for promotion and advancement. I shall never be able to repay my debt to the coal industry. My feelings are slightly blemished, because on 1 May my father died of pneumoconiosis after suffering for 20 years.
  In the Bill there are elements that we applaud. I applaud the element that finances people who find themselves in the situation in which my mother found herself. For 20 years she had the guts and the courage to nurse my father.
  Throughout its life the industry has always had its ups and downs. It was exploited to the full by the old coal owners, who salvaged coal—or savaged coal, I might say—from the easy, workable seams and areas, and left behind a legacy for us. Not all owners were like that, but a good many of them were. By and large, their motive was profit and that motive was to result in the exploitation of the coal industry and the mine workers themselves. I believe that during that period the country lived off the backs of the mine workers. Because of that exploitation and insufficient investment, the industry began to decline.
  I have been privileged to work for the coal industry for more than 30 years, originally as an electrical engineer and later as an industrial relations officer. During my time as an engineer I was branch president of the National Union of Mineworkers. During this period I saw the industry move out of private ownership. It was a proud day when I saw the NCB flag flying from the top of the winding gear. At last I felt that I had a stake in the industry to which I belonged.
  I have watched the industry heave itself out of being a typical village industry, at the same time retaining its proud village commitment and its traditions to its work force. In fact, it achieved world-wide recognition for the skill of its miners, the expertise of its engineers and the ability of its management, who came from the shop floor. Those ideas welded together the mineworking force. The ability and

  839
  the co-operation of the trade unions led to the rise of the industry from the condition in which it was left by private ownership. It moved from conventional mining methods of production to the use of the most sophisticated electronic, electrical and mechanical methods—methods that are not only recognised but are required throughout the world. Through its exports of expertise and mining machinery the industry earns for Britain about £200 million a year.
  In the 1960s ghastly mistakes were made as the Government bowed to the oil lobby. During that period 400 pits were lost, divisional structures were dismantled and areas were merged. In 1947 there were 958 pits, with an average manpower of 704,000, but in 1979 the figure had been reduced to 223 pits, with an average manpower of 235,000. During that time the miners held back from industrial conflict and watched the industry being dismantled. They accepted miserable increases in wages, because the then chairman of the National Coal Board told them that it was for the betterment of the industry. He said "Be calm, be patient, accept what is given, and the rewards will come later". Those rewards came. We watched other industries race away in the wages league—but still the collieries closed. We accepted the low wages and the conditions to try to save the industry—but still the collieries closed. They were closed not because the reserves were exhausted but purely and simply for economic reasons.
  The word "economic" became the most hated word in the mining vocabulary. In those days one could call a colliery anything that one wanted, but it survived. It survived until it was called uneconomic, and that sounded its death knell. A few people protested about the closures and warned that the oil would not last and that it would not always be cheap, but to no avail. The Bill brings with it that same warning. In his Second Reading speech the Minister spoke of a dynamic and vibrant industry. It is such an industry. It is poised to provide Britain with its energy requirements for many years. But at this moment, when it is poised to take off, the Bill is poised to shoot it down. The industry is being put into a financial straitjacket.
  The Bill confirms that the Government are interested in the future of the coal
  840
  industry not as a supplier of the nation's energy needs but only as a profitable concern. The industry cannot meet the Government's requirements in the three years that it has been given. Therefore, it is faced with certain directions in which it can move. It could increase its prices, but that would be inflationary and would lead to further imports of cheap, subsidised coal. An alternative would be the closure of uneconomic pits.
  As my right hon. Friend the Member for Plymouth, Devonport (Dr. Owen) said, the other EEC countries are more understanding of their coal industries. Belgium provides a subsidy of £24 per tonne, with production costs of £56 a tonne. France provides a subsidy of £14 a tonne, with production costs of £42 per tonne. Germany provides a subsidy of £ 12 a tonne, with production costs of £ 40 a tonne. Britain provides a subsidy of £1 a tonne. I am sure that the mining industries of other countries are equally poised and vibrant. They are poised to export to Britain the coal that we shall fail to produce.
  It is easy to close a colliery—it can be closed within a few months—but to open a colliery takes about 14 years. The Minister said that pit closure was the responsibility of the NCB. If he pushes the board into that responsibility, and if it is forced to close mines purely and simply for financial reasons, there will be no replacement capacity. What do the Government expect of the NCB if the financial restrictions are not met within three years? Do they expect uneconomic pits to be closed? If so, from where will the replacement capacity come?
  I shall quote from the NCB's comments on the report of the House of Lords Select Comittee on coal.
  "We recognise of course that the industry has a major role in determining its own long-term objectives, and that indeed is the policy we have adopted in putting forward Plan 2000, the main elements of which were summarised in Coal for the Future. However, energy in general—and coal in particular—has very long investment lead times. It will only be possible for the coal industry to succeed in meeting its forward objectives against a background of consitent ongoing Government (and EEC) support in terms of general energy policy, specific coal policy measures and investment funding."
  It continued:
  "The industry needs to be able to generate some 4 million tons a year of new and replacement capacity in the latter part

  841
  of the century. After allowing for the closure of old capacity, such a rate of new development would enable the industry to show continuing net expansion and progressive improvement in productivity and competitiveness. If the country is to have the long-term benefits of an expanded and efficient coal industry, it will be essential to maintain the continuity of the investment programme."
  That indicates that the board was worried about the financial restrictions placed upon it for the next three years. It continued:
  "It remains the Board's view that it will be highly desirable, on grounds of national energy policy, to provide for a significant increase in the use of coal from the mid-1980s".
  The NCB and the miners have always accepted a challenge. No doubt they will accept the challenge that is being thrown down now.
  We are worried that only people from the coal industry recognise that the challenge will be too much. That does not take away anything from the industry. People from the industry know what has happened in the past, and what will happen in the future.
  The Financial Times on 17 June said:
  "Until the new mines, and the 87 existing collieries which are being expensively but slowly mechanised and refurbished, begin to make a substantial contribution to coal output, management will have only two options in striving to meet the Government's breakeven target, it will either have to accelerate the closure of uneconomic pits or to raise prices.
  The Government has pointedly refused to give any indication of whether it expects the NCB to bring forward its programme of pit closures."
  A report from a colliery stated:
  "The impression has been given that the Germans, Belgians, people like this, have a dynamic force of miners compared with our own turning out this tremendous coal. And they're not, they're not different at all. But they have governments who can see the commonsense policy of applying a subsidy to carry an energy industry through a time of recession so that they are not dependent ever on other nations."
  If those nations can do it, why cannot we do it?
  While we accept the challenge thrown down by the Government, while we accept what the Government have said about the financial conditions, and while we know what those financial restraints will mean to the coal industry, we will not
  842
  accept the closure of uneconomic collieries. We will not accept that the Government's financial restraints will put the NCB in that position. We will not accept the enforced redundancies and unemployment that will be created by the Government's measure. We will not accept seeing the industry ground down, as we watched the steel industry ground down, because of the Government's policies. If that has to be, so be it. But we shall stand shoulder to shoulder and fight for the industry and the country that we love.
  6.30 pm
  Mr. T. H. H. Skeet: The hon. Member for Penistone (Mr. McKay) made a moving and interesting speech. However, I should like to refer to the speech of the right hon. Member for Plymouth, Devonport (Dr. Owen), who made two major points. The first was that the industry was not serviced with adequate borrowing powers. Perhaps the right hon. Gentleman will reflect on the fact that under the Coal Industry Act 1965 borrowing went up from £1,800 million to £2,600 million—an addition of £800 million. Under the Bill it goes up by £1.6 billion. Surely the NCB's borrowing requirements, as provided under the Bill, are ample.
  Mr. John Evans: The hon. Gentleman is not comparing like with like.
  Mr. Skeet: I am comparing like with like. I am expressing it in money terms, but even in real terms the increase is considerable.
  The other substantial point made by the right hon. Gentleman was that under the new regime the NCB could not live within its prescribed limits. He went on to indicate—I have heard it from him, and many other people, before—that subsidies to European industries, such as those in Germany, France and Belgium, are very much higher than those in the United Kingdom. It is unique that the right hon. Gentleman should use that argument. Between 1975–76 and 1978–79—at the time of a Labour Government—operational grants in the United Kingdom were nil in the first year, roughly £11 million in the next year, £24 million in the following year and £ 117.7 million in the final year. Operational grants have not tended to fall. They have gone up significantly, and in recent years they

  843
  have tended to escalate. Surely the Government are right to ask the NCB to be viable.
  I turn to the social grants, which are being continued. In 1974–75 they amounted to £119 million in round figures. In the ensuing year they amounted to £72·4 million. The year after that they were £43·4 million, and they were £51 million the following year. The trend has been on the social side, where the grants have remained relatively consistent, and it is perfectly right that they should continue. It is, therefore, extraordinary to discover that the right hon. Gentleman is advocating that the operational grants should be continued, because during the period of the previous Government he did not give substantial operational grants to the industry.
  The social grants are to be continued as heretofore. We in Parliament must look after the general situation with regard to public expenditure. It is extraordinary that this industry is providing little money of its own. In fact, if one looks at its accounts one finds that very little is being provided by the NCB. It must all come from exterior borrowings. The figures that I cited in Committee reveal that between April 1973 and March 1979 only about 4 per cent. of the total was provided from internal sources, with all the rest coming from outside. Does anyone argue that we should not act as custodians of the public and indicate that certain safeguards should be prescribed? That is what we have done here.
  The three largest borrowers are the British Steel Corporation, British Rail and the NCB. NCB expenditure in 1979–80 was £604 million, including Government grants of £172 million. In 1980–81 it is £834 million, including Government grants of £253 million. The point is that the NCB is not being deprived. The miners are not being denigrated. They are being assisted by almost £1 billion a year. It is building up towards that figure. The Minister and my right hon. Friend are determined that the miners will remain the kings of industrial workers. They are receiving more than £100 a week for doing a job which many hon. Members are not prepared to do themselves.
  I am saying that the NCB should periodically come back to the House so that
  844
  hon. Members may vet or monitor its expenditure as it moves ahead through its 10-year "Plan for Coal" to see whether the money is well spent.
  Mr. John Evans: No Labour Member would object in the slightest to the NCB or any other nationalised industry coming to the House so that we could discuss its spending programmes. I am interested in the hon. Gentleman's arguments about the finance that is made available to the NCB by the Exchequer. He seems to be rather querulous about that. He is a well-known supporter of the nuclear lobby, and he seems to swallow with equanimity the fact that we are talking about a £20 billion-plus programme for the nuclear power industry over the next decade. However, it seems to me that his arguments in that regard do not square with his arguments in this case.
  Mr, Skeet: I am afraid that the hon. Gentleman is wrong. I believe that a balance of fuels must be available to the CEGB and the South of Scotland Electricity Board. At the present time, 70 per cent. of the CEGB's output is supplied by coal, and about 13 per cent. of total electricity comes from nuclear power. The nuclear side must be built up. In my judgment, coal will not be available in sufficient quantities when it is required. We must also bear in mind that the number of fatalities in nuclear power stations is negligible, whereas the number connected with the mining industry is quite substantial, even now.
  Mrs. Elaine Kellett-Bowman: Does my hon. Friend agree that coal is far too valuable a substance to use in this way? It must be used as a feedstock. It is far too valuable to burn just to produce electricity.
  Mr. Skeet: Something that I shall say in a few moments will indicate that I can see only with difficulty the market for coal. As I am an enthusiast for the coal industry, I am prepared to ensure that it has a reasonable market in future. However, before leaving the subject of borrowing, I should point out that the £2,600 million is likely to be exceeded in 1981–82. The Bill provides enough money to cover the board's borrowing right up to 1985, and I would have thought that that was ample.
  This is a unique occasion to monitor the performance of the "Plan for Coal"

  845
  that was brought forward in 1974. We have now reached 1980, and we have learnt a significant fact. In percentage terms, coal's price advantage over oil in 1974—that is, after world oil prices went up—was 51 per cent. By early 1979 that had declined to 14 per cent. As a result of recent oil price rises, that advantage will have increased again, but one cannot help notice the narrowing of that advantage. As I have indicated, it has a habit of deteriorating as coal pursues the price of oil. Although a State monopoly, there is unequivocal evidence that the NCB is controlled by the market, whether or not it recognises that point.
  Mr. Peter Hardy Mr. Peter Hardy (Rother Valley) rose—
  Mr. Skeet: I have given way quite considerably, and I should like to advance my argument a little further.
  Under the "Plan for Coal", initial expenditure in 1974 or thereabouts was £1,400 million. The amount spent to the end of March 1980 was £1,900 million, at 1979ߝ80 prices. If one works on exactly the same price basis, total expenditure for the planned period will be £5·7 billion, and we have virtually gone halfway through the period. What have we got for it?
  I turn to annual production of coal. I shall be absolutely fair and take a period of three years. In 1973 production was 132 million tonnes. In 1974, because of disruption, it was 110 million tonnes, and in 1975 it was 128 million tonnes. It was high. Today we have production of roughly 122·4 million tons. Therefore, production has come down—[Hon. Members: "There are fewer pits".]—probably in recognition of market conditions.
  Output per man shift is another significant point. In May 1974 it was 2·26 tonnes. In April 1980 it was 2·27 tonnes. Therefore, there has not been an enormous change. The last significant advance forward was at the time of Lord Robens, when output went up substantially through mechanisation. We look forward to the time when it can rise again, but it may take some time to reach that point.
  It is interesting to note the differences between 1940 and 1980. I refer to the
  846
  average cash earnings. In the heady days of October 1974 average earnings were £50 per week. In October 1979 the rate went up to £112. The average mining costs per tonne were £11·79. In 1978–79 the cost went up to £24·10. The average price of coal to large industrial consumers was £ 9.6 a tonne. It went up to £ 27 a tonne in 1979. It trebled in price.
  What we have learnt so far is this: production has gone down, the amount of investment has gone up, and earnings have escalated considerably. Has the nation derived benefit from this large investment in the industry?
  Mr. Allen McKay: Will the hon. Gentleman take into consideration the provisional results for 1979–80? Deep-mined output is up by 3·8 million tonnes to 109 million tonnes. That is the first increase on a previous year since 1963. Productivity of all mine workers is up by 1·5 per cent., and in the last three months it is 4 per cent. higher, making an overall output per man shift of 2·7 tonnes. There has been record breaking productivity at the coalface, with a breakthrough of more than 9 tonnes per man shift since last November. The attendance at work has improved and accidents have decreased. That is no mean achievement in the mining industry.
  Mr. Skeet: That does not persuade me, as the hon. Gentleman knows. He says that there must be no closure of uneconomic pits. He knows perfectly well that in South Wales only four mines out of 38 had an OMS of over 2·3 tonnes. This is the right solution. I am in favour of phasing out pits only if new ones can be phased in. Taking the Western region, Silverdale has an output of 4·4 tonnes per man shift. In the South Midlands, at Ragworth output is 4·8 tonnes per man shift. At Daw Mill it is 4·8 tonnes and in North Nottinghamshire, at Thoresby, the output is 4·7 tonnes.
  That is the way to make a profitable National Ooal Board. That is the way to earn high wages. However, if the productivity of the remainder in Wales—that is, excluding the four mines that are relatively profitable—is too low, one understands that the good pits are being ruined in profitability by the bad ones. The bad pits are not sufficiently profitable.

  847
  Government supporters are backing a profitable mining industry. I am delighted that we are going ahead with Selby. We must wait for the occasion, but we may be going ahead with Belvoir, in which case productivity per man shift would improve further. I give this indication for a period which has been carefully monitored. Productivity is not as good as it should be because the returns from the good pits are being reduced as a result of the returns of the bad pits. I mean bad only in relation to their return on OMS.
  The coal-oil price ratio in pence per therm in 1974 was 0·61. The provisional figure in 1980 is 0·81. That may have changed. Therefore, I do not take any great point on that.
  The inland consumption is interesting. The consumption at power stations has gone up significantly, from 67 million tonnes to 88·8 million tonnes. That is a gain of 22 million tonnes. Therefore, a special market has been provided for the major quantity of coal that is becoming available. However, coke oven consumption has gone down; and the industrial market and domestic market consumption have gone down too.
  How is it possible to have these figures with these vast injections of public funds into the industry? Taking the totality of the sources of funds that have gone into the NCB between April 1973 and March 1979, the finance that came from the internal resources of the National Coal Board was no more than 4 per cent. The rest came from borrowing from the European banks, the European Investment Bank and Government grants. The industry is providing only 4 per cent., yet the right hon. Gentleman has the audacity to say that the Government are not being fair to the miners. Are they being fair to themselves or the taxpayer, who must provide it? Money does not come like manna from Heaven.
  The right hon. Gentleman mentioned that he wanted fixed targets. The target set out in the "Plan for Coal" was about 135 million tonnes by 1985. We all hoped that that would be achieved consistent with the market. The figure for the year 2000 is about 170 million tonnes. The Minister gave these figures in a written answer on 22 July, at column 139. By 1990 the figure will be 127 million tonnes rising to 138 million tonnes. By the year
  848
  2,000 it will be 137 million to 155 million tonnes. Therefore, the official figures have declined. These figures have been taken from the 1979 energy projections, a Department of Energy paper. According to the Government's expenditure plans for 1980–81 to 1983—Cmnd. 7841—we see that the target output of 135 million tonnes, which was expected in 1985, will not be reached until probably the end of the 1980s.
  We are not doing too well on this basis. Therefore, I am giving encouragement to the miners. They are doing better. The Government are reciprocating by providing the necessary cash for development and improvement. That is not coming from the industry. However, much more improvement is required.
  I move on to a sector which is of vital importance. I am concerned about the decline in the market. I mentioned that electricity generation is substantial. It is the largest part of coal consumption. The worrying factors on the horizon, such as the fall in electricity demand and the nuclear power programme, must be accommodated. Coal imports are cheap and total 4 million tonnes per annum. Some of these imports are on long-term contracts. There is extensive pollution from power stations. Miners know that in certain areas subsidence is serious.
  We see that there is a possibility that the coking coal market will be cut back substantially because of changes in technology, such as direct reduction processes which do not use coking coal, and also the SKF plasma smelt, which is probably a process for the future. The 1979 energy projections for the domestic market indicate that it is likely to fall away to about 3 or 4 per cent. by the year 2000. These figures come from a Government publication. Although it indicates that the figure may not go quite as low as that, nevertheless the downwards trend continues.
  We may expect expansion on the industrial front, with fluidised bed combustion. I raise two points. What will industry do with the limestone slurry that is formed, and how is it proposed to reduce the capital price of the fluidised bed combuster, which is much more expensive than the conventional plant used at present? Should we not be giving much more thought to dispersions of oil and coal? This might be a useful way ahead.

