HC Deb 10 December 1990 vol 182 cc650-1
13. Mr. Haynes

To ask the Secretary of State for Energy when he next expects to meet the chairman of PowerGen to discuss privatisation.

Mr. Wakeham

I meet the chairman of PowerGen regularly to discuss all aspects of PowerGen's business.

Mr. Haynes

Mr. Speaker, Sir, I welcome the Secretary of State's comments about the miners and the mining industry, and the wonderful contribution that they are making to meet the energy requirements of the nation. Is the right hon. Gentleman aware that there are two chairmen—the chairman of PowerGen, who is leaving us in a few months, and the chairman of National Power, who has already gone—and will he think seriously about the amount of compensation paid to those two people? Will he take that into consideration when miners lose their jobs in the pits due to privatisation of the electricity industry and will it have a knock-on effect so that miners who are made redundant can enjoy like compensation?

Mr. Wakeham

As I have already said, the great improvement in productivity in the mines has been brought about in part by the number of redundancies that we have made, but all those redundancies have been made on a voluntary basis. I hope that that basis can continue, but that is a matter for British Coal and the workers concerned, and the levels of compensation are matters to be negotiated between them—as, of course, is the question of compensation paid to the chairman of a nationalised industry or Government company when he retires. The Government have always worked on such a basis—we seek to find a sum equivalent to the amount that would be awarded if the matter went to court.

Mr. McCartney

There is almost a conspiracy of silence in the Government about the effect on the coalfield communities of the purchasing policies of companies such as PowerGen and National Power. Those communities are experiencing thousands upon thousands of job losses, and a dislocation of environmental and economic well-bing. What steps will the Government take to assist local authorities and the private sector to rebuild and re-establish those communities?

This winter, in my constituency, hundreds of miners are being made redundant, and thousands have already been made redundant. How long will it be before our communities have been bled dry on the altar of privatisation? The Government cannot continue to wash their hands of the matter. When will the Minister intervene to provide resources for the rebuilding of our shattered communities?

Mr. Wakeham

The hon. Gentleman expresses views which are strong but not necessarily accurate. Far from hiding a light under a bushel, on the day contracts were negotiated between British Coal and the generators I came to the House and announced the details—I was very proud of what had been achieved by British Coal and by the generating industry. I also paid considerable tribute to the way in which British Coal and its work force had adapted to the new situation. There has been a vast improvement in productivity—to which I would expect the hon. Gentleman to give credit, rather than making carping remarks—and the redundancies that have been made have all been on a voluntary basis, for which we should all be grateful.

Mr. Morgan

I have heard the words "successful privatisation" reiterated so often by the lemming tendency on the Conservative Benches that I almost expected to see the Secretary of State for Energy dressed in his Santa Claus uniform. He obviously believes that a major tax cut for the yuppy classes has come early this year in the form of privatisation, in time for them to buy their Christmas presents. It has been described, not by me but by the Lex column of the Financial Times this morning, as a fraud on the taxpayer. When the Secretary of State privatises the generators next February or March, will he have learnt anything? Does he consider that when he privatises the generators it will be necessary to discount them by 40 per cent. and put them on a running yield of more than 30 per cent., thus privatising our major national assets at junk bond prices?

Mr. Wakeham

The hon. Gentleman does not understand these matters. That is evident from the way in which he put his question. The price being placed on the 12 electricity companies is a proper price, based on the value of expected future earnings and dividends.

Mr. Morgan

What about fraud?

Mr. Wakeham

If the hon. Gentleman is seriously interested in fraud, I could answer his question, but the way in which he prefaced it suggests that he knows very little about fraud. There is of course the question of fraud. We are very careful about fraud and take it very seriously indeed. We have developed highly sophisticated methods to detect fraud. We have learnt lessons from the previous flotations. That may come as news to the hon. Gentleman, who seems to leak information of a partial sort to the newspapers. I would not disclose publicly the methods used to detect fraud, as it might assist criminals.