British Coal (Hansard, 26 March 1990)

§ 13. Mr. O'Brien
To ask the Secretary of State for Energy when he last met the chairman of British Coal; and what was discussed.

§ Mr. Wakeham
I meet the chairman of British Coal regularly to discuss all aspects of the coal industry.

§ Mr. O'Brien
During the right hon. Gentleman's latest discussions, did the chairman of British Coal outline the concern of people working in the mining industry and those in the mining communities about the 30 per cent. increase in electricity prices between April 1988 and 1990, with further increases to come? Those increases have occurred despite the fact that coal prices have remained the same or, in some cases, even been reduced. Is not the only purpose of such increases to fatten the bottom line of the CEGB's accounts? Is not that screwing the miners, the old people and the domestic customers? When will the Secretary of State ensure that customers, including the miners who produce the coal, obtain a fair deal?

§ Mr. Wakeham
I did not discuss that matter with the chairman of British Coal, but I did discuss the advantages for the coal industry of the passing of the Coal Industry Act 1990, which provides £5 billion to £7 billion of grant that will enable the coal industry accounts to be cleared of the hangover of past debts and will provide a good basis for the future. In addition, British Coal has secured a 12 three-year contract with the generating industry at prices which, I hope, will enable it to be the supplier of first choice in the long term.

§ Mr. Hind
Does my right hon. Friend agree that the contracts between the electricity industry and British Coal are an extremely good deal for British Coal? Will he convey that view to its chairman? Does he—

§ Mr. Speaker
Order. One question please—that is only fair.

§ Mr. Wakeham
It is a good contract for British Coal and for the generators. The important matter is that it is still a tough contract for British Coal. Although it has made great strides—productivity is up by more than 75 per cent. on pre-strike levels—further productivity gains are essential. I believe that the industry has the technology, investment and skills to achieve that.

§ Mr. Hardy
Does the Secretary of State accept that the chairman of British Coal should have told him that the pursuit of international supplies of low-sulphur coal could be a wild goose chase? Will he explain to the chairman of British Coal the precise nature of the mathematical formula which The Daily Telegraph told the world the right hon. Gentleman was capable of explaining to the House and the public?

§ Mr. Wakeham
The answer to the mathematical formula is 10.6 per cent.—the fossil fuel levy.

§ Mr. Cummings
Is the Secretary of State aware of the chairman's recent remark that the north-east area is the jewel in the crown of British Coal? In view of that, does he agree that it is time to embark on a massive programme to fit flue gas desulpurisation equipment to make the importation of low-sulphur coal unnecessary?

§ Mr. Wakeham
I will not discuss which area of British Coal's activities is the jewel. There are many hardworking and highly skilful miners all over the country. I have nothing further to add to what my hon. Friend the Under-Secretary of State said recently about FGD. We are committed to the European directive. It is clearly laid down and we shall ensure that it is achieved. British generating companies are considering their plans for how best to implement it. My view is that they will implement it partly by fitting FGD, partly by switching to some new stations for gas burn and partly by importing low-sulphur coal.