  849
  We have discussed the international summit on coal, which was held recently in Italy. There will not be a great deal of joy for the United Kingdom unless other countries can take on board the earnest recommendation that prices must be competitive. Our prices are well ahead of those in Poland, Australia, South Africa and the United States. This is a worrying aspect. Therefore, the international market for coal may well expand However, it is unlikely that we shall participate in it. It might be possible for us to extend into Europe, but will our European partners buy expensive coal? They will do so only as part of a package, and if they do they will not be told by the miners that they will have to pay the highest prices.
  I am concerned about coal burn for power stations—the biggest market for coal. In 1979 that worked out to almost 89 million tonnes.
  The Minister said in a written answer on 24 April 1980 that in 1990, the figure is likely to be between 80 and 94 million tonnes. In the year 2000 the figure may be between 65 and 78 million tonnes. Those figures largely confirm the energy projections of 1979. So, the difficulty that we face is that there will be a vast expansion of the coal industry. Long lead times are involved, and the plants must be ready for expansion. The medium and short-term projections for the coal industry are not satisfactory. The National Coal Board has probably got its timing wrong, and when it expects to come into the market the sales will not be there. The Government of the day will then have to make cuts. That will be regrettable, and I hope that it will not happen.
  With regard to power stations—this is part of the evidence that was given by Professor Manners in the Vale of Belvoir inquiry in March
  "Above all else, the figures reveal with persuasive clarity that, in order to estimate with good reason a demand for power station coal in excess of 70 million to 75 million tonnes between 1985 and 1990, it is necessary to assume (a) a rate of economic growth of at, or above 2·5 per cent. per annum throughout the decade, and (b) a coal: oil price ratio wider than 0·7 in 1985 and 1990. In the light of British economic performance in recent years and decades, and of coal: oil price relativities since 1973, both appear to be very optimistic assumptions."
  850
  In his evidence, Professor Manners further said:
  "Turning to the coal: oil price ratio, my judgment is that it is unlikely to widen to anything like the differentials proposed by the Department of Energy for the period to the year 2000".
  It would pay the coal industry to listen to and take the advice of Professor Manners. I am prepared to listen to and take the advice of eminent people who advocate the contrary view. But another view is that matters are not satisfactory, and the public, many of whom will have an opportunity to read the comments of certain hon. Members, will ask whether the money is being well spent or whether the Government are putting too much into the industry at this time. We are not being parsimonious, but are we not being a little over-generous?
  7.4 pm
  Mr. Michael Welsh: I shall be as brief as possible, because I know that many hon. Members, particularly Labour Members, wish to speak.
  I shall speak in favour of the amendment, and along the same lines as my hon. Friend the Member for Penistone (Mr. McKay), who has been involved with the coal industry all his life and has seen many of its ups and downs. We hope that this is not one of the down periods. Having read the Bill, and having served on the Committee, I think that there will be another downturn for the coal mining industry unless we act now. I still believe that the Government can act differently even at this eleventh hour.
  I support the amendment, although parts of the Bill are favourable to the coal industry, and are acceptable. That is why we shall vote for the amendment but not against the Bill. Other parts of the Bill spell murder to the mining industry. That is a sincere statement. The Bill does not provide adequate borrowing powers, and it withdraws operating powers by 1983—the wrong time. It would have been far more satisfactory if the industry had been given another three or four years.
  The fact that the Bill does not provide adequate borrowing powers is not because of the outlook of Ministers; it is because of a direct instruction by the Treasury with regard to the public sector borrowing requirement. The Bill does not

  851
  basically deal with coal mining; it deals with public expenditure cuts.
  Why could not the industry break even at the end of the period envisaged by "Plan for Coal"? Why should the industry change the method of costing before the end of that period? The morale of the miners is important in the production of coal. They will accept the challenge and produce more coal if they believe that they have friends in places such as the House of Commons. They will make an effort. But if we change from historic costing to current costing we shall not receive operational grants unless there is a loss. Even this year the coal industry could be £190 million in the red. The Government would then give an operational grant, and the profit would be seen to be £90 million. If that is so, why do we not stick to historic costing, give the grants above the line, and show, correctly, a profit of £90 million?
  The Bill will help only those who are anti-coal. The hon. Member for Bedford (Mr. Skeet) said that he is pro-coal. I am sure that he supports the miners, even if he does so in a strange way.
  Mr. Skeet: I have nothing against the miners. I support them. But let them not be deceived by adulation, false information or false optimism, which may come their way in inappropriate markets.
  Mr. Welsh: Miners will accept the challenge and they will not ask for anything more than they deserve. They deserve to work and they deserve the support of the Government of the day. The borrowing power is needed because successive Governments have insisted on investment so that coal can be produced. The biggest problem besides grants is the difference in costing. There is no reason why the method should be changed to current' costing. If we accept "Plan for Coal", why change horses in midstream? Why change the method of costing?
  The miners, the National Coal Board and the industry as a whole all accept the challenge. We believe that if we continue to get help as we are at present we shall break even by 1986, but if we do not get the support in 1983 that we are now getting, what is to happen to the industry? I ask the Minister to answer that question. What will happen if the
  852
  industry is shown to be £100 million in the red and there are no grants? In those circumstances, obviously there will be very great embarrassment.
  The Minister could then say one of three things. First, he could say that the industry is £100 million in the red, that there are no more grants, and that uneconomic pits are to be closed. Secondly, he could say that the industry must sell off some of its assets—as is happening in most other nationalised industries. Thirdly, he could say that the earnings of the miners must be reduced.
  A fourth possibility would be for the Government to make further grants, but they are determined not to do that, so the Minister would have to adopt one of the three courses that I have mentioned. I warn the Government that the National Union of Mineworkers would not tolerate any of those three courses being followed. They would fight against them with all the power at their disposal.
  When the lads come to the NCB, say, in 1983 for wage increases, if the NCB says that there is no money—"It in't in t'tin"—there will be trouble. It will make the winter of 1974 look like a parson's tea party. That is not a threat and it is not a promise; it is a certainty.
  We need until 1986 the help that we are getting at present because of the borrowing that has been necessary to get the industry, shortly, into a profitable position. But if, as a result of following any of the three courses that I have mentioned, the NCB—due to circumstances beyond its control—is still approximately £100 million in the red in 1983, we hope that the Government will reconsider the question of grants.
  I ask the Minister to make the position plain to the miners. If it is the intention, in a very gentle way, to kill the mining industry, I hope that he will tell us that that is the intention. Then the miners will know where they stand. When they know where they stand they can make the necessary decision—and it may hurt a lot of people. But I hope that the Minister will give the assurance that if we are still in the red in 1983 there will be some flexibility.
  It was a great disappointment to hear that the NCB will be unable to borrow money from the EEC as in the past. The industry used to get from the European Coal and Steel Community about

  853
  $500 million equivalent a year. It is now to be reduced to $150 million. The Treasury has already written to the NCB to say that this avenue for borrowing money is to be practically closed. The NCB, therefore, is having to work in a different way from any other industry. If the NCB is to be prevented from borrowing money from the European Coal and Steel Community, there is no doubt that the industry will be put into a strait-jacket. We know that it is connected with the public sector borrowing requirement.
  It is interesting to recall that the NUM, along with the NCB, was involved with the European Coal and Steel Community years ago. Joe Gormley chaired various committees, and still does. We have been closely involved with the Community and have been able to borrow money from it at very reasonable rates. Now, unfortunately, that door its being closed.
  The regional grants are also being stopped. Labour and Conservative Governments have not applied for many regional grants in the past, but they are now to cease altogether. If the Bill is passed as it stands at present, no Secretary of State will have the opportunity to get those grants. It is a mean, nasty and brutish attitude to take, because the grants were intended to enable people in the industry to live a better life. It would seem that the intention is that once again they are to be condemned to live in rough areas, while the people represented by Conservative Members are able to live in the beautiful rural areas. That is what makes this such a horrid Bill.
  A political party that forces the NCB, in one way or another, to close its mines,—especially as there will be unsatisfied needs that production could supply—does not deserve to survive. The NUM and the Opposition will do all they can to amend the Bill when we have a new Labour Government in the very near future.
  7.18 pm
  Mr. Peter Hardy: I shall endeavour to make a short speech, but I feel that it is necessary to express a degree of despair about Government policy—not merely about their energy policy but about their complete disregard for the national need.
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  Earlier today we had a statement on agriculture, and the Bill shows the same sort of disregard of national requirements. I was called by Mr. Speaker, and I suggested that in Britain we were supine in our response to national need, whereas our Community partners vigorously pursued their own national interest. In the same way, they now vigorously pursue their national interest in terms of support for mining.
  I deeply regret that the hon. Member for Bedford (Mr. Skeet) would not give way to me during his speech. I always listen to him with interest, and always become more and more convinced that there is a good case for presenting our speeches for publication, so that other hon. Members do not have to listen to them. However, I listened to the hon. Gentleman. One thing that he said will be of considerable interest to the mining areas.
  The Secretary of State and the Under-Secretary of State have been reassuring the mining communities of Britain that the Bill will not prove to be a dreadful thing for them. Now the hon. Member for Bedford seems to have confirmed the. fears of those communities. He said that he felt that the miners might be led into false optimism. There is, indeed, a real divergence of view between the Government Front Bench and the hon. Gentleman. I hope that any divergence of view concerning the interpretation of the NCB's finances will be clarified by the Minister, because the hon. Gentleman's description of the NCB's contribution to its capital investment was something of a travesty. It would be appropriate for the Minister—
  Mr. Skeet Mr. Skeet rose—
  Mr. Hardy: No. I am not giving way to the hon. Gentleman. He did not give way to me. I hope that the Minister will put that matter in proper perspective. It was wrong of the hon. Gentleman to present such a travesty of an interpretation. Of course, we all know what the Conservative Party has done to the coal mining industry.
  The position is desperate. The Conservative Government have been in power for slightly over one year, yet the damage has already been enormous. They have placed high priority on the cutting of public expenditure at almost any cost.

  855
  Money is being poured out on unemployment benefit, with all the social consequences which that brings. The social consequences of high unemployment in areas such as Wales, Scotland, the North-East and South Yorkshire are such that it is important that the industry should be given higher priority.
  Fears about the industry are not restricted to the National Union of Mine-workers. They are felt by everyone connected with the industry—whether members of the NUM, its local leaders, members of the National Association of Colliery Overmen, Deputies and Shotfirers, to which my father belonged for many years, or the British Association of Colliery Management.
  My hon. Friend the Member for Penistone (Mr. McKay) reminded me of the day when my father took me—I was a schoolboy—to Manvers Main colliery to see the vesting day. In those days one heard a certain amount of cynicism. I was only a boy, but I could sense a little of it. The managers of Manvers Main colliery were the managers after nationalisation. The flag changed, but the faces did not.
  Over the past 33 years management has arisen from career opportunities. The service and support that colliery managers gave to the Conservative Party 40 or 50 years ago is no longer applicable. The members of the British Association of Colliery Managers do not pay the political levy. They are part of the trade union movement, but they are not part of the Labour Party. The association has made it clear from its professional understanding of the mining industry that it is critical not of the whole of the Bill—we are not critical of the whole of it—but of the straitjacket provisions.
  I gather that the Secretary of State does not like the use of the word "strait-jacket". However, if the Government pursue lunatic policies they cannot object if we use such words.
  Mr. Skeet: Get the facts right.
  Mr. Hardy: I did not suggest that the hon. Gentleman should wear a strait-jacket. I said that the Government were pursuing lunatic policies. Usually the hon. Gentleman supports them eagerly.
  856
  The British Association of Colliery Management argues that the industry is geared to change and innovation. Productivity is on a dynamic growth course. The position is far better than some Conservative Members believe. Morale is high and absenteeism is at its lowest level for 20 years. The momentum gathered from "Plan for Coal" must not be threatened.
  The British Association of Colliery Management is not a Labour Party organisation, but it believes that certain parts of the Bill seriously undermine the growth of the coal industry. I hope that the Minister will take steps to change the present inflexible approach. The Government would show some sense if the Minister were to meet the industry on a tripartite basis in the same way as the previous Labour Government, if he spelt out to it the difficulties faced by the nation, which would not be ignored by the industry, and asked it voluntarily to respond, as it has done in the past. My hon. Friend the Member for Midlothian (Mr. Eadie) took part in all the meetings and knows that the recognition of reality is not a difficult task for the mining industry.
  If a hard and firm target is set, which the National Coal Board is obliged to meet, the board will have to be prepared to meet it and there will have to be contingency plans. There will have to be a dedication of resources and energy to meet the target. There will have to be cautious, careful and excessively prudent arrangements for drawing in the horns of investment. I hope that the Minister will give an assurance to the NCB that the present inflexibility will not be allowed to deter research into the use of coal and the development of coal technology.
  Britain is one of the world leaders in mining technology and engineering. The Government's present inflexibility must not be allowed to deter investment in projects such as Selby. The Minister knows that there is drama and glamour in oil rigs in the North Sea. He also knows that Selby is better than two of the best North Sea oil platforms and that it will remain so for at least twice as long as the best and most durable of our oilfields. It must be right for us to urge the Minister not to impose such regulations and rules on NCB finances, which

  857
  will threaten Britain's ability to cash in on the bonanza of coal, which will be 10 or 20-fold greater than the most optimistic estimate of our offshore oil resources. The assurance of flexibility is important. It would be better for the Government to reduce some of their rigidity and to give the industry the capital and the opportunity to maintain the dynamic growth that it is experiencing.
  I do not want to be critical of the Under-Secretary of State. I have heard the hon. Gentleman pay a graceful tribute to the industry. I recognise that he has made enormous efforts to understand it. It would be better if some of his hon. Friends who do not understand the industry and who have had little contact with it were to follow his example. The hon. Gentleman's exposure to the industry should have equipped him to understand the nature, mood and mentality of those who work and live in the coalfields of Britain, to understand the miners and to appreciate that he can lead but cannot drive. It is the effort to drive that is causing a great deal of anxiety.
  I have noticed the Government's inflexibility towards the coal industry. I do not see any inflexibility towards nuclear power. I have never attacked research and development into nuclear power. Britain must remain in high technology. We must ensure that future generations never face desolation. However, if the coal industry is to be placed in a strait-jacket, as is proposed in the Bill, it will be entirely wrong for us to leave no limitation and to be relaxed in our approach to the possibility of huge sums being devoted to investment especially in American nuclear technology.
  If the Minister wishes to develop and generate a massive anti-nuclear campaign, the Government are going along the right road. By telling the coal industry that it must break even by 1983, in the present muddle of nuclear policy and nuclear decision-taking, and while they play about without limit or restraint along the American road, the Government are risking the grave embarrassment of Britain and the society within it.
  I do not want to speak for too long—
  Mr. Skeet: Hear, hear.
  Mr. Hardy: I am delighted that the hon. Gentleman has been listening to my
  858
  speech. If he had not been, he would not have been annoyed.
  Mr. Skeet: I am courteous.
  Mr. Hardy: I have not taken anywhere near as long as the hon. Gentleman. I do not wish to take too long, because many of my hon. Friends wish to take part in the debate. They will be speaking as representatives of every part of the country and of every coalfield. There will be a unanimity of view. We wish to see the industry survive. It is in Britain's interests that it should do so.
  I have referred to the Under-Secretary of State's service to the industry. He has visited it and publicly paid tributes to it. Will he maintain his close contact with it? Will he ensure that he is at least able to understand the need for swift arrangements when it is necessary for them to be made? Will he continue to be aware of deteriorating events, entirely outside the industry's control, which will increase the intolerability of the pressure that the Bill places upon the industry? If the world recession worsens, and if the appalling industrial wasting continues, will the Minister ensure that the National Coal Board will not be irreparably damaged? If that were to happen, our children and their children would suffer.
  Reference has already been made to a one-legged Santa Clause. Few Labour Members believe in Father Christmas. However, we believe that the Prime Minister should be placed on top of a Christmas tree, so long as it was possible to remove the right, hon. Lady before the 12 days were over.
  Mr. Skeet: Cheap. Withdraw. The age of chivalry is not yet dead.
  Mr. Hardy: There are those who buy disposable Christmas trees. I also believe in disposable fairies. Will the Minister ensure that he maintains his contacts with the industry and that he meets the industry's representatives frequently, to ensure that a swift improvement in arrangements can be made if the recession gives rise to further difficulties? Will the Government ensure that the effort required from the National Coal Board in order to meet the timetable does not prevent investment at the 220-odd collieries that have substantial reserves? Will the Minister ensure that he does not prevent investment in the development of

