§ The Earl of LAUDERDALEMy Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
§ The Question was as follows:
§ To ask Her Majesty's Government what is the annual investment needed to develop the Selby coalfield during the next 10 years and whether they will state how it is proposed to fund this.
§ Lord STRABOLGIMy Lords, over the next 10 years annual investment in the Selby coalfield is estimated to vary between £10 million and £60 million per annum at March 1976 prices. The expenditure will reach a peak in the early 1980s, before declining as the project nears completion. The estimated total capital cost is around £400 million. The investment will be financed from both internal and external sources. The external sources include loans from the National Loans Fund, the Commission of the European Communities and the European Investment Bank.
§ The Earl of LAUDERDALEMy Lords, in thanking the noble Lord for that reply, may I ask him this question? Are we to understand, therefore, that at any rate part of the funding of this very necessary operation will fall upon the public sector borrowing requirement?
§ Lord STRABOLGIMy Lords, one of the keys to improving productivity in the coal industry is the greater use of advanced techniques of mining; and the new mines, such as Selby, will, I think, provide an excellent investment.
§ The Earl of LAUDERDALEMy Lords, may I ask the noble Lord to answer my supplementary question, which was whether or not some part of this funding will apparently fall on the public sector borrowing requirement?
§ Lord STRABOLGIMy Lords, I must ask the noble Earl to be patient, if he will, until the new Plan for Coal is published early next year—the Government hope to publish it in January—when full details will be given.
§ Lord POPPLEWELLMy Lords, could my noble friend give any indication so far as investment in housing in Selby is concerned? Will that be undertaken by the Coal Board, or will it depend upon the local authorities? I ask that very personally since I live in this area and the actual drift-mouth of the coal mine is coming out in my particular parish. The authorities are very concerned about the housing situation. They want to see preparations made for the people who will come to reside among us, whom we shall welcome very much indeed.
§ Lord STRABOLGIMy Lords, I cannot give my noble friend details, but I will ask him to be patient until the report comes out next year. I can tell him, however, that not only is Selby a seam with tremendous possibilities but it is also one where the country's energy needs can be met at very low real costs with adequate regard for environmental and social considerations.
§ Lord REIGATEMy Lords, is not the answer to the question posed by my noble friend Lord Lauderdale, "Yes"?
§ Lord STRABOLGINot necessarily, my Lords.
Lord PAGET of NORTHAMPTONMy Lords, in view of the difficulties involved in financing Selby, can we be assured that even larger financial liabilities will not be taken on in the Vale of Belvoir until we have dealt with Selby? Indeed, is it not somewhat feckless, when we have North Sea oil coming in and Selby coming in, to proceed to rifle all the reserves of a future generation?
§ Lord STRABOLGIMy Lords, some money may be borrowed for Selby in 1179 particular, but in general the Board borrows to meet that part of its overall capital requirements that it cannot finance itself. The Board is aiming at a sub-stantial contribution to its capital investment programme from its own resources. The expenditure on Selby is expected to be recovered within a few years of the completion of the mining construction. With regard to Belvoir, I think it would be premature for the Government to state their attitude towards a project for mining the coal there, although they welcome the discovery of reserves under the Vale of Belvoir.
§ Lord POPPLEWELLMy Lords, is my noble friend aware how very much the attitude of the National Coal Board is appreciated by the responsible people in that area? Its opening up of this new field of energy, and the way it has dealt with local authorities and every interest concerned, is an object lesson that could well be followed by large-scale industry in any new venture.
§ Lord STRABOLGIMy Lords, I shall certainly pass on my noble friend's remarks to my right honourable friend.
§ Lord SLATERMy Lords, is my noble friend aware that many of us are waiting anxiously for the day when the first sod is cut in this new area, where this new productivity is to take place by way of the extraction of coal? In view of what has happened in my own coalfield of Durham, where coalmining is a dying industry, and in Northumberland and in South Wales, this is a great asset which must be utilised and explored on behalf of the nation as a whole. Furthermore, would my noble friend not agree that we all ought to be grateful for the privilege and opportunity of bringing this new asset, this new coal-field, into production on behalf of the nation?
§ Lord STRABOLGIMy Lords, I am grateful to my noble friend for what he has said. The reserves at Selby recoverable through the present scheme have been estimated, I am sure the noble Earl will be glad to hear, at 240 million tons. Work officially began on the construction of this great complex last October. Production should begin in the early 1980s and full production of 10 million 1180 tons per annum be reached in the second half of the decade. In this way, Selby has the potential to fulfil half of the required "new mines" production plans for coal. This is something of which we should be proud.
§ Lord HAILSHAM of SAINT MARYLEBONEMy Lords, in view of the supplementary question put by the noble Lord, Lord Slater, and the answer given, would the noble Lord consult the right reverend Prelates as to to whom we ought to be grateful, rather than the Government?
§ The Earl of LAUDERDALEMy Lords, would the noble Lord accept that we are all much encouraged by the splendid prospectus that he gives for this investment? But would he not accept that the funding of this investment would be very much more profitable to the Coal Board and to the nation if it were not funded almost entirely by loan charges—including, evidently, a heavy imprest on the public sector borrowing requirement—but if equity in this excellent proposition were to be sold off to private enterprise such as Shell and other companies which have the cash flow to sustain it?
§ Lord STRABOLGIMy Lords, I am sure that my right honourable friend will note carefully what the noble Earl has advised.