§ 14. Sir David Priceasked the Secretary of State for Energy what further representations he has received from the British chemical industries about the price disadvantages which they are experiencing as against their European competitors.
§ Mr. David HowellI have received representations from the Chemical Industries Association, the NEDC chemicals EDC and from individual companies.
§ Sir David PriceMy right hon. Friend will know from those representations that the British chemical industry continues to insist that the cost of its major raw material feedstock is made higher than that of its European competitors by Government action. Is my right hon. Friend willing to get together with the industry and at least try to agree the facts even if they cannot agree the policy?
§ Mr. HowellI am certainly aware of views that for the very big users—more than 4 Mw or 5 Mw—the cost of electricity is higher. With regard to feedstock, however, I am not sure that my hon. Friend is correct, although he is very familiar with the industry. On the contrary, although I have considerable sympathy with some of the problems faced by the larger chemical manufacturers, I think that some of their comparisons underestimate the very favourable feedstock prices available to British industry, just as I think that they also underestimate the benefits that will accrue over the year from British Gas holding renewal terms for interruptible gas contracts until December. I think that the industry has problems, but that they are more on the major electricity consumption side than on the feedstock side.
§ Mr. Barry JonesIs the Secretary of State aware that in my constituency the Graesser chemicals company has been forced to put 80 men out of work because of energy costs and that, worse than that, those jobs are being exported to one of its competitors in France?
§ Mr. HowellAs I have said, I fully recognise some of the difficulties facing large electricity users in particular. I have said that we wish to keep the matter under review, but some of the problems are basic problems, such as I mentioned earlier, namely, the cheaper cost structure of French electricity as a result of bold decisions taken on nuclear power and the importation of large quantities of cheap coal.
§ Mr. John WellsIs my right hon. Friend aware that in any league table of industries that suffer from high energy prices, the chemical industry is not nearly so high as the glasshouse sector of horticulture? What does my right hon. Friend intend to do about Dutch competition?
§ Mr. HowellI am very much aware of that problem and I think that my right hon. Friend the Minister of Agriculture, Fisheries and Food has it actively in mind.
§ Mr. RowlandsHow many more jobs will have to be lost in the chemical industry while the Secretary of State keeps reviewing the question of energy prices?
§ Mr. HowellThe hon. Gentleman is really asking whether electricity for large users should be sold below cost. If it is sold below cost, the taxpayer will have to pick up the bill or there will have to be higher public spending, which will mean higher interest rates, which will mean loss of jobs. The hon. Member cannot have it both ways. Either he wants lower public spending and economic pricing or he wants a mass of subsidies, which would be the quickest way of all to destroy British industry.