  859
  new collieries, which must be working by the 1990s?
  Does the Minister accept that a carefully thought-out strategy will involve contingency plans to respond to any movement in the subsidies given by European countries? Does he accept that such a strategy will involve contingency plans in the event of the price of oil falling by a marked amount in real terms? There is anxiety that as the recession bites the price of oil will fall and cause temporary but serious consequences for world energy pricing. That could be disadvantageous to Britain.
  Will the Minister keep a close eye on recruitment? Many coalfields, including my own, face appalling problems. Recently, I spoke in the Chamber about unemployment. I am president of the youth organisations in South Yorkshire. I am deeply distressed about our level of unemployment. The National Coal Board is the only significant employer in my constituency that is providing constant opportunities. I should hate it to be plunged into any temporary difficulty that would make it impossible for it to maintain that contribution. Without it, heaven knows what would happen! In South Wales, such a position may already have been reached.
  Will the Minister explain to the Secretary of State that we do not think that he fully understands the length of lead times in mining development. He seems to imagine that the NCB can break even in two years' time. The Minister understands that lead times are enormous. That is unavoidable. Some of my hon. Friends went to the ceremony at Selby, when the first sods were removed. It was a great occasion, because for a decade or more we had argued that such development was essential. However, it will be 1984 or 1985 before full production is achieved. It will have been worth the investment. The Under-Secretary realises this. I am not convinced that the Secretary of State understands it.
  I have asked the Minister to answer several questions. The most important question that has been asked was that which was asked by another hon. Member in relation to the travesty of media interpretation. Several of my hon. Friends were miners. They are perhaps too modest to say that the national media's main interest is in the comments and actions
  860
  of one or two miners' leaders. Such men are able, colourful and perhaps controversial.
  Mr. Welsh: Moderates.
  Mr. Hardy: I do not wish to enter into a controversy with my hon. Friend. The hon. Member for Bedford probably takes an interest in the comments only of the colourful and controversial leaders. Recently, little attention has been given to reality. Despite the potential onslaught on coal, and despite the history of the past.10 or 40 years, the industry has been a national success. Our coal is not quarried; it is deep-mined. It is the most successfully deep-mined coal in Western Europe. Production by volume and by method is a success story. Last year, 4 million more tonnes were mined than in the year before.
  The coal industry is a family industry. No outside entrepreneur, city slicker or wide boy from the South-East has taken charge of the industry. The achievements have been the achievements of a family. Those who lead the industry were developed and trained in it. From time to time cynical words may have been spoken. Sometimes, there may have been abrasive comments and actions. However, although cynical words may have been expressed in the industry, Britain's position is not disdained. Conservative Members may not have appreciated certain forms of the industry's determination. However the national need has been served.
  Conservative Members always draw attention to miners' pay. The hon. Member for Bradford spoke about earnings of £100 a week. I would not go down a pit for £100; nor would the hon. Gentleman. Miners should be rewarded. This nation could have the greatest reward, and we shall be rewarded if our energy needs are met. That will be an important reward. However, our energy needs will not be met unless they are met by our principal present and future energy resource, namely, coal. Coal and the coal mining industry are too essential to be put in jeopardy by short-term calculations that seek to meet silly public expenditure targets.
  7.37 pm
  Mr. Edward Rowlands: It is a pity that a Bill that deals

  861
  with borrowing powers and the industry's increasing financial requirements should lead to a Division. We must explain why we intend to divide the House and why we oppose aspects of the Bill.
  This Bill is part of something else. It is part and parcel of a myopic financial view of the industry, and of its development. The industry is not being developed and expanded in the way that it could, and should be. It will suffer from artificial, cramping, financial limits imposed not in the interest of the industry's development, but for other reasons.
  Our second reason for dividing the House is that many parts of the coal industry can already see the effects of the Government's policy. They can see the consequences of the Government's attitude. That attitude is not only reflected in this Bill, but in the Government's stand-off policy towards the industry and its problems. They hold that attitude at the very moment when the industry needs the maximum degree of support, sympathy, and effort and the co-operation of the NCB, the National Union of Mineworkers and the Government.
  It has been suggested that we should strike notes of optimism and that we should preach the gospel of the industry's future. I share that view passionately. The Government's actions and indications have destroyed the optimism.
  We have never talked down our industry or our coalfields. However, now we must talk about the profound issues which face the industry. I shall concentrate on the South Wales coalfield. Its situation reflects the way in which Government policy will work through and affect the industry. Our fear is that the South Wales coalfield will bear the brunt of the Government's Scrooge-like approach to the industry. Anger is beginning to come from the coalfield. People are asking what they can do because they cannot depend on the Government. They go to see the Secretary of State and are greeted with a "No". They do not even get a sympathetic "No". A strategy was being evolved. The Government, the NCB and the NUM started to think through the problems. They published their thoughts in a document from the tripartite group of the South-West coalfield sub-committee. It did not come to
  862
  final conclusions but described the problems and paved the way for thinking through to a solution.
  The last four or five years have told a remarkable story. About £140 million of capital has been invested in pits, some like the one in my constituency which is nearly 100 years old. That investment has made it easier to get the coal out and to market it. As a result, productivity is rising. The cost of producing coal in South Wales is heavy because South Wales has an old and traditional coalfield. Seams are sunk as much as 600 feet down and a mile or two away from the base of a pithead. The last four or five years has been a period of modernisation and investment. With that has come change. The idea that miners are Luddites and opposed to change is nonsense.
  The Secretary of State told us about the cruel period of the 1950s and 1960s. Even in the 1970s a dozen pits in the South Wales coalfield were closed by agreement. It was proved to the NUM that the coal reserves were unobtainable or could not be reached in meaningful quantities at reasonable cost. The plan resulting from the tripartite talks was that as the problems of an old coalfield developed and the costs grew, a new coalfield would be developed. The plan was that two major new investments should be made to give the coalfield a future. The first element of the plan was that the enormous Margam coalfield, on the fringe of the constituency represented by my hon. Friend the Member for Ogmore (Mr. Powell), should be developed. That coalfield has 100 million tonnes of coal. It is a marvellous coalfield. Clustered around it is a group of traditional pits which still extract coal. The idea was that in the next seven or eight years—
  Mr. Skeet: Will the hon. Gentleman give way?
  Mr. Rowlands: So many of my hon. Friends wish to speak that I shall not give way. I should like to deploy my argument. I listened patiently to the hon. Gentleman's half-hour speech.
  By following the plan we could have tackled, gradually and sensibly, the problems caused by exhausted seams and geological difficulties in some of our older collieries. We could have transferred, socially, economically and industrially,

  863
  the experience of the individual miners and mining communities from the old coalfield to the new.
  The second part of the strategy involved the development of the new Phurnacite plant at Aberaman. That would have given a long-term future to the pits that serve it. It would also have established continuity in the nation's need for smokeless fuel. From that plant comes the whole of Britain's smokeless fuel production. If it closes down we shall have to import £50 million worth of smokeless fuel.
  That was the plan. We could have gradually and sensitively made the change. We could have ensured that we did not lose our skills and experience. We could have ensured that pits were not closed unnecessarily. We could have brought in new investment to coincide with the decline and closure of the oldest pits. That plan is now in grave danger. We need continuity of development, time and investment. The Government will give us none of that if they continue their policies, which are capable of destroying hope in the South Wales coalfield. The spectre of redundancies looms large.
  Reference has been made to recruitment. For the first time South Wales has stopped recruiting young apprentices. That is how we shall lose our young miners and the tradition of mining communities. Many communities are faced with the prospect of valleys littered with derelict pits and pitheads, and the slag heaps that go with them. Why? Alongside the Government's policy have come bolts out of the blue which have damaged the prospects of our coalfield. The first was the action by the British Steel Corporation. Its decisions on capacity had a profound effect. More tragic was its decision to buy coal from America. It bought 1 million tonnes and thereby removed from the South Wales coalfield that amount of the market overnight.
  I have heard firm stories that a BSC market man is in the United States considering buying more coal. That is a disaster for the South Wales coalfield. The Government say that it is nothing to do with them. We begged the Under-Secretary of State to take action on the Aberaman plant and the import of coking coal. We begged and pleaded with him. We did not have tea. We had sympathy but no action. The National Coal Board,
  864
  at great expense, sorted out a short-term deal with the BSC to save one half of its market with the BSC.
  The Government argue that the BSC is entitled to buy coal at any price. They say that if it can purchase fast, cheap American coal, good luck to it. They say that the market is free and that they must not interfere. I wonder why that principle was not applied elsewhere in South Wales? A month or two ago the potato producers in South Wales were faced with the prospect of being flooded with cheap potatoes from other countries. That was an obvious advantage to the British consumer. Like a flash the Government intervened and said "We must limit the quotas and cut imports because they damage the long-term prospects of the potato producers". Why is it that the Government can act in such a situation, at the expense of British consumers, but not intervene to save the Welsh coalfield from the BSC decision to import coal from America?
  In political and economic terms there is no difference between the two. However, there is not a single pit in Pembrokeshire, Croydon, Guildford or Finchley. There is not a single Conservative Member here with a coalfield in his constituency. There is, therefore, no political interest or clout. I do not wish to be cynical, but we cannot compete with American coal even if we close a dozen Welsh pits tomorrow, halve miners' pay, destroy the power of the NUM or emasculate the NCB. In West Virginia coal is scraped off the surface. It is shipped out in bulk. There is no way in which even the most efficient British coalfield can compete with such production.
  We shall never be able to compete, but we should not therefore conclude that we have to become dependent on that coal. The British Steel Corporation is in grave danger of depending wholly on foreign imports. In theory, North Sea oil could not compete with southern European or Kuwait oil, as our production costs are much greater. However, I repeat that we must not depend on foreign imports for our energy sources. That is one lesson that the oil sheikhs should have taught us.
  The strategy and plan of sensitive development in the South Wales coalfield will be destroyed by those imports. If

  865
  the Government continue to pursue a policy of short-term, myopic financial control over the coalfield, the consequences will be strange. The Minister is unlikely to broadcast this fact. The highest cost pits are the anthracite pits of West Wales. If the NCB is driven to make stupid, artificial, short-term financial decisions, the pits of Carnhedryn and Abernant, and the only anthracite coalfield in the country, will shortly have to be closed. That is no reflection on the miners or the board, but it is extremely difficult to get that coal. The cost is a heavy burden on the board's finances. It could be driven to the absurdity of having to close one of the most important and valuable coalfields in the United Kingdom. That illustrates the nonsense of the Government's myopic view.
  It is sad that the Government spend much of their time portraying nationalised industries as beggars, crawling on their knees—industries which have to be rapped on the knuckles for suggesting that there should be higher financial limits. Every other European country is willing to give its coal industry increasing subsidies to maintain and develop coalfields. European countries allowed the industry to run down very badly, but at least they have learnt their lesson. The West Germans are determined not to forget it. The problem is that they cannot find miners, because the mining communities have disappeared. We are in grave danger of the same thing happening in South Wales.
  While languidly draped over the Dispatch Box the Secretary of State had the gall to refer to the large number of pit closures in the period between 1966 and 1968. I was in the House at that time. As has been movingly described, the miners had then come to the conclusion that there was no future in the industry and that oil was king. They were convinced that they could not hope for better wages and that they had to accept rationalisation. The result was the closure of many pits in South Wales. We now realise that many of those pits should not have been closed, but we have learnt our lesson. In 1974–75 we produced the tripartite strategy and a plan for coal, involving investment development. The worst, oldest and geologically faulty pits were closed, but at the same time there was
  866
  development and expansion. The Government have put those plans in jeopardy. They are myopic, but even worse, they do not want to learn the lessons of the 1950s and 1960s.
  7.57 pm
  Mr. Lawrence Cunliffe: I regret that the hon. Member for Bedford (Mr. Skeet) is not in the Chamber. He attempted a statistical slug-out over increases in productivity reflecting unit costs. In Committee he consistently distorted beyond recognition the facts, figures and image of our mining industry. It is claimed that Labour Members are too pessimistic about the future of our mining industry, but the Government are seeking to tie the hands of the NCB and the mining industry in the name of monetarism. I should relish the opportunity to deal with many of the incorrect points made by the hon. Gentleman, but I shall deal with only two.
  The hon. Gentleman spoke of falling demand for British coal consumption. The recession that has occurred through the Government's actions has affected demand for coal. The Government continually tell us that industry must stand on its own feet, but demand has decreased and investment has been cut back. Every day there are factory closures, especially in the North-East and the North-West. National and local investors, and those from abroad, lack confidence in the Government's attempt to stimulate the economy, as they promised in their manifesto, in order to increase our standard of living.
  It is a myth to claim that the British workman is responsible for the problems and that he is lazy and indifferent to his task. That is certainly not true in the mining industry, as has been proved by a magnificent year of profits, increased productivity, decreased absenteeism and increased exports. There is a tremendous spin-off from the mining industry to the rest of British industry.
  We constantly use the slogan "Buy British", and it is the proud achievement of the National Coal Board that 98 per cent. of all the goods and materials that it uses are British made. We must learn that investment in one industry has major consequences in helping others to become more viable and efficient.

  867
  The Secretary of State referred to the Venice summit. He stressed the reaffirmation by Britain of the energy requirements to be met by the year 2000. We challenged the Government at the second sitting of the Committee and claimed that the Bill should be reappraised in the light of the summit meeting. We said that the Government should step back from the financial obstinacy that they were sustaining by being inflexible over the phasing out of operating grants.
  The House must realise that we cannot turn back the clock, as the Government are attempting to do with the NCB's balance sheets. They intend to mark back the books, so that a break-even result can show a loss of £190 million. That is political chicanery, trickery and deception.
  I am sure that the Government and the Prime Minister have failed abysmally to understand the magnitude of the problem of world energy requirements. They show a degree of indifference when they have to put their money where their mouths are. It was pointless for them to pay lip-service to a commitment to double coal production when they were imposing on the British mining industry the financial impediments contained in the Bill.
  If the Government want to restore the confidence of men and managers in the industry they should pump greater investment and aid into the industry instead of merely talking about the possibility of reappraising the situation in the autumn. With all the drive and determination in the world, the NCB could not break even by the dates laid down in the Bill.
  It has been said that we should make ourselves more competitive by increasing production and reducing unit costs, but many of our pits are uneconomic because of natural geological conditions and not because of any lack of effort by miners. It is ridiculous for the hon. Member for Bedford to compare unit costs and production norms in areas like the rich coalfields of Nottingham, with their 6ft. and 7ft. seams, with my part of the country, where we have small collieries with only 18in. seams, and where the men still have to crawl on their bellies and the pits have no mechanisation. Even so, they meet their production targets and,
  868
  since the new productivity deal, the men earn reasonable wages.
  Those men come from mining stock and mining communities. The great danger, as my hon. Friend the Member for Merthy Tydfil (Mr. Rowlands) pointed out, is that if we are not careful there will be no mining stock left to go down the pits when we experience a resurgence of demand for coal. It is all very well to say that we need mobility of labour, but some miners in my part of the country have already moved four or five times from region to region. They have said "Enough is enough. We are not risking the education of our children and moving home again. We will go on the dole before we move." Passions and emotions of that sort are being generated in the region. Those men cannot be moved like industrial nomads whenever it suits some economic objective. It is an inhuman process at the best of times.
  We acclaim the increase in the amount allocated to the pneumoconiosis compensation scheme, as do the miners. However, compensation cannot make up for the death of a miner whose family have seen the scourge of the disease and its effect on the body. Some of us believe that we should abolish the pneumoconiosis panels. The evidence of general practitioners, pathologists, and consultants who have kown and examined men for many years is rejected by the panels. One cannot convince the widow of a miner who was receiving a 60 or 70 per cent.—sometimes even a 100 per cent.—disability payment that a post mortem decision that her husband had chronic bronchitis is correct No rhetoric, persuasion or compassion can convince her that her husband did not suffer from the terrible disease of pneumoconosis.
  I have had responsibility for rehabilitating many sufferers at NCB engineering services workshops. It is a thankless task to have to watch them deteriorate. It is a progressive disease that eats the lungs away, and even if we doubled the amount of compensation it would not ease the feelings of the widows and families who have seen their men suffer. I make a plea that at some time in the future we should consider a more human approach to some of the problems involved in this area.
  British miners view the present situation with some anger and suspicion. The Under-Secretary satisfied the Opposition

  869
  with his reasonable approach to some matters in Committee, but it was obvious that he did not have much leeway and was in a straitjacket. Unless confidence is restored to the mining industry, backed by hard financial investment, better conditions and better remuneration, we shall never reach the commitment that we have made to double production by the year 2000 within the EEC terms and the Venice summit.
  8.10 pm
  Dr. Roger Thomas: It is a great privilege to follow the oration by my hon. Friend the Member for Leigh (Mr. Cunliffe) who, with his expertise, made some telling contributions in Committee. His case tonight, proposed with conviction, was irresistible.
  In the wake of the double blow of the recession of 1973 and the oil prices of 1974, the Government and the country turned back to coal after the unhappy record of the 1960s. Even though British mines could provide adequate supplies for our own basic needs, both the Central Electricity Generating Board and, in particular, the British Steel Corporation, have been allowed to import coal. Even during the early years of "Plan for Coal" which saw a major turnaround in investment in our indigenous industry, oil-fired power stations actually increased their proportion and contribution for pre-1973–74 decisions to be carried out. There was, about that time, a hesitancy in the Government's commitment to coal. I gather daily the impression that this hesitancy is fast returning. There is daily evidence coming to light to support this view.
  The greater the output and commitment to coal, the less will be the demand upon our far from limitless supplies of oil and natural gas. It is natural and rational to insist that future power stations could be run on coal—and on indigenous coal at that. Plans to convert oil-fired power stations to coal should be expedited. This would mean that the depletion rate of offshore oil and gas could be handled far more effectively. The great boon to our economy would not be frittered away too hastily. This can be achieved only by a commitment to coal that is above the figure envisaged by the Government over the coming decade.
  870
  The Government have also deliberately loosened their grip and control over North Sea oil instead of extending their interests into allied oil processing industries, the result being a far more curtailed advantage for the British people. It is now clear that the Government are determined to streamline the coal industry so that it all falls within the category of well-designed, well-equipped, highly mechanised, high-productivity mining capacity. If that is the case, further contraction is bound to occur.
  The Prime Minister, in her famous speech at Swansea last week, more or less told the Welsh workers—the Welsh miners were not excluded—that, if they wish to play a vital part in the industry, they will have to be prepared to be mobile. That mobility would not be confined to moving from pit to pit within South Wales but would mean being prepared to move to the geologically lucrative mines that extract coal east of the Pennines. This amounts, unfortunately, to a further piece of evidence that the Government do not really care for Wales. Neither do they appear to care very much more for the other long standing, less prosperous regions that contain the more perilous parts of the peripheral coalfields of the United Kingdom.
  The slump of 1973 followed by the oil crisis of 1974 marked a turning point for our energy policy as much as for our economic policy in general. Nuclear power is said to be cheaper than power from coal-fired stations, but the CEGB is not fully forthcoming with the essential statistics on relative costs. Further comparison is difficult when the former is technically a continuous process and the latter are used for the variable part of the required load. A statement such as that from the chairman of the CEGB to the effect that up to the end of March 1978 the electricity consumer will have saved, through present nuclear capacity, up to £ 100 million, compared with the costs of alternative coal-fired stations, is hardly calculated to help the coal mining industry to assist this country to use its reserves of fossilised fuels to the full.
  Yet, in a parliamentary reply on 23 April, the Department of Energy stated:
  "Current research should enable disposal routes to be developed before the end of the century."— [Official Report, 23 April 1980; Vol. 984, c. 173].

  871
  The operative word is "should". There is no element of certainty in the Minister's reply. It has to be taken on trust that the safe management and disposal of nuclear waste to which both the Government and the nuclear industry are giving their highest priority will provide that degree of total safety that our people deserve and demand.
  In 1979–80, the domestic market apparently became the coal industry's second largest after many years of decline. Sales of domestic solid fuel appliances are certainly increasing as oil becomes prohibitively expensive. We have an advisory service second to none. Yet there is a mounting fear that coal supplies for these families, who have now been convinced that their homes should be heated by coal, will come from outside the British Isles. This is a distressing and despicable situation if it is allowed to develop.
  In the anthracite areas of the South Wales coalfield, where geological unpredictabilities are gathering momentum, supplying new domestic and, to a lesser extent, industrial consumers will result either in importation or resorting to opencast methods of coal extraction, a method that is wholly unacceptable unless more concessions are forthcoming both in regard to the relative disturbances between blasting and occupied dwellings, the desecration of the countryside to resemble parts of distant planets, and we have the long overdue improvement of transportation, with more reliance upon rail and far less upon inadequate roads, both in quality and upkeep.
  For the domestic consumer, energy is now a very costly item. The recent price increases have hit the low-paid and the pensioners very badly. Their fuel bills form over 12 per cent. of their living costs compared with a third of that percentage for those with higher incomes.
  I remind the Under-Secretary, whose placatory tones and conciliatory nature we witnessed during the Committee stage, of his final contribution to that Committee stage, in which he said:
  "I see no reason why I should not initiate a form of tripartite debate immediately"— [Official Report, Standing Committee B, 15 July 1980; c. 327.]
  This is something that we wish the Secretary of State to carry out.
  8.19 pm
  Mr. Ray Powell: Having listened to my hon. Friends I can safely say that although over past weeks we continually win the arguments we lose the votes. On the crucial issue of coal and energy and this Bill, the Conservatives have been able to field two supporting speakers whereas the Labour Benches could continue all night.
  Sir Anthony Meyer rose—
  Mr. Powell: I have no wish to give way. Let me start first. The hon. Gentleman will have an opportunity to address the House. He may interject later. I am sure that he will have a lot more to interject before I have concluded.
  I am the son of a miner. My hon. Friend the Member for Leigh (Mr. Cunliffe) referred to pneumoconiosis, which is covered in the Bill. An extra £7 million will be allocated in payment for pneumoconiosis sufferers in the mining industry. My father died from pneumoconiosis 25 years ago, but he was not compensated. My mother was one of the widows referred to by my hon. Friend who was searching for compensation. We are not going back to what happened 25 years ago, but we shall not progress favourably with the Government's proposals. Does the hon. Gentleman wish to intervene now?
  Sir A. Meyer: I was merely going to say that, although I had to be absent for part of the debate, I expected that we would witness a truly united onslaught of all Members representing Welsh Labour mining constituencies. From what I have been able to make out, there have not been more than four Welsh Members present. That is hardly the overwhelming onslaught that we expected.
  Mr. Powell: I am surprised that the hon. Gentleman should interject in that fashion. I have been here since the start of the debate. I went to the toilet, so I might have missed the hon. Gentleman then. He may have been in his place then. But he has not been here throughout the debate. Therefore, how can he know how many Welsh Members have been in the Chamber? Most of the Welsh Members representing mining areas have been in the Chamber tonight. They declared their intention of allowing most of the sponsored NUM Members to speak

  873
  first and then for others with mining interests, such as mine in Ogmore, to speak in the later part of the debate. I cannot see why the hon. Gentleman was so eager to speak. Five Labour Members still wish to speak.
  Mr. Skinner: They have been boozing all day.
  Mr. Powell: I listened to the speech by the hon. Member for Bedford (Mr. Skeet), but I could not follow his argument. He reminded me of a colliery manager in the Rhondda, who used to hold his thumb in his waistcoat pocket and speak with an accent similar to the hon. Gentleman's, but he had never been down the mine.
  Mrs. Kellett-Bowman: My hon. Friend has.
  Mr. Powell: I wonder whether he ever worked in a 2ft. 6in. seam. It would not appear from his accent that he had ever worked in a colliery.
  The Minister stated that the Government could give the necessary assistance to sustain a viable local industry. The National Coal Board cannot live within these cash limits. The NUM said that it could not live within this financial strait-jacket. We know of the difficulties that the NCB and the NUM would have if the board had to live within this financial straitjacket.
  We should be planning a fuel policy that will not only meet the requirements of today but will match the needs of tomorrow. It was easy for hon. Gentlemen to intervene when the Minister referred to the closures and rundown in the mid-1960s. Many Labour Members objected strongly. However, it is still reasonable for Opposition Members to refer to the coal industry that the Conservative Government inherited 14 months ago.
  The United Kingdom coal industry is the largest in Western Europe and one of the most technologically advanced in the world. Annually, only 1 million tonnes of coal are produced by private enterprise, compared with 120 million tonnes by the NCB. Last year the industry saved Britain £5 billion in foreign exchange at current oil prices. It met 40 per cent. of Britain's energy needs. The right approach by the previous Labour
  874
  Government enabled productivity to rise by 8 per cent., which was matched by increased sales in 1978–79. Coal generated three-quarters of the nation's electricity. We have estimated reserves of 45,000 million tonnes—sufficient to last 300 years at current rates of extraction.
  I have set out the success of the coal industry to the date when this Government took office. That was the state of the industry 14 months ago. I refer now to the worry, fear, and anxiety already created in the 14 months of this Tory Administration. My right hon. Friend the Member for Plymouth, Devonport (Dr. Owen) referred to the reduction of demand as a result of recession. He asked for more power to be created by coal, not oil. That would be a major step forward, which would help to solve the problem in the coal industry. That was an excellent suggestion, which the Government should consider.
  The demanning of Port Talbot alone will throw 8,000 steel workers out of work. The demand for coking coal will obviously fall. Four collieries in my constituency producing coking coal employ 4,000 workers, who will be in fear of losing their jobs. Those collieries are St. John's, the Wyndham and Western, Ogmore Valley and Falddu, in the Garus Valley. They are desperately attempting to break even or to make a profit. The closure of the collieries will mean the death of the valleys. We have seen this happen before in Wales. In the Rhondda, where I was born, there were 38 collieries in 1955. Now there is only one, and that is due to be closed.
  The Welsh miners, particularly the South Wales miners, will fight and win, if not for themselves for their children and their children's children. They fear being out of work. What jobs can be offered to the miners in Wales?
  Mr. D. N. Campbell-Savours: They can move.
  Mr. Powell: I am coming to the point about moving. They have moved from Wales in the past. Slough was considered to be a Welsh town. People went from the Welsh valleys to Slough.
  About 11,000 workers could be made redundant in and around Ogmore. We listened to the Prime Minister today saying that the Welsh unemployed should move elsewhere within Wales. My hon.

  875
  Friend the Member for Carmarthen (Dr. Thomas) referred to her speech on Saturday.
  I was at the rally on Saturday. The Prime Minister must have seen the people only through the windows of her party's pavilion in Swansea, because her supporters ushered her in through the back door and out again by the back door. Yet when she did see the people through the windows she said that she was glad that they were not on her side.
  Sir Anthony Meyer Sir Anthony Meyer rose—
  Mr. Powell: I do not intend to give way again. I know that the hon. Member for Flint, West (Sir A. Meyer) was at that conference. The Prime Minister said that she was glad that those people were not on her side. But 14 months ago she conned them into being on her side. She conned some of those trade unionists who were marching in Swansea on Saturday. She did not even bother to visit the industries and the factories that are going bust in Wales, though she was invited to do so by my hon. Friend the Member for Swansea, East (Mr. Anderson) and my right hon. Friend the Member for Swansea, West (Mr. Williams).
  The Prime Minister did not accept the challenge. She was in and out of Swansea without so much as a farewell. She simply left the message that if the unemployed wanted work in Wales they must go and find it. My advice to my constituents—and I have 16,000 to spare—is that they should move to Finchley, because if we wish to move the right hon. Lady by the democratic process we should get rid of her there.
  Sir A. Meyer: I am quite sure that the hon. Gentleman does not wish to be unfair. I know how fair-minded he is. However, the Prime Minister's comments about not wishing to have those people on her side were not directed to those taking part in the official Labour Party demonstration. She was addressing a group of extremely unruly members of the Socialist Workers Party. It was they who completely wrecked the Labour Party demonstration. I am quite certain that the hon. Gentleman would no more wish to have them on his side than would my right hon. Friend the Prime Minister.
  Mr. Powell: I took it that the Prime Minister was addressing a Tory conference. I am given to understand that it was made up mostly of out-of-work civil servants. Whether she was addressing her remarks to them I do not know, but I understood that she was referring to the demonstration and the 10,000 trade unionists who were marching.
  My right hon. Friend the Leader of the Opposition asked the Prime Minister today where the workers should move to within Wales. It was apparent that the Prime Minister did not wish the workers to move out of Wales. She wished them to move within Wales. The cry of Opposition Members was "Where in Wales will unemployed workers find jobs?"
  Mr. Skinner: How about Shotton?
  Mr. Powell: My hon. Friend the Member for Bolsover (Mr. Skinner) refers to Shotton. I was about to refer to the percentage of unemployment in my area. Fourteen months ago Ogmore was a growth area. The unemployment figure was 3.8 per cent. There was the prospect of a new Ford engine works at Bridgend. That factory was intended to employ about 2,300 people and it was to receive a subsidy of £180 million. What has happened to that project within 14 months?
  The factory will now require only 1,500 workers, and 500 of them will be redundant workers from Ford factories at Swansea and elsewhere. That means that we shall have only 1,000 new jobs in Bridgend despite the £180 million subsidy. Ogmore now has an 8·5 per cent. rate of unemployment. That means 4,500 people out of work according to last week's figure, and that total excludes 500 students. Therefore, the real total is 5,000.
  The most disappointing fact is that 5,000 people are looking for jobs and the number of registered vacancies in the Port Talbot travel-to-work area is 50. There are 50 jobs, with 5,000 people seeking them.
  Perhaps Ministers will tell us where the unemployed in my constituency will find jobs in Wales. They cannot go anywhere else. If they go to Shotton they will find that the unemployment figure there is 30 per cent. Unemployment figures are high all over Wales, with the exception of Carmarthen, which has about 3 per

  877
  cent. We asked today, where are these people to find jobs, not only in Wales but outside? The same situation exists practically all over the country.
  My hon. Friend the Member for Merthyr Tydfil (Mr. Rowlands) covered most of the points that I wished to raise about the development at Margam. This is something that the Minister should reconsider. It is important to us in Ogmore. Port Talbot and the Neath valleys. If that mine is opened and investment is put in it could accommodate a number of colliers who are in areas that are oversubscribed. I share my hon. Friend's opinion about young people who cannot get jobs in collieries in Wales. There is not one vacancy for young people in the coalfields of South Wales at present.
  8.37 pm
  Mr. John Evans: I am sure that the whole House will recognise that this has been a truly remarkable debate, particularly because of the speeches that we have heard from this side of the Chamber from men who have spent their entire lives in the coal mining industry. They revealed their tremendous knowledge of that industry. We have had only two contributions from the Conservative Benches—an interesting contribution from the hon. Member for Sheffield, Hallam (Mr. Osborn) and a remarkable speech from the hon. Member for Bedford (Mr. Skeet), to whom I shall refer later. We also had a typically evil intervention from the hon. Member for Flint, West (Sir A. Meyer), who enjoys an odious reputation as a result of his interventions. It added nothing to the debate, but that is the sort of thing that we now expect from him.
  I have a considerable constituency and personal interest in this debate. I have two collieries in my constituency, Parkside and Golborne, where 10 miners lost their lives in a dreadful pit accident last year. It is worth while putting on record that there is an additional price to be paid for coal by the miners—often with their lives. When some people discuss the mining industry, they overlook that fact.
  I shall be brief because I know that my hon. Friend the Member for Bolsover (Mr. Skinner) wants to participate in the debate, but I feel that it is important to rebut the statement that the Secretary of
  878
  State made in opening the debate when he denied that the Bill was deliberately tightly drawn. The Under-Secretary is well aware of the serious difficulties that we had in Committee in attempting to put down amendments because of the tightness of the money resolution. It was drawn over-tightly to prevent the far-reaching debate that is necessary on the future of the coal mining industry. In a debate about an industry as fundamental as coal mining we need to know the targets that the Government want to set for coal production, not only for the short-term, but for the medium and long terms.
  It is right to pay tribute both to the Under-Secretary and to the Chairman of the Committee for the way in which they responded to our speeches which, if I am honest, were sometimes not entirely in order. The Government accepted one minor amendment to clause 1 (1)—to delete the words "on one occasion only". That referred to the authority of the Secretary of State, with the approval of the Treasury, to increase the borrowing requirement by statutory instrument from £3,400 million to £4,200 million. That sums up the differences between the two parties and the inflexible approach adopted by the Government to the borrowing requirements of the NCB.
  All the leaders in the Western world recognise that coal has a great future. The Under-Secretary will recall that we spent some time in Committee, both before and after the Prime Minister reported to the House on the Venice communique, discussing that matter. The communique recognised that the output of coal in the Western world should be doubled by 1990, from 600 million tonnes to 1,200 million tonnes. Because Britain has technically recoverable reserves of coal of 45 billion tonnes, we assumed that the Prime Minister would rush back to Britain to pronounce from the Front Bench on the wonderful future for the coal mining industry, its enormous reserves of coal, and the attitude of the world leaders. Italy and Japan do not produce coal. Therefore, to meet the agreed target for cutting oil consumption those countries will have greatly to expand their coal imports.
  Hon. Members will recall that the Prime Minister adopted a cold and negative attitude to the questions that were

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  put to her about the Venice communique. She made it clear that the British coal industry would not play any part in the doubling of the Western world's coal output. To refresh my memory I read her answers. She gave a remarkable reply to my hon. Friend the Member for Rother Valley (Mr. Hardy), who referred to productivity in the coal industry. She said:
  "I am very well aware of the substantial improvements in productivity in the coal industry, and I welcome them. With respect, such improvements have so far not been reflected in a lessening of the increase in price."— [Official Report, 24 June 1980; Vol. 987, c. 245.]
  That remarkable answer constrasts vividly with the Government's attitude, and especially with the attitude of the Department of Energy, to gas prices. Gas is another element of the energy industry. Despite the enormous profits that that industry has made over the past few years the Government have decreed that the price of gas should be increased, and that it should be increased further by another 10 per cent. in October. We asked how the market forces applied to the gas industry. We were told that a different set of market forces applied and that the price of gas should be increased in line with the price of oil.
  It seems to be a "no win" situation when one element of the energy sector finds that its prices will be increased despite the enormous profits that it is making, whereas another and even more important element—the coal industry—finds that it is castigated because it has not lessened the increase in the price of coal.
  I suspect that if the sums of the past few years were done correctly we would find that in real terms, taking inflation into account, coal prices have probably lessened somewhat. However, it is interesting to note that the right hon. Lady constantly carps about competitive prices and the need for the British coal industry to be competitive. No Labour Member quarrels with the necessity for the industry to be competitive. Indeed, no Labour Member would complain about any segment of British industry being competitive. But we must ask "Competitive with what?" That is where we always run into difficulties.
  My right hon. Friend the Member for Plymouth, Devonport (Dr. Owen) referred
  880
  to subsidies in EEC countries. He indicated that the subsidy was £34 per tonne in Belgium, £18 per tonne in France, £15 per tonne in West Germany and £1 per tonne in the United Kingdom. How on earth is British industry supposed to compete on equal terms with industries that receive subsidies of that order?
  The hon. Member for Bedford, who unfortunately, has not resumed his place, referred to competition from South Africa. Do I need to remind the House that the South African coal mining industry is virtually serviced by slave labour? Is any hon. Member seriously suggesting that competition from South African mines should be considered fair competition? The same applies to competition from Eastern European countries. Every hon. Member, whatever his political views or beliefs, knows that competition from Eastern European countries simply cannot be measured in terms of fairness, because we do not know the base from which they start. We must always ask that question when we refer to fair competition.
  The Prime Minister, the Secretaries of State for Energy and for Industry, and all of that ilk, constantly put British industry—certainly the coal mining industry—into a Catch-22 situation. They constantly say that if it wants to compete in world markets it must be competitive. But at the same time, particularly in relation to coal, they allow subsidised imports to come in which undermine the rejuvenation of industry. How on earth can one win in those circumstances?
  The British coal mining industry has a right to compete on an equal basis. One would have expected Conservative Members who constantly proclaim their patriotism, to agree with that view although at times they do not seem to extend that patriotism to British workers. Unfortunately—this applies not only to the coal mining industry but to almost every other industry—we cannot achieve that equal basis from which to compete. Until such time as the Government come clean, I suspect that there will always be the cry for the necessity to have import controls in order to protect the British industrial base.
  We also know that the cash limits that have been imposed on the industry are far too rigid and operate over far too short

  881
  a time scale. We all know that this industry requires massive capital expenditure. One cannot open a new colliery or start a new coalfield without masses of capital expenditure. The mining industry is publicly owned, and therefore its finance must come from the public purse. We shall reap the benefits in the years to come.
  I do not think that any Tony Member, no matter how Right wing he may be, would dare suggest that the price of oil will fall in the future. We all know that the price of oil will continue to escalate. In his ridiculous comparison between coal and oil the hon. Member for Bedford suggested that the price ratio between oil and coal was narrowing, even though it is 14 per cent. in favour of coal at present. Yet we all know that after the next OPEC meeting the price ratio will again widen substantially.
  We recognise that the increases in the borrowing limits are welcome, yet we know that they are unnecessary. The Opposition, the coal mining industry and the NUM recognise the sugar-coated pill that is offered to them. Part of the price that must be paid for the increased borrowing limits is colliery closures. The Government know that they will run into substantial difficulties when they attempt to embark upon that programme. We said repeatedly in Committee that no one in the industry or the Opposition would ever object to a mine being closed because its reserves had been exhausted. No miner wants to work down below and send up dirt and dust. We are talking about collieries which may now be uneconomic in narrow financial terms but which, in the foreseeable future, will be economic because of the ever-rising price of oil. Mistakes were made in the late 1950s and 1960s when mines were closed, yet if we could now open them at a reasonable cost they would be economic. They would produce coal economically. In the past they were classed as uneconomic in comparison with the price of oil.
  There is a necessity for a healthy and expanding industry which, if given half a chance, will take its place by exporting coal throughout the world. The majority of the mining industry is in the development and assisted areas. Even Government supporters know that the northern
  882
  half of Britain is in a state of near collapse because of Government policies, yet here we have an industry which, given a chance, could expand. The mining industry, when it was expanding, was an enormous purchaser of materials on a vast scale. If that expansion were repeated today it would give a stimulus to other industries in the area. That is part of the policy which we seek to persuade the Government to adopt.
  Like the hon. Member for Bedford, I am a supporter of the British nuclear industry. Hardly surprisingly, I have a personal interest and belief in the industry. In addition, 6,500 of my constituents work at the Atomic Energy Authority establishment at Risley. There is a great disparity between the Government's attitude to capital expenditure in the mining industry, where we are talking about the expenditure of £4·2 billion over the next few years, and their attitude to the expansion programme for the nuclear industry—with which I agree—where we are talking in terms of a £20 billion-plus expansion.
  In those circumstances it hardly seems surprising that members of the mining fraternity tend towards the view that the nuclear industry is being allowed to grow at the expense of the mining industry. In view of the arguments of the hon. Member for Bedford, it appears that miners' fears are justified, especially when we consider Government policy on defence expenditure. We have already expended £920 million on the Sting Ray torpedo, yet we do not have a torpedo. We shall spend £5 billion on Trident. We are increasing the defence budget in almost every area to kill people, yet here we are discussing an industry that will create wealth and happiness for millions of people.
  One of the other elements in the argument about energy supplies is the plight of the Third world. I do not have time to go into that. However, if we are ever to alleviate the sufferings of the people of the Third world, energy must play a large part in improving their lot. Surely, in that area alone, the expansion of the British coal industry is in their interests.
  Despite the protestations of good faith by the Government, and especially the Secretary of State, they have managed to convey the feeling to the country that the

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  Bill is to be interpreted as cutting back on coal production and spearheading pit closures. The Secretary of State will have a difficult job during the next few months in trying to get it across to the mining industry that that is not the intention of the Bill. That is why I and my hon. Friends will vote for the amendment tonight.
  8.55 pm
  Mr. Dennis Skinner: I realise that the House wants to progress quickly, and I shall not delay it too long.
  One of the things that needs to be said at the outset of my speech is that any Bill that reduces the ability of workers within the public sector must be set against the background of strategy which the Tory Government purport to follow—that of shifting the balance of power away from working class people and their organisations, principally the trade unions, to the bosses. That is putting the matter simply and bluntly, but it is the sort of philosophy that was pointed to by the Secretary of State for Industry before the Tory Government were elected. He made it clear that his main aim would be to shift that balance of power. His main argument was that during the course of the previous Labour Government, and other Governments before that—even the Government of whom the Secretary of State was a member when he messed up the National Health Service—the ratchet had moved too far the other way, and had to be pushed back. The Bill must be looked at against that background. It cannot be looked at in isolation by a "wet" such as the junior Minister, who may be described as a pleasant fellow who tries his best.
  The Tory strategy on the Coal Industry Bill is no different from their strategy on all the other attempts—some successful—to decimate the public sector by cutting public expenditure, allowing prices to rip, allowing interest rates to rocket to the highest level ever, and reducing wages. We now hear the continuing cry of the Prime Minister and her Cabinet colleagues about the need to cut back on wages in order to squeeze inflation out of the economy. That is why this Bill has been described as an attack on the mining industry. However the Under-Secretary of State may reply to some of the questions, the plain fact is that the Government are trying to reduce the power of
  884
  miners and the mining industry by appealing to miners, and saying "We are not attacking you as we are attacking the rest." The only reason why they are not attacking the miners as they are attacking the public sector workers—local government, railway and civil aviation workers—is simply that on previous occasions the miners have been strong enough to take up the cudgels and knock this Tory Government flat on their back.
  Mr. John Evans: Let us knock them down again.
  Mrs. Kellett-Bowman: Which Tory Government?
  Mr. Skinner: The previous Tory Government. They are all the same.
  In 1974, when the miners put the Tory Government out of office, we were on a three-day week. Now we have another Tory Government, and there is hardly any difference.
  Mr. Evans: No one is working.
  Mr. Skinner: It has become official Tory policy to throw people on to a three-day, two-day, one-day, and even a no-day week. The Government have even put forward a Bill to remove the earnings-related supplement. The miners will be affected more than some other workers in that respect. There are also attacks upon the miners' voluntary retirement scheme, by withdrawing the first 312 days of unemployment benefit. These are other attacks that are coming from the Tories. That is why I take this opportunity to attack the Tories once again.
  Some people have the impression that a few of us on the Left wing of the Labour Party do not spend much time attacking the Tories. [Hon. Members: "Where are they?"] I cannot account for them, but I know what I am in business to do. [Hon. Members: "They have just walked in."] Yes, they have come to hear me.
  The Tories were also elected to attack the principle of free collective bargaining. There is no doubt at all that a few blue collar workers were stupid enough to believe the Tories' propaganda in many constituencies, particularly in the South of England. They were carried away with some of the fanciful ideas put forward by the Tories. A few people

  885
  thought that perhaps they would find Utopia under the new axis of Thatcher and Murdoch. [Interruption.] Why do I mention Murdoch? Tory Members know who I mean—
  Mr. Deputy Speaker (Mr. Bernard Weatherill): Order. We must confine ourselves to the Coal Industry Bill.
  Mr. Skinner: What I am attempting to suggest, Mr. Deputy Speaker, at the beginning of my contribution, is that we cannot look at the Bill in isolation from the rest of what the Tories are doing. It is an attack upon the working class. The Tories want to shift the balance of power away from the working class to their own class. That is why we have this Bill today.
  But, quite apart from that, the Bill is barmy. The Government are hell-bent on trying to reduce the bargaining power of workers in the pits and hell-bent on changing and shifting the economy to their own way of thinking. Even set against that background, the economics of the Bill are crazy. We are dealing with the coal industry. It is no different from others around the globe, apart from a few exceptions such as those in America where open-cast mining takes place to a greater extent than here, so that the productivity is bound to be much higher. Not as many miners, as a percentage of the total, have to go down the pits.
  We are looking at an industry that is extractive in nature. A pit is not like a factory which can be producing marsh-mallows one week and typewriters the next. Almost without exception, once pits have been closed, they are closed for ever.
  Some of my hon. Friends from Wales have spoken tonight. I met them at the Welsh miners' rally a few weeks ago. When I looked at them and at the miners they represent in the Welsh valleys, I was taken back to the 1930s and to the occasions when Governments of all kinds were saying "Shut the pits, shift the miners, let them go to Coventry." Coventry then was the new Utopia. Cars were being built there and cars were the "in" thing. There was lots of manufacture and lots of engineering. People said "Miners are skilled and able to do a lot of hard work. Let them go to Coventry." They also went to Corby. Those
  886
  who went there were mainly from Scotland. There were all these new little havens for people on the move. The Tories are trying to do it again now.
  Mr. Rowlands: We shall not go again.
  Mr. Skinner: They were industrial gipsies. Where are the jobs now? Where are the towns that the Prime Minister talks about to which the miners will have to go if they are thrown out of work again in the Welsh valleys?
  Mr. Rowlands: We shall not be moved again.
  Mr. Skinner: Are they to go to Shot-ton, with 30 per cent. unemployed? Are they to go to the towns that have been producing cars? Are they to go to the towns that used to produce textiles but now produce hardly any textiles? Are they to go to towns in the Midlands which have known prosperity, relatively speaking, and which for decades have never known unemployment of the kind that we are witnessing now? Would they go to any of those towns? There are no jobs there. There is too much competition in any event. There is nowhere for these people to move to throughout the length and breadth of Great Britain.
  The Bill has been introduced to reduce the ability of Britain to produce much-needed energy. We cannot turn off taps in the coal industry as in the North Sea and say "Let us run it down for a while. Let us leave it for five years. Let us slow it down." That cannot be done with the pits. Once they are shut, they are gone.
  If the Minister is as right as he has been described by some—I do not know about these things—he should examine what he is doing. The coal industry has to be supported. Apart from the coal industry there is only one other major industry that has not been tackled by Governments by reductions and stop-go policies. I refer to the food industry. It has been argued for generations that we need food and more besides. It is considered spendid if we can produce more food to enable us to improve the balance of payments. All Governments, including the present one, say "Yes. We shall have intervention in the food industry. We shall intervene in every region, pump in money, take out money and put more in." It is exactly the same with the mines.

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  The mining industry must be considered against the background that I have presented. We must ensure that we have sufficient coal, not merely while we have a Tory Government, but for the next five years and for generations to follow. We do not have so much oil or gas in the North Sea that we can afford to shut down pits.
  We hear so much nowadays about wind power, solar power and the liquefaction of coal. These are all splendid schemes, but we do not have them in operation. The chance of having them in abundance is negligible unless there is a massive breakthrough in technology. We must remember where we have enery in abundance compared with the energy resources of many of our major competitors.
  We have the largest coal industry in Europe. Recently the Prime Minister went to Venice to meet all those wonderful people from Europe. That cost the taxpayer about £17,000 for the two weekends. The Government were not worried about spending money then. They were not talking about cutting expenditure during the Venice trips. The first trip cost £8,000 and the second £9,000. That was the cost of swanning along on the gondolas.
  The right hon. Lady returned with a piece of paper. It was rather like another Tory Prime Minister who returned with a piece of paper in his hand. On this occasion it read "Double coal production". The miners were not exactly cheering. However, down in the pits in Bolsover and many other areas, especially in Wales, they must have said "That must be sensible. The Common Market has been a crazy set-up for us all. It has resulted in more imports. There have been £6 million worth of extra imports this year as opposed to an extra £2½ million during the last year of the previous Labour Government. However, here is a chance. Someone is saying something that is sensible. If they want to double coal production, that means that they will keep all the pits in Wales."
  The Prime Minister put the tin hat on all that within days. She said "It did not really mean the United Kingdom. It meant doubling coal production generally but not here." After that she went to Wales and made her infamous speech. She insulted the Welsh people on their
  888
  own territory. She was saying, in effect, "Go on, pack your bags and go." The message was rather like that of Prime Ministers in the 1920s and the 1930s. I have news for Tory Prime Ministers. The youth of today are not as docile as their forefathers. The people in the 1920s and 1930s had never known other than intermittent periods of long unemployment. They had never been able to experience a system in which it was possible for everybody to have a job. However, for two decades after the Second World War it became apparent to generations that such a system was feasible. That was so until the late 1960s.
  Mr. Tim Eggar: Until the Labour Government.
  Mr. Skinner: There were never more than half a million unemployed. However, there are nearly 2 million people out of work now. The Minister should consider the Bill together with some of the speeches, detailed remarks and questions that my hon. Friends have put forward. The Minister said that he would be flexible in terms of deficit financing. I remember those words. Perhaps the Prime Minister has told him that he cannot use them again. I remembered those words, because they were very important. I said to myself "Christ Almighty, there's a gleam coming through this one."
  The Minister should bear in mind that the coal industry can produce over 100 million tonnes, and has the capacity to double that figure. It would demand a tremendous effort and would take about 10 years to do. However, given the new coalfields in Selby, the Vale of Belvoir, and so on, it can be done. We must retain the pits in Wales and Scotland. We must ensure that we have sufficient markets in terms of electricity, the sale of domestic coal and industrial usage. If there were interdependence and interlocking between the coal industry, the steel industry and those that use coal and if we prevented the Government from throwing more people on the scrap heap, we should not only save the coal industry but in addition we should do something sensible for the nation. Many jobs could be saved, and the resulting spin-off would be beneficial to all.
  9.11 pm
  Mr. Alex Eadie: It has been said that there is one certainty about

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  the debate, and that is that we shall win the argument about the Bill. Any hon. Member with experience of our proceedings will accept that that is the logical conclusion. It has also been said that, although we will win the argument and the debate, we shall lose the vote. As we reach the end of this important Third Reading, it is important to set out the progress that has been made. What concessions or hope have the Government given us? After a day's debate on Second Reading, seven Committee sittings, and a day on Third Reading, the Opposition must consider that.
  The catalogue of the Government's promises and assurances is very thin, but they should be listed so that the Minister can confirm them. Only two important promises have been made. Perhaps the Minister recollects that in Committee he replied to a debate on clause 1. On 1 July he gave a specific undertaking. He said that Government financial aid to the research and development pilot projects for the extraction of oil from coal would involve capital sums in addition to the ceilings in the Bill. That is one assurance that the Government gave but which we did not know about before the Committee stage.
  Health is of great importance to the miner. The Under-Secretary responded to hon. Members who complained about the diagnosis for compensation, under industrial injury benefit schemes, for diseases such as pneumoconiosis, bronchitis, emphysema and other diseases associated with work underground. My hon. Friend the Member for Carmarthen (Dr. Thomas) made an interesting contribution. He is a doctor who is acquainted with mining diseases, and he was of assistance to the Committee.
  The Minister said:
  "If my right hon. Friend the Secretary of State agrees I see no reason why I should not initiate a form of tripartite debate immediately where the Government, the board and the mining unions can meet to establish whether, in this whole area of health, we should be examining other potential initiatives. That is a perfectly legitimate and reasonable intention arising from this debate. I do not, however, believe that it is for us to investigate the prospect of doing it in a proper form, such as tripartite discussions."
  He went on:
  "I give a firm undertaking that I shall seek to ask the NUM and the NCB to form, with
  890
  the Government, a tripartite body further to examine the whole area."— [Official Report, Standing Committee B, 15 July 1980; col. 327–8.]
  I have spent some time on that matter because contributions have been made mainly by my hon. Friends from Wales. Diseases associated with work underground are prevalent in Wales. We are entitled to ask the Under-Secretary of State whether he has the agreement of the Secretary of State to proceed with the initiative that he suggested in Committee.
  Reference has been made to the Phurnacite plant in Wales. That matter was raised in Committee by my hon. Friend the Member for Carmarthen. The Minister was non-committal and cagey, and many of us were very unhappy with his reply.
  The House should understand why we attach great importance to the Phurnacite plant and the new Ancid process. Closure of the plant would directly affect 950 jobs and a further 4,500 mineworkers would be involved. That equals five pits.
  The Minister said that he would bring the matter to the House as quickly as possible. The result is a written answer to my hon. Friend the Member for Aberdare (Mr. Evans) on 21 July 1980. The Minister rejects the idea of new capital investment for the new process, and is therefore, at a stroke, endangering 950 jobs and affecting 4,500 others. The Minister shakes his head. That gives us hope.
  The written answer concludes:
  "After the most careful consideration, the Government have decided against giving special assistance, bearing in mind that there are other ways of securing the continued process of phurnacite."— [Official Report, 21 July 1980; Vol. 989, c. 35.]
  What are those other ways? Will the Minister argue that I am exaggerating and that those jobs are not in jeopardy? If so, he should tell us what the employment prospects are.
  When the Bill was first debated we were able to use in support of our argument documents from the mining unions and the sections of the press knowledgeable on energy matters. We could prove that no responsible body accepted the entire Bill. The provisions for revamping the balance sheet and extinguishing grants in three or four years were universally criticised. We could not then quote the views of management to support our case.

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  The Secretary of State said that he had great confidence in the management of the industry. The question that we want to ask is: does he ever listen to what those in mining management say to him? Is he aware of what the British Association of Colliery Management said about the Bill? There was no collaboration between us and BACOM, but its criticisms of the Bill are identical to those that we have made throughout the passage of the legislation.
  By way of introduction, BACOM says:
  "The financial objectives in the Bill are… too stringent, and cannot be achieved in the given timescale without seriously undermining the healthy growth of the coal industry".
  The Government presented calculations and told us about negotiations that had been carried out with the NCB in November. They had the audacity to present those to the House as being relevant in July 1980. We know how inflation has raged during that time. The Government believe that those are credible figures to present to the House and the nation. The financial objectives in the Bill are described by BACOM as outdated. It goes on:
  "the economic situation has considerably worsened since the strategy was discussed and agreed with the NCB. To meet the Government's targets, the NCB would have to (a) raise the price of coal. But our price is already at the top end of the market."
  It describes the impossible situation facing the nation and those in the coal industry. On increased efficiency it says:
  "By raising productivity and replacing old capital stock with modern equipment, the industry is already making better use of its resources."
  It makes most trenchant criticisms of the Bill and concludes on the question of strategic value and deficit grant:
  "By asking the Coal Industry to break even so soon, the Government is putting no monetary value whatsoever on the strategic necessity of greater indigenous production. If security of supply within the UK, within the EEC and within the Western world is as important as the Government and Western leaders maintain, they should be willing to back their commitment with cash."
  It says that deficit grant is inappropriate and provocative. Some of my hon. Friends have suggested that the Bill is provocative to those in the mining industry.
  The industry was starved of capital. That was one of the main planks of our argument on earlier stages of the Bill. We tried to point out to the Government
  892
  that their time scale was all wrong. The industry was starved of capital investment for more than two decades. We cannot expect that new reserves will start to come into production overnight.
  The Secretary of State said that the Government expected "Plan for Coal" to pay off in the late 1980s. He is not suggesting in the Bill that the late 1980s is the time to discuss the whole question of trying to extinguish grants. To some extent the right hon. Gentleman fell flat on his face. He confessed to the House that it would be the late 1980s before "Plan for Coal" came to fruition. We ask him to believe in his words and take back this nonsense of trying to extinguish the capital operating grants in a period of three years.
  I said on Second Reading that the Bill reeked of party dogma. As the Bill has proceeded through the House, it is a fair and objective comment to say that it has started to leak like a sieve. Every authoritative opinion has criticised the Bill's structure in the same terms as the Opposition have criticised it. The Bill has not had a good press. All unions in the industry, without exception, have expressed fears and misgivings as the Bill has proceeded through the House. Their protests have become increasingly loud. Management has been equally stringent in its criticism. It would be foolhardy of the Government to ignore this criticism.
  It is a new experience to find management deciding to document its objections. In my 30 years in the industry I never encountered a management that documented its objections in such a trenchant manner. The Minister should examine the documentation. If he has already done so, we are entitled to hear his comments.
  It is depressing to be confronted on Third Reading with the general philosophy and approach that "Whitehall knows best", together with the Tory Party doctrine. It is irresponsible for any Government to ignore the views of men and management who have the responsibility to produce what H G Wells called "bottled sunshine".
  It is established that coal is a fuel not only for the twentieth century but for the twenty-first century. The nation should grasp that fact. The Government should take the lead. It is tragic that the Government should ask the House to support a Bill that could trigger off a

  893
  programme of pit closures and also reduce—a damnable effect—coal production in this country.
  The new pits and the coal reserves will not be in production in the time envisaged in clauses 3 and 4. My hon. Friend the Member for Bolsover (Mr. Skinner) summed up the situation when he said that one can rarely reopen a pit when it has closed. Pits are not like factories. In the words of Rodgers and Hammerstein, "You can't pick up a petal that falls from a flower".
  We think that our amendment offers the Government an opportunity to draw back from the crass folly involved in the clauses that we have highlighted during the passage of the Bill. Because we believe that it is in the best interests of the nation and of those who work in our great coal industry, we hope that some Government supporters who want to assist this nation will join us in our protest in the Division Lobby tonight.
  9.35 pm
  The Under-Secretary of State for Energy (Mr. John Moore): We have had an energetic, if not lengthy, Third Reading debate. It might be appropriate first to thank all those who have participated in both Second and Third Readings and in the arduous work of the Committee.
  I automatically assumed that all who spoke in the debate had the future of the coal industry at heart and had no interest in domestic or national politics. But we had the benefit of the advice of and a pyrotechnic display by the hon. Member for Bolsover (Mr. Skinner).
  I am somewhat surprised and a little depressed, having a genuine interest in the coal industry, to see how few hon. Members have read not only the Bill but the detailed debates in Committee. The astonishing statements by Opposition Members makes me wonder what they thought when they saw the Bill and whether they were able to communicate to the mining industry the nature of its fundamental features.
  The first and most classic feature of the Bill is the capital commitment. The right hon. Member for Plymouth, Devonport (Dr. Owen), at the beginning of the debate, acted as though the Government were carrying out another example of, he
  894
  said, a squeeze on a nationalised industry. A squeeze? The capital commitment in the Bill is exactly the capital commitment in the previous Labour Govern-Government's 1979 White Paper at 1979 survey prices turned into today's money. It is exactly the capital commitment of "Plan for Coal" about which we have talked so much. The modest amount that is going in capital investment this year and for the next three years is £800 million. That is a substantial amount of money rightly going into a great industry. Let us recognise what it does. It confirms the previous Labour Government's attitude towards major long-term investment in the industry and it includes the investment outlined in "Plan for Coal" and this Government's commitment to it. Therefore, I have great difficulty in finding out what the Opposition want. They obviously want a great deal more money than is entailed by their own plans when in government.
  Secondly, the Bill has a grant structure which is generous in its recognition of the past. But it is also tough in its sensible desire to move this great industry to genuine profitability.
  The third important feature of the Bill—I shall come back to the remarks made in Committee by the hon. Member for Carmarthen (Dr. Thomas) to which others have referred—is that it is compassionate. It is compassionate in its improvement of social grants, redundancies and transfers in areas where there have not been genuine improvements since 1973. Rightly, it is compassionate towards widows of those who suffered from the dread scourge pneumoconiosis. These are some of the basic features of the Bill which I was astonished not to hear acknowledged and recognised in the debate.
  My hon. Friend the Member for Bedford (Mr. Skeet) was a little unkind in part in his suggestion that there had not been a radical improvement in the coal industry's output since vesting day. I think that we should recognise the fundamental change that has taken place in the nature of the coal industry since vesting day. The significant fact is that in 1947 output per man year in tonnes per man was 266 compared with 469 in 1979–80. That is a major achievement in the coal industry and I believe that all of us who are interested in the industry would wish that to be put on record.

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  My hon. Friend the Member for Bedford asked a couple of detailed questions. He asked what we would do with the limestone slurry that would be formed. We were discussing the important developments in fluidised bed combustion, and we know that there is a great future for our coal industry in that area. I am told that the limestone slurry is associated with the need to remove sulphur from coal. Our coals have a modest sulphur content, and therefore, under existing clean air regulations in the United Kingdom there is no need to use this process.
  In that context my hon. Friend asked how we would get capital costs down. Costs would fall as more systems are built, and fluidised bed systems are expected to be more suitable for relatively small industrial systems than for large power stations. I chaired a meeting of the tripartite research and development committee yesterday, and we looked at the potential not only in Comoil but in fluidised bed combustion techniques.
  The hon. Member for Rother Valley (Mr. Hardy), who takes a detailed interest in the industry, asked some specific questions. I can confirm that if I am permitted to I shall maintain as close a contact with the industry as I have been able to maintain so far. Obviously, I shall keep a close watch on the key figures relating to employment in the industry.
  The hon. Member for Newton (Mr. Evan) referred, legitimately, to the tightness of the money resolution. I, too, felt his dismay, and the dismay of hon. Members on both sides of the House, at some of the limits on our ability to discuss these matters in Committee and the difficulty of tabling amendments. I draw the attention of the hon. Gentleman to the fact that the money resolution is not more tightly drawn than the money resolutions to previous coal Bills. I refer specifically to 1977. I am not able to make decisions in that area, but we are only all fours with past experience.
  The hon. Member for Penistone (Mr. McKay) drew our attention to his sad experiences with pneumoconiosis, and the hon. Members for Leigh (Mr. Cun-liffe), and for Ogmore (Mr. Powell) and in particular the hon. Member for Midlothian (Mr. Eadie), spoke specifically
  896
  about the problems of that disease. Let me remind the House that we have been able—it was pure justice, and I said so in Committee—to make a modest improvement in the Bill. That modest improvement relating to pre-1970 widows has been welcomed on all sides. That is what is being done here.
  In Committee I said that I took the points made by the hon. Member for Carmarthen, who made a great and outstanding speech. I said that I would go forward and have discussions, and I have done so, with the approval of my right hon. Friend the Secretary of State. I am in consultation with the DHSS. This is an area where, if we intend to establish the right kind of tripartite forum, we must do it properly. I have taken the point, and I am pursuing it. I shall report to the House in due course. This is an area in which none of us would expect anything but the most generous treatment that the House can possibly mete out.
  Other substantive and legitimate points were raised, and I do not seek to duck them. Again and again we returned on Second Reading, in Committee and in this debate to the subject of closures. The right hon. Member for Devonport and the hon. Members for Penistone, for Merthyr Tydfil (Mr. Rowlands) and for Newton again raised the issue. May I make the principal point clear? It is vital that the Government should reiterate it repeatedly, and I shall try to deal with the point raised by the hon. Member for Merthyr Tydfil.
  The Bill is not a programme for closures in the industry. Let me illustrate that fact in two clear ways, especially for those who were not involved with our work in Committee. Some people outside the House argue when they examine the capital investment in the industry, that money is going into great new super pits and that other areas without such prospects are not in receipt of similar investment.
  I give the following illustrations to support my view. First, the capital investment programme for the industry assumes £272 million a year in 1979 survey prices. That means that roughly half of all the continuing capital investment will go into existing production. That is the crucial feature of the discussion. Secondly, and most importantly—it can

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  be seen in the detailed figures—the Bill specifically assumes a pattern of closures similar to those of the recent past. On Second Reading I drew attention to the fact that the Opposition, while in government, committed massive capital investment to the coal industry under "Plan for Coal". At the same time, they recognised that there would be closures and openings—but not the problems of the 1960s or the late 1950s.
  It is important to get this on the record. The 50 pits that closed in that period were part and parcel of a long-term investment programme. Let me give the figures for two crucial clauses in the Bill which were not discussed this evening. They illustrate how, in practice, the closure pattern is expected under this legislation to be similar to that of the past year under "Plan for Coal".
  Clause 6 tackles the social grants relating to pit closures. The new limit in clause 6 is £170 million, up from £60 million. Too much fear has been spread on this subject, and this data should help remove that fear. First, where does this increase come from? It relates mainly to the longer period covered—the period of seven years as against three. Of the £170 million increase, £140 million comes from that. Then there are new classes of relevant expenditure based on the assumption that the closure pattern will be the same as for the past year. That accounts for £15 million. The remaining £15 million relates to inflation assumptions.
  Mr. Eadie: I know that the Under-Secretary does not wish to mislead the House, but there is no argument between the Government and the Opposition about the proposed capital investment and the question of the new reserves in "Plan for Coal" beginning to pay off. There is general agreement that the industry needs investment. Is the hon. Member not misleading the House in saying that the pattern is the same? The pattern is not the same. In clauses 3 and 4 he proposes to extinguish the operating grants, and if this is carried out it will mean pit closures.
  Mr. Moore: When the hon. Member was in office he looked at the removal of operating grants. These grants were never seen by his Government as a per-
  898
  manent feature of the coal scene. It is our positive attitude towards the coal industry that assumes that that industry, in the new world in which it will exist, will be able to break out of the trap of grant relationships with the Government. That is not just in clause 6. It is in clause 7 as well on the payment to redundant workers, where exactly the same assumptions are applied.
  Mr. Rowlands: I accept that the Under-Secretary is answering a major point, but I should like clarification. Will he give an assurance to hon. Members representing South Wales constituencies that the sort of average pit-closure programme of the last four or five years and the assumptions in the Bill will be the same? Our basic point is that the assumptions have changed dramatically, particularly in South Wales. We are talking not about being able to handle a small number of pit closures over a six or seven-year period, but about a much larger number of closures over a shorter period. This is extremely important, because no one wants to—
  Mr. Speaker: Order. I was hoping that the hon. Member would come to a conclusion. This is a very long intervention.
  Mr. Moore: What I am trying to say is that the Government are not in the business of trying to decide on the detailed management of the coal industry. That is not our job. The Government have said two things: first, that this is not a closure programme for the industry; secondly, that we must put in a set of assumptions on redundancy, social grants and payments relating to closures. These are assumptions of what the industry feels will fit into Government strategy. That should remove the fear of total closures from the minds of hon. Members.
  The right hon. Member for Devonport and the hon. Members for Merthyr Tydfil and Midlothian raised the question of Phurnacite. Many hon. Members expressed concern about that issue. I was asked a question on Monday by the constituency Member concerned, and I feel that it is a matter of courtesy to answer him. It is simply not true to make the assumption that the Government's refusal to advance non-commercial investment—investment that the board would not seek to invest in that plant—will mean that the plant will be doomed. If we are

  899
  talking about job implications, I draw the attention of Opposition Members to the fact that the proposed permanently noncommercial Ancit process assumes a massive reduction in the numbers employed at that plant. The two batteries referred to during the debate would employ 70 men, while more than 300 are currently employed on the batteries.
  The assumption that the plant will close is wrong. The NCB is in urgent discussion with National Smokeless Fuels, the Alkali Inspectorate local authorities and the trade unions to determine how best to continue production while minimising the environmental problem. I was asked about my attitude towards the in-specorate, it is an independent body and must operate independently within its statutory powers.
  We are, rightly, talking about a coalfield in South Wales that has received more than £150 million in investment during the past five years. We are not talking about a disaster for the Phurnacite plant, but about potential, continued production—a matter which is now in the hands of the board.
  Many hon. Members raised the problem of imports, including the right hon. Member for Devonport, and the hon. Members for Merthyr Tydfil, Carmarthen, and Newton. I want to put that subject into perspective. The import position in 1979 was 4·38 million tonnes. We also exported coal. Therefore, for 1979 as a whole, the coal industry was 97·62 per cent. self-sufficient. As I said on Second Reading, the coal industry has nothing to fear from imports. The Government do not see any future for Britain as a trading nation if we impose artificial barriers to trade, especially for coal. We do not consider imports to be a long-term threat. We believe that the great bulk of our needs will be supplied from the domestic market. If we are competitive, there will be opportunities in overseas markets. The crucial provision is that the industry must be competitive.
  I recognise the special problems of coking coal during a major world steel recession, and in a world where Britain has difficulties in adjusting to that major client of the coal industry. The answer is not to restrict imports but to help the coal industry to adjust in the transitional period. We have already done that with a coking coal grant. In specific
  900
  answer to a question from the right hon. Member for Devonport, may I say that the British Steel Corporation and the NCB are currently discussing next year's position. When they have completed their discussions, we expect them to come to the Government. We assume that, in the overall pattern of grants, there will be a further coking coal grant. I cannot be more clear. That is the legitimate way to help the coal industry in its difficult transitional problems.
  Mr. Skinner Mr. Skinner rose—
  Mr. Moore: I should like to give way, but I have very little time.
  Another key and crucial point made by hon. Members throughout the debate, was in relation to foreign support. The right hon. Member for Devonport, the hon. Members for Penistone, Merthyr Tydfil and Newton, and my hon. Friend the Member for Sheffield, Hallam (Mr. Osborn) all raised that point. They talked about the relative treatment of overseas coal industries compared with our own. We have discussed this question at considerable length.
  Mr. Skinner Mr. Skinner rose—
  Mr. Moore: We discussed this at considerable length on Second Reading. Countries expecting to participate in the major growth in world coal are not countries which are seeking to subsidise their coal industries. The United States, Australia and Canada are examples. The subsidies exist in countries which are not seeking to compete with our coal industry. For those who are interested in the details—
  Mr. Skinner: On a point of order, Mr. Speaker. A few moments ago the Minister gave some figures with regard to imports which related to 1979. During the debate my hon. Friends were simply asking for the import figures—
  Mr. Speaker: Order. The hon. Gentleman cannot pursue his argument with the Minister on a point of order.
  Mr. Skinner: The Minister misled the House.
  Mr. Moore: Perhaps I can help the hon. Member for Bolsover. Clearly because of the major radical difficulties experienced by the coal industry in 1978–79, and the urgent need for an added coal

  901
  burn in this country, it is expected that the 1980 figures will be greater because the CEGB instituted long-term contracts. No one has denied that.
  I turn to the subsidy pattern. It seems to me that we must distinguish between our belief in a future, growing coal industry, where its coal markets are in competition with other fuels—such as substitute natural gas and the liquefaction market and in the area of industrial usage—and those parts of the coal industry which are static or declining. In the belief that our coal industry will expand, we must have an industry which is competitive in those areas.
  Whatever the deliberations in this House, the coal industry is much more than the legislation we have been discussing. The coal industry represents a key resource in the ground, as well as the skills and abilities of the men who mine it. In the belief that they desire an industry that is capable of fulfilling the challenge of the future, the Bill establishes the framework to give the industry the investment to encourage it to profitability and to treat with compassion the burdens of the past. It is in that belief that I commend the Bill to the House.
  Question put, That the amendment be made.
  The House divided: Ayes 236, Noes 279.

  See Division 429 in col. 913
  Question accordingly negatived.
  Main Question put forthwith, pursuant to Standing Order No. 39 (Amendment on second or third reading), and agreed to.
  Bill accordingly read the Third time and passed.

  BUSINESS OF THE HOUSE
  Ordered,
  That, at this day's sitting, the Magistrates' Courts Bill [Lords] may be proceeded with, though opposed, until any hour.— [Mr. Cope.]

  NATIONAL COAL BOARD (BORROWING POWERS)
  10.11 pm
  The Under-Secretary of State for Energy (Mr. John Moore): I beg to move,
  That the draft Coal Industry (Borrowing Powers) Order 1980, which was laid before this House on 17 July, be approved.
  I shall briefly explain the reasons why the Government have laid the draft order. It is laid under existing legislation to raise the limit on the National Coal Board's borrowing powers from £2,200 million to £2,600 million. Perhaps I should explain why we are doing this when the Coal Industry Bill is before Parliament.
  The NCB borrowings stood at £2,120 million on 21 July and the board expects to pass its existing limit of £2,200 million on 31 July. While the Government still seek to secure Royal Assent to the Bill before the Summer Recess, it would be quite wrong to risk leaving the NCB unable to carry on its affairs.
  10.12 pm
  Mr. Alex Eadie: The Opposition understand fairly well what prompts the Minister to move the order on behalf of the Government. We could in normal circumstances have had a debate, according to the rules laid down by the House, but the whole House will agree that we have welcomed the fact that we have had a very long and very substantial Third Reading debate on the Coal Industry Bill.
  The view of the Opposition, therefore, is that, since the order that the Minister has moved is necessary, we wish to give it an unopposed passage through the House.
  Question put and agreed to.

  MAGISTRATES' COURTS BILL [LORDS]
  Order for Second Reading read.
  10.14 pm
  The Solicitor-General (Sir Ian Percival): I beg to move, That the Bill be now read a Second time.
  I shall be very happy to explain to the House any of the provisions of the Bill if any hon. Member should so desire. Meanwhile, I shall content myself by paying a warm and sincere tribute to the Joint Committee for the time and expertise that it has given to the Bill. Yet again, we have very good reason to be grateful to the Committee, and indeed we are.
  Mr. Jeffrey Thomas: I congratulate the Solicitor-General on his brevity. I associate myself and the Opposition with his remarks, and in particular with those relating to the work of the Joint Committee. We owe it a great debt of gratitude and thank it very much indeed.
  Question put and agreed to.
  Bill accordingly read a Second time.
  Bill committed to a Committee of the whole House.— [Mr. Cope.]
  Bill immediately considered in Committee; reported, without amendment.
  Motion made, and Question, That the Bill be now read the Third time, put forthwith pursuant to Standing Order No. 56 (Third Reading), and agreed to.
  Bill accordingly read the Third time and passed, without amendment.

  WISLEY AIRFIELD
  Motion made, and Question proposed, That this House do now adjourn.— [Mr. Cope.]
  10.16 pm
  Mr. Keith Wickenden: It is usual at the commencement of an Adjournment debate for the Member who initiates the debate to express his pleasure and gratitude at being able to do so. I must say that it gives me no pleasure to have to raise this matter. It
  904
  is one that reflects gravely on a Government Department, and perhaps even higher. Nevertheless, I am extremely grateful to Mr. Speaker for giving me the opportunity of raising it today.
  Wisley airfield is in Surrey and in my constituency. The facts are simple, straightforward and easy to understand. I wish that I could say the same for the behaviour of the Department of the Environment, which has been conducting affairs. The airfield came about during the war when a large area of agricultural land was requisitioned from the family of the present Earl of Lytton for defence purposes.
  At the time of the requisition, local authorities, even in wartime, were seriously concerned about the land's future use because of its proximity to two villages in the constituency—namely, Ripley and Ockham. They had meetings with Ministers, as a result of which they received a categoric assurance that the airfield would be used only for so long as hostilities continued. Needless to say, that pledge was not honoured. Nevertheless, the local authorities understood the reasons given to them after the war for continuing airfield use.
  It was explained to them that the airfield would continue to be required for defence purposes. Subsequently, when it was taken over by Vickers Armstrong, later part of the British Aircraft Corporation and later still part of British Aerospace, it was understood that the public interest required the use of the airfield for testing purposes, as it had a particularly long runway. It was said that its use should continue to enable export sales to be made. Those were the arguments used and they were good ones.
  Although the local authorities, especially Surrey county council, had considerable reservations, they nevertheless agreed to the airfield's continuing use. Furthermore, they did so on the clear understanding—asked for, given and expressed on numerous occasions—that if and when the airfield was returned to non-flying use the hangars and runways would be removed. In other words, the airfield had been built on agricultural land and would be given back for that use. Apart from anything else, Wisley is in the green belt.
  In due course, the property ceased to be used for flying purposes. Immediately,

  905
  there was pressure to have those expressions of intent—I put them no higher than that—honoured by the Property Services Agency, which is controlled by the Department of the Environment. A multitude of Government Departments have been involved over the years, but to all intents and purposes the Property Services Agency and the Department of the Environment are the bodies involved.
  The situation has not always been as clear as that. In 1976, the Department appeared to change its mind about whether the airfield would be returned to agricultural use after the runways had been taken up. A series of meetings and a great deal of correspondence took place between the local authorities and the Department. As a result, the Department returned to its original decision—namely, that the property would only be returned under what had become the Crichel Down procedure, with the runways taken up.
  I shall not weary the House by going into the many promises, undertakings—although not legal undertakings—assurances and expressions of intent that were given. However, I must refer to a few of the assurances that followed that 1976 hiccup. In early 1977, Surrey county council decided to reconsider the matter and sought an assurance that the airfield would not be returned, under the Crichel Down procedure, without the runways having been taken up and the buildings having been pulled down. It received those assurances from the Department. Minutes of meetings and letters from the Department record that.
  The former Under-Secretary of State, the hon. Member for Manchester, Gorton (Mr. Marks), wrote to my predecessor on 14 June 1977. He pointed out that it had taken longer than expected to consider taking up the runways and hardstandings. He said:
  "It will not, however, be possible to remove the reinforced concrete hardstandings without an undue burden of cost to Government funds and so they will remain in situ."
  That contradicted much of what had been said before. The local authorities challenged the fact that it would cost money to take the runways up. To the surprise of the Department, they managed to obtain an estimate from an extremely well-known civil engineer, to the effect
  906
  that it would pay to take the runways up because of the hard core in them. As a result, the opposition of the Property Services Agency seemed to disappear.
  On 15 November 1977, the agency went back to its original position, and a letter addressed to the clerk and chief executive of Surrey county council stated:
  "We do not propose to effect any sale of Wisley Airfield until removal of the buildings and runways has been completed. It is intended that sales of the buildings and the runway will be arranged consecutively during 1978 and it is unlikely that completion of the removal will be effected much before the end of 1978."
  On 17 August 1978, the Property Services Agency wrote again to the clerk of Surrey county council. It stated:
  "The delay caused by the abortive tender action is of course regrettable but as Mr. D. M. Brown said in his letter of 15 November 1977, we do not propose to effect any sale of Wisley Airfield until removal of the buildings and runways has been completed."
  In a letter dated 11 December 1978, the Property Services Agency referred to the contract for the removal of the hangars. It stated:
  "We propose following the completion of that contract immediately with a further one for the removal of the runway."
  The letter then explained why the two had to take place together. It explained that it was necessary to get vehicles across the hardstanding of the runway in order to demolish the hangars.
  In a letter to the county planning officer on 27 February 1979, the Property Services Agency stated:
  "Like you I also am disappointed that as yet we have not been successful in completing the contract for the sale and removal of the buildings at Wisley but I am a little at a loss to understand your reference to lack of positive action. I would have thought that the action over the past 2 years has all been of a positive nature which unfortunately has not yet been brought to a statisfactory conclusion."
  I suspect that the gentleman who wrote that letter is unable to differentiate between inactivity and action.
  The letter went on:
  "I am also a little surprised that you return to the view that providing there is no cost to public funds we should discount any possible gain to public funds I am sure it will be understood that we cannot accept that premise."
  The letter continued with technicalities.

  907
  On 6 March 1979, a letter from the county planning officer to the Property Services Agency stated:
  "I assume that since the building should now be removed by the end of July"—
  that was two and a half years after we first began to talk about it—
  "it will be now possible for you to proceed to invite tenders for the removal of the runway, which can then take place immediately following the demolition of the hangars and buildings."
  The PSA replied:
  "You will recall that in our letter of even reference dated 11 December 1978 we said that it was proposed to follow the completion of the contract for the removal of the buildings with a further one for the removal of the runway. This is still the Property Services Agency intention."
  On 6 March 1979 the hon. Member for Gorton said in a letter to my predecessor, Sir George Sinclair:
  "It is PSA's intention, following the removal of the hangars and buildings, to invite tenders for the sale and removal of the runway."
  This is now at ministerial level.
  On 23 May 1979, the PSA repeated to the clerk and solicitor of the Guildford borough council:
  "I have really little to add to that which has already been said to the effect that unless we receive instructions to the contrary"—
  that is where an element of doubt began to creep in—
  "our intention is still to follow the completion of the contract to remove the buildings with a contract to remove the runway."
  On 13 July 1979, out of the blue, a letter to the clerk and chief executive of the Surrey county council said:
  "As you know we have for some time been endeavouring to restore Wisley Airfield, as far as is practicable to agricultural use, and to this end we have arranged the demolition of the buildings which should be completed shortly."
  That has happened. The letter continued:
  "It has however now been decided that disposal of Government interest in the airfield should be effected as soon as possible and to this end the airfield is to be offered to the former owner the Earl of Lytton under the Crichel Down Code. This means of course that the airfield will be offered to the Earl of Lytton with the runway and associated hardstandings in situ. I am sending copies of this letter to the County Planning Officer."
  One would think that when a Government agency decides to break the pledges which it has given over many years, it might at least have the courtesy to discuss the matter with the local authorities
  908
  involved. It says little for the standards of ethics in our Civil Service if that is the measure of its behaviour.
  This caused a great deal of concern to my constituents and local representatives. I proceeded to make inquiries. The reason given for the change of heart was that a company, not the owner of the land or the person to become the owner of the land, had applied for planning permission to use the airfield for general aviation purposes—that is, for light aircraft. Not having received a favourable response from the local authority, the company appealed to the Department of the Environment against a deemed refusal.
  On behalf of the Department, it was said that the runways could not now be taken up because that would prejudice the quasi-judicial position of the Secretary of State, who would eventually have to determine the appeal. There might be some small measure of truth in that, although it equally could be argued that the extent to which the Government Department was going out of its way to break its pledges without consultation indicated that it was not adopting a neutral position, although that was not what I felt at the time.
  As my hon. Friend the Minister knows, I conducted a long and, at times, rather angry correspondence with him, and we differed considerably. Nevertheless, we tried to find one or two alternatives. The problem could have been overcome quite simply if the property was not to be sold back under the Crichel Down procedure until after the planning appeal had been determined. At that stage, if the appeal had been successful, the Government could have sold the property with the value of the runway, which is very considerable as a runway, to the Earl of Lytton, and we should have had no argument in the constituency, because the proper planning procedures would have been followed. If, however, the appeal failed, it would not have been unreasonable to expect that the Government should at that stage honour their promises.
  That proposal was turned down, apparently because of the need to raise money to reduce the public sector borrowing requirement. Some of us feel that, important as it is to reduce the public sector borrowing requirement, it is also important to behave within a reasonable code of ethics.

  909
  I then put forward another proposal that, if we could not expect the property not to be sold and if we could not expect the runway not to be taken up, it could be sold with a covenant that would be triggered only in the event that the planning appeal failed. The covenant would be that the then owner should take up the runways. That, too, was rejected, again on the ground that it would prejudice the quasi-judicial position of the Secretary of State. That appears to be the excuse that is trotted out every time that the civil servants are unable to think of a sensible reason for declining the suggestion.
  Matters then got a great deal worse. In the meantime, the Surrey country council discovered that it had not a promise but a legally binding undertaking from the Department of the Environment to its predecessor to replace the rights of way over the airfield which had been eradicated during the war. That was legally binding, so the council had been advised. Indeed, it is admitted as such by the Department, since it has agreed to take them up and has in writing agreed to restore them to their former condition, which means that they would not be covered with tarmac.
  It was therefore something of a shock to the county council to hear rumours that the Government might not be going to honour that legally binding undertaking. It therefore wrote to the Property Services Agency at the end of May 1980, putting it on notice that it would be putting a caution on the land to require the PSA to conduct itself in accordance with the legal undertaking and also requiring other things. On 27 June 1980, a little more than four weeks later, it received a reply from the Property Services Agency which is indicative of the most disgraceful sharp practice that I have ever come across. The second paragraph states:
  "I am unable to confirm that the land will be offered to the county council, because the PSA has effected a sale of the airfield to Lord Lytton, i.e. there is in existence a contract of sale for the whole and all the land being sold, with the exception that the sites of the original rights of way have been transferred."
  In a written question, I asked my hon. Friend when the transfer took place. The answer was on 20 June, three weeks after notice of legal caution had been received
  910
  from the Surrey county council. It was contracted and completed on the same day. I have never known that happen even in the commercial field, where things happen fast, let alone with the Government legal services. I repeat that that letter, in a shabby story, is the most disgraceful example of sharp practice that I have come across.
  I shall read parts of a letter from a constituent who is asking me to refer the matter to the Ombudsman. Before we fee] that we are dealing with a Home Counties crank, let me say that Mr. John Cooper, who wrote the letter, is a managing director of a leading merchant bank in the City of London, and he perhaps knows the meaning of the phrase "My word is my bond". He is not a crank but a reasonably intelligent and articulate man. He uses phrases such as:
  "I was very shocked to read in the Surrey Advertiser of the behaviour of the Property Services Agency. Assuming that the reports are correct, I am writing as a resident with land immediately adjacent to ask you to object … As a loyal and enthusiastic supporter of you as our Member of Parliament and also as chairman of the Conservative Association of Ockham, Ripley and Wisley, the villages most adjacent. I am finding it very difficult to prevent the whole Wisley airfield saga from thoroughly souring support for the Government in the locality."
  That is an area where we probably got 80 per cent. of the vote at the general election.
  I could spend a great deal of time on this matter, but I shall conclude by saying that it is a sad and shocking story. It is one of broken promises, sharp practice and had faith. Throughout my speech I have deliberately addressed my criticisms to the Government Departments involved, as Departments I have to say, with all the humility that I can, that if my hon. Friend the Under-Secretary is to avoid having the same charges levelled at him he must renounce the sort of behaviour that has taken place.
  10.41 pm
  The Under-Secretary of State for the Environment (Mr. Geoffrey Finsberg): My hon. Friend the Member for Dorking (Mr. Wickenden) has rightly raised this matter in the interests of his constituents. Let me say at once that I endorse every action that my Department has taken. I do not accept that there has been sharp practice or that anything unethical has been done.

  911
  I have been at great pains to examine for myself every piece of paper issued on this matter since the day I took office. My hon. Friend will understand that I have no right to see documents from before May last year. In my judgment, as one who has had some experience in the commercial world, nothing unethical has been done by my Department since I have had responsibility for it.
  In the limited time avalable to me I should like to deal with one or two of the points that my hon. Friend raised. He said that the PSA had broken a legal, or at least a moral, undertaking by deciding not to remove the runway before selling the airfield. No undertaking to remove the runway was given by the PSA. It was the agency's intention to remove the runway before the sale if that were economically possible, but an appeal was lodged against a deemed refusal of planning permission to use the airfield for flying purposes. Because the decision on such an appeal is the responsibility of my right hon. Friend the Secretary of State, it would have been prejudicial to his position in hearing the appeal if we had gone ahead with the removal of the runway.
  My hon. Friend said that in his opinion the undertaking that had been given to restore several rights of way over the airfield was not being fulfilled. I acknowledge unreservedly that an undertaking was given to restore the rights of way to a condition
  "similar to that when they were closed." That is being done, but it cannot be agreed that public money should be used, as the local authority suggests, to replace a pre-war lane with a 36-ft wide roadway with an 18ft carriageway apparently leading to an overgrown track, or to remove 1 kilometre of runway more than 50 metres wide in order to provide a soil surface footpath one metre wide. No reasonable person could accept that that would restore the situation to what it was before the war.
  My hon. Friend has fairly put the case for his constituents. He acknowledged that the Government's intention since May of last year—and I am sure that he endorses it—has been to reduce the public sector borrowing requirement. For that reason, surplus Government-owned land must be disposed of as swiftly as possible.
  912
  To have to await the outcome of a planning impasse—and there was and is nothing to prevent further planning applications followed by further planning appeals—could mean that the disposal of Wisley airfield, already delayed for several years, would be delayed indefinitely.
  As the local planning authorities consider that the land should be used only for agriculture, and because its disposal could not reasonably be further delayed, I took the decision that it should be offered back to the former owner's successors under the Crichel Down code. Therefore, I instructed my officials to proceed with the sale to the successors, with the runway remaining, at market value as assessed by the district valuer, and a sale has now been completed.
  My hon. Friend referred to the proposed registration of a caution against the registered title of the land by the Surrey county council. He felt that it was a somewhat unfair procedure that the PSA should have completed the sale prior to the lodging of that caution. Again, that decision was taken by me, and my officials were instructed to expedite the sale so as to avoid the Government's intentions being frustrated by an act by a local authority—these are the important words—which had no legal justification. I stand firmly by that decision.
  I do not in any way believe that my hon. Friend was wrong or unfair to raise this issue, but some of the things that have been reported in the local press and some of the actions and purported actions by the local authorities have not been totally accurate.
  If my hon. Friend still feels that the interests of his constituents would be best served by referring this matter to the Parliamentary Commissioner that is his right. I shall not feel in the least unhappy, because I think that he has a duty, if I have not convinced him, to take the matter as far as he feels that he should.
  Having looked at this matter on numerous occasions—true, only since May of last year—on the papers that I have seen from the day that I had responsibility for the Property Services Agency, I find nothing with which I would quarrel.
  I hope my hon. Friend will feel that the explanation that I have given, the answers that I have tried to give to the

  913
  points-that he made and the full correspondence that he has had from me, even if he does not accept it all as being an answer to what he wants, show that I have not tried to conceal anything.
  The one thing that I will not allow is for blame, if there be any, to fall upon the civil servants. Whatever blame there may be—and I do not believe that there

  COAL INDUSTRY BILL

  Division No. 429]

  AYES

  [9.58 pm

  Adams, Allen

  Eastham, Ken

  Lewis, Arthur (Newham North West)

  Allaun, Frank

  Edwards, Robert (Wolv SE)

  Lewis, Ron (Carlisle)

  Alton, David

  Ellis, Raymond (NE Derbyshire)

  Litherland, Robert

  Anderson, Donald

  Ellis, Tom (Wrexham)

  Lofthouse, Geoffrey

  Archer, Rt Hon Peter

  English, Michael

  Lyon, Alexander (York)

  Armstrong, Rt Hon Ernest

  Ennals, Rt Hon David

  Lyons, Edward (Bradford West)

  Ashley, Rt Hon Jack

  Evans, loan (Aberdare)

  McDonald, Dr Oonagh

  Ashton, Joe

  Evans, John (Newton)

  McElhone, Frank

  Atkinson, Norman (H'gey, Tott'ham)

  Ewing, Harry

  McKay, Alien (Penistone)

  Bagier, Gordon A. T.

  Faulds, Andrew

  McKelvey, William

  Barnett, Guy (Greenwich)

  Field, Frank

  MacKenzie, Rt Hon Gregor

  Barnett, Rt Hon Joel (Heywood)

  Fitch, Alan

  Maclennan, Robert

  Beith, A. J.

  Flannery, Martin

  McNally, Thomas

  Benn, Rt Hon Anthony Wedgwood

  Fletcher, Ted (Darlington)

  McWilliam, John

  Bennett, Andrew (Stockport N)

  Foot, Rt Hon Michael

  Magee, Bryan

  Booth, Rt Hon Albert

  Forrester, John

  Marshall, David (Gl'sgow, Shettles'n)

  Boothroyd, Miss Betty

  Foster, Derek

  Marshall, Dr Edmund (Goole)

  Bottomley, Rt Hon Arthur (M'brough)

  Fraser, John (Lambeth, Norwood)

  Marshall, Jim (Leicester South)

  Bray, Dr Jeremy

  Freeson, Rt Hon Reginald

  Martin, Michael (Gl'gow, Springb'rn)

  Brown, Hugh D. (Provan)

  Garrett, John (Norwich S)

  Mason, Rt Hon Roy

  Brown, Robert C. (Newcastle W)

  Garrett, W. E. (Wallsend)

  Maynard, Miss Joan

  Brown, Ronald W. (Hackney S)

  George, Bruce

  Meacher, Michael

  Brown, Ron (Edinburgh, Leith)

  Gilbert, Rt Hon Dr John

  Mellish, Rt Hon Robert

  Buchan, Norman

  Ginsburg, David

  Mikardo, Ian

  Callaghan, Rt Hon J. (Cardiff SE)

  Golding, John

  Millan, Rt. Hon Bruce

  Callaghan, Jim (Middleton & P)

  Graham, Ted

  Miller, Dr M. S. (East Kilbride)

  Campbell-Savours, Dale

  Grant, George (Morpeth)

  Mitchell, Austin (Grimsby)

  Canavan, Dennis

  Grant, John (Islington C)

  Mitchell, R. C. (Soton, Itchen)

  Cant, R. B.

  Hamilton, James (Bothwell)

  Morris, Rt Hon Alfred (Wythenshawe)

  Carter-Jones, Lewis

  Hamilton, W. W. (Central Fife)

  Morris, Rt Hon Charles (Open3haw)

  Cartwright, John

  Hardy, Peter

  Morris, Rt Hon John (Aberavon)

  Clark, Dr David (South Shields)

  Harrison, Rt Hon Walter

  Morton, George

  Cocks, Rt Hon Michael (Bristol S)

  Hattersley, Rt Hon Roy

  Moyle, Rt Hon Roland

  Cohen, Stanley

  Haynes, Frank

  Newens, Stanley

  Coleman, Donald

  Healey, Rt Hon Denis

  Oakes, Rt Hon Gordon

  Concannon, Rt Hon J. D.

  Heffer, Eric S.

  Ogden, Eric

  Cox, Tom (Wandsworth, Tooting)

  Hogg, Norman (E Dunbartonshire)

  O'Halloran, Michael

  Craigen, J. M. (Glasgow, Maryhill)

  Holland, Stuart (L'beth, Vauxhall)

  O'Neill, Martin

  Crowther, J. S.

  Home Robertson, John

  Orme, Rt Hon Stanley

  Cryer, Bob

  Homewood, William

  Owen, Rt Hon Dr David

  Cunliffe, Lawrence

  Hooley, Frank

  Palmer, Arthur

  Cunningham, George (Islington S)

  Horam, John

  Park, George

  Cunningham, Dr John (Whitehaven)

  Huckfield, Les

  Parker, John

  Daiyell, Tam

  Hudson Davies, Ednyfed (Caerphilly)

  Parry, Robert

  Davidson, Arthur

  Hughes, Mark (Durham)

  Pavitt, Laurie

  Davies, Rt Hon Denzil (Llanelli)

  Hughes, Robert (Aberdeen North)

  Powell, Raymond (Ogmore)

  Davies, Ifor (Gower)

  Hughes, Roy (Newport)

  Prescott, John

  Davis, Clinton (Hackney Central)

  Janner, Hon Greville

  Price, Christopher (Lewisham West)

  Davis, Terry (B'rm'ham, Stechford)

  Jay, Rt Hon Douglas

  Race, Reg

  Deakins, Eric

  John, Brynmor

  Radice, Giles

  Dean, Joseph (Leeds West)

  Johnson, James (Hull West)

  Rees, Rt Hon Merlyn (Leeds South)

  Dempsey, James

  Johnson, Walter (Derby South)

  Richardson, Jo

  Dewar, Donald

  Jones, Barry (East Flint)

  Roberts, Albert (Normanton)

  Dixon, Donald

  Jones, Dan (Burnley)

  Roberts, Alan (Bootle)

  Dormand, Jack

  Kaufman, Rt Hon Gerald

  Roberts, Ernest (Hackney North)

  Douglas, Dick

  Kerr, Russell

  Roberts, Gwilym (Cannock)

  Douglas-Mann, Bruce

  Kilfedder, James A.

  Robertson, George

  Dubs, Alfred

  Kilroy-Sifk, Robert

  Robinson, Geoffrey (Coventry NW)

  Duffy, A. E. P.

  Kinnock, Nell

  Rodgers, Rt Hon William

  Dunn, James A. (Liverpool, Kirkdale)

  Lambie, David

  Rooker, J. W.

  Dunnett, Jack

  Lamborn, Harry

  Roper, John

  Dunwoody, Mrs Gwyneth

  Leighton, Ronald

  Ross, Ernest (Dundee West)

  Eadie, Alex

  Lestor, Miss Joan (Eton & Slough)

  Ross, Stephen (Isle of Wight)

  is any—falls squarely on my shoulders and I am prepared to accept it. I hope that on reflection my hon. Friend will feel that there has been no unethical behaviour and that the Property Services Agency has acted in a totally ethical way in the interests of the taxpayer.
  Question put and agreed to.
  Adjourned accordingly at seventeen minutes to Eleven o'clock.

  Rowlands, Ted

  Straw, Jack

  Welsh, Michael

  Ryman, John

  Summerskill, Hon Dr Shirley

  White, Frank R. (Bury & Radcliffe)

  Sandelson, Neville

  Taylor, Mrs Ann (Bolton West)

  White, James (Glasgow, Pollok)

  Sever, John

  Thomas, Dafydd (Merioneth)

  Whitlock, William

  Sheldon, Rt Hon Robert (A'ton-u-L)

  Thomas, Jeffrey (Abertillery)

  Willey, Rt Hon Frederick

  Sllkln, Rt Hon John (Deptford)

  Thomas, Mike (Newcastle East)

  Williams, Rt Hon Alan (Swansea W)

  Silkin, Rt Hon S. C. (Dulwich)

  Thomas, Dr Roger (Carmarthen)

  Winnick, David

  Silverman, Julius

  Thorne, Stan (Preston South)

  Woodall, Alec

  Skinner, Dennis

  Tilley, John

  Woolmer, Kenneth

  Smith, Rt Hon J. (North Lanarkshire)

  Torney, Tom

  Wrigglesworth, Ian

  Snape, Peter

  Urwin, Rt Hon Tom

  Wright, Sheila

  Soley, Clive

  Varley, Rt Hon Eric G.

  Young, David (Bolton East)

  Spearing, Nigel

  Wainwright, Edwin (Dearne Valley)

  Stallard, A. W.

  Walker, Rt Hon Harold (Doncaster)

  TELLERS FOR THE AYES

  Stoddart, David

  Watkins, David

  Mr. James Tinn and

  Stott, Roger

  Weetch, Ken

  Mr. Hugh McCartney.

  Strang, Gavin

  Wellbeloved, James

  NOES

  Adley, Robert

  Dykes, Hugh

  Kershaw, Anthony

  Alexander, Richard

  Eden, Rt Hon Sir John

  King, Rt Hon Tom

  Ancram, Michael

  Edwards, Rt Hon N. (Pembroke)

  Knight, Mrs Jill

  Arnold, Tom

  Eggar, Timothy

  Knox, David

  Atkins, Robert (Preston North)

  Elliott, Sir William

  Lament, Norman

  Atkinson, David (B'mouth, East)

  Emery, Peter

  Lang, Ian

  Baker, Nicholas (North Dorset)

  Eyre, Reginald

  Langford-Holt, Sir John

  Banks, Robert

  Falrbairn, Nicholas

  Latham, Michael

  Beaumont-Dark, Anthony

  Fairgrieve, Russell

  Lawrence, Ivan

  Bell, Sir Ronald

  Faith, Mrs Sheila

  Lawson, Nigel

  Bendall, Vivian

  Farr, John

  Lee, John

  Benyon, Thomas (Abingdon)

  Fenner, Mrs Peggy

  Le Marchant, Spencer

  Benyon, W. (Buckingham)

  Finsberg, Geoffrey

  Lennox-Boyd, Hon Mark

  Best, Keith

  Fisher, Sir Nigel

  Lester, Jim (Beeston)

  Bevan, David Gilroy

  Fletcher, Alexander (Edinburgh N)

  Lewis, Kenneth (Rutland)

  Bitten, Rt Hon John

  Fletcher-Cooke, Charles

  Lloyd, Ian (Havant & Waterloo)

  Biggs-Davison, John

  Fookes, Miss Janet

  Lloyd, Peter (Fareham)

  Blackburn, John

  Forman, Nigel

  Loveridge, John

  Blaker, Peter

  Fowler, Rt Hon Norman

  Luce, Richard

  Body, Richard

  Fox, Marcus

  Lyell, Nicholas

  Bonsor, Sir Nicholas

  Fraser, Rt Hon H. (Stafford & St)

  McCrindle, Robert

  Boscawen, Hon Robert

  Fraser, Peter (South Angus)

  Macfarlane, Nell

  Bottomley, Peter (Woolwich West)

  Fry, Peter

  MacKay, John (Argyll)

  Bowden, Andrew

  Gardiner, George (Reigate)

  McNair-Wilson, Patrick (New Forest)

  Boyson, Dr Rhodes

  Gardner, Edward (South Fylde)

  Madel, David

  Braine, Sir Bernard

  Garel-Jones, Tristan

  Major, John

  Bright, Graham

  Glyn, Dr Alan

  Marland, Paul

  Brinton, Tim

  Goodhew, Victor

  Marlow, Tony

  Brittan, Leon

  Goodlad, Alastair

  Marshall, Michael (Arundel)

  Brocklebank-Fowler, Christopher

  Gow, Ian

  Marten, Neil (Banbury)

  Brooke, Hon Peter

  Grant, Anthony (Harrow C)

  Mates, Michael

  Brown, Michael (Brigg & Sc'thorpe)

  Gray, Hamish

  Mather, Carol

  Browne, John (Winchester)

  Greenway, Harry

  Maude, Rt Hon Angus

  Bruce-Gardyne, John

  Grieve, Percy

  Mawby, Ray

  Bryan, Sir Paul

  Griffiths, Eldon (Bury St Edmunds)

  Mawhinney, Dr Brian

  Buck, Antony

  Griffiths, Peter (Portsmouth N)

  Mayhew, Patrick

  Budgen, Nick

  Grist, Ian

  Mellor, David

  Bulmer, Esmond

  Grylls, Michael

  Meyer, Sir Anthony

  Burden, F. A.

  Gummer, John Selwyn

  Miller, Hal (Bromsgrove & Redditch)

  Butcher, John

  Hamilton, Hon Archie (Eps'm&Ew'll)

  Mills, lain (Meriden)

  Butler, Hon Adam

  Hamilton, Michael (Salisbury)

  Mills, Peter (West Devon)

  Cadbury, Jocelyn

  Hampson, Dr Keith

  Miscampbell, Norman

  Carlisle, John (Luton West)

  Hannam, John

  Mitchell, David (Basingstoke)

  Carlisle, Kenneth (Lincoin)

  Haselhurst, Alan

  Moate, Roger

  Carlisle, Rt Hon Mark (Runcorn)

  Hastings, Stephen

  Monro, Hector

  Chalker, Mrs. Lynda

  Havers, Rt Hon Sir Michael

  Montgomery, Fergus

  Chapman, Sydney

  Hawksley, Warren

  Moore, John

  Clark, Hon Alan (Plymouth, Sutton)

  Hayhoe, Barney

  Morgan, Geralnt

  Clark, Sir William (Croydon South)

  Henderson, Barry

  Morris, Michael (Northampton, Sth)

  Clarke, Kenneth (Rushcliffe)

  Hicks, Robert

  Morrison, Hon Charles (Devizes)

  Clegg, Sir Walter

  Higgins, Rt Hon Terence L.

  Morrison, Hon Peter (City of Chester)

  Cockeram, Eric

  Hill, James

  Mudd, David

  Colvin, Michael

  Hogg, Hon Douglas (Grantham)

  Murphy, Christopher

  Cope, John

  Holland, Philip (Carlton)

  Myles, David

  Corrie, John

  Hooson, Tom

  Neale, Gerrard

  Costain, A. P.

  Howell, Rt Hon David (Guildford)

  Needham, Richard

  Cranborne, Viscount

  Howell, Ralph (North Norfolk)

  Nelson, Anthony

  Critchley, Julian

  Hunt, David (Wirral)

  Neubert, Michael

  Crouch, David

  Hurd, Hon Douglas

  Newton, Tony

  Dean, Paul (North Somerset)

  Jenkin, Rt Hon Patrick

  Normanton, Tom

  Dickens, Geoffrey

  Jessel, Toby

  Onslow, Cranley

  Dorrell, Stephen

  Johnson Smith, Geoffrey

  Osborn, John

  du Cann, Rt Hon Edward

  Jopling, Rt Hon Michael

  Page, Rt Hon Sir Graham (Crosby)

  Dunn, Robert (Dartford)

  Kaberry, Sir Donald

  Page, Richard (SW Hertfordshire)

  Durant, Tony

  Kellett-Bowman, Mrs Elaine

  Parkinson, Cecil

  Parris, Matthew

  Skeet, T. H. H.

  van Straubenzee, W. R.

  Patten, Christopher (Bath)

  Smith, Dudley (War. and Leam'ton)

  Vaughan, Dr Gerard

  Patten, John (Oxford)

  Speed, Keith

  Viggers, Peter

  Pattie, Geoffrey

  Speller, Tony

  Waddington, David

  Pawsey, James

  Spence, John

  Wakeham, John

  Percival, Sir Ian

  Spicer, Jim (West Dorset)

  Waldegrave, Hon William

  Pollock, Alexander

  Spicer, Michael (S Worcestershire)

  Walker, Bill (Perth & E Perthshire)

  Prentice, Rt Hon Reg

  Sproat, Iain

  Walker-Smith, Rt Hon Sir Derek

  Proctor, K. Harvey

  Squire, Robin

  Wall, Patrick

  Raison, Timothy

  Stainton, Keith

  Walters, Dennis

  Rathbone, Tim

  Stanbrook, Ivor

  Ward, John

  Rees-Davies, W. R.

  Stevens, Martin

  Warren, Kenneth

  Renton, Tim

  Stewart, Ian (Hitchin)

  Watson, John

  Rhodes James, Robert

  Stewart, John (East Renfrewshire)

  Wells, John (Maidstone)

  Rhys Williams, Sir Brandon

  Stokes, John

  Wells, Bowen (Hert'rd & Stev'nage)

  Ridsdale, Julian

  Strading Thomas, J.

  Wheeler, John

  Roberts, Michael (Cardiff NW)

  Tapsell, Peter

  Whitelaw, Rt Hon William

  Roberts, Wyn (Conway)

  Taylor, Robert (Croydon NW)

  Whitney, Raymond

  Rossi, Hugh

  Taylor, Teddy (Southend East)

  Wickenden, Keith

  Rost, Peter

  Tebbit, Norman

  Wiggin, Jerry

  Royle, Sir Anthony

  Temple-Morris, Peter

  Wilkinson, John

  Sainsbury, Hon Timothy

  Thatcher, Rt Hon Mrs Margaret

  Williams, Delwyn (Montgomery)

  St. John-Stevas, Rt Hon Norman

  Thomas, Rt Hon Peter (Hendon S)

  Wolfson, Mark

  Shaw, Michael (Scarborough)

  Thompson, Donald

  Young, Sir George (Acton)

  Shelton, William (Streatham)

  Thome, Neil (Ilford South)

  Younger, Rt Hon George

  Shepherd, Colin (Hereford)

  Thornton, Malcolm

  Shepherd, Richard (Aldrldge-Br'hills)

  Townend, John (Bridlington)

  TELLERS FOR THE NOES:

  Shersby, Michael

  Townsend, Cyril D. (Bexleyheath)

  Mr. John MacGregor and

  Silvester, Fred

  Trippier, David

  Lord James Douglas-Hamilton

  Sims, Roger