COAL INDUSTRY BILL

HL Deb 25 July 1977 vol 386 cc737-57

2.48 p.m.

Report received.

Clause 10 [Activities relating to minerals other than coal or petroleum]:

Lord SANDFORD moved Amendment No. 1: Page 8, line 6, at beginning insert ("Subject to subsection (1A) below,").

The noble Lord said: My Lords, I beg to move this Amendment in the name of my noble friend Lord Long and myself. Perhaps I should start by reminding the House of the stage we have reached on this Bill. In some respects particularly in respect of Clauses Nos. 1 to 8, one could say it was a normal Coal Industry Bill in that it increases the National Coal Board's borrowing powers and makes available a further range of grants. However, it is not all that normal because it increases the borrowing powers from £1,100 million to £2,600 million without further recourse to legislation. That in itself is significant enough, and on top of that it increases the grants available to the Board by anything from £325 million to £475 million, again without further recourse to Parliament.

We do not quarrel with that because that recognises the future significance of this large indigenous source of energy in an energy-hungry world. However, there are two abnormal features about this Bill, and both of them are wide extensions of the National Coal Board's operations, first, into the petro-chemical industry—that is dealt with by Clause 9—and into the mineral industry, other than coal and petroleum, which is dealt with in Clause 10.

On Committee, I moved and pressed an Amendment which would require the Board to secure approval of the Secretary of State before entering into the petrochemical field, and on Clause 10 we had a wide-ranging but inconclusive debate, in the course of which the noble Lord, Lord Strabolgi, gave a number of assurances which I was seeking for the mineral industry and which I welcomed. But I urged the noble Lord to do what he could before this stage to incorporate those assurances into the Bill. He undertook to do that. I know that he has given the matter thought, but he has not found it possible to incorporate the assurances into the Bill.

It is to this matter that we now need to return, but the proceedings at the Committee stage led me to suppose that there are two matters which I ought to deal with briefly by way of preliminary. The first is to make it quite clear that in moving these Amendments we are not expressing a general opposition to nationalisation. I certainly admit that my noble friends and I are not as fond of nationalisation as are some noble Lords opposite, but that is not what we are concerned with now. We have learned to live with nationalisation in the same sort of way as noble Lords opposite have learned to live with the private sector of industry and a mixed economy. But we are concerned to make the point that use of the wide powers that are now conferred by this legislation on the National Coal Board is not just a matter for the Board's own commercial judgment but requires the approval and sanction of the Secretary of State in his judgment of the national interest, and the approval of someone who is answerable to Parliament. As we have just heard, in no less than two of our four Questions, the Secretary of State is not answerable for the day-to-day management of the nationalised industries.

The second point I have to deal with was the contention from several noble Lords opposite that we could entirely rely on the exercise of the Minister's financial control over the National Coal Board, as with all other nationalised industries. Our point is that financial control is one thing and day-to-day management is another, but in this respect the Minister needs the kind of powers which have been conferred on him by Parliament on many occasions since the nationalisation of coal. In the first instance, he has a number of powers to direct the Board in addition to his financial control in Clause 3, and that is continued right up to 1981, and in Clause 7 he is given further powers of direction over the Board to discontinue or to restrict any of their activities, such as the ones we are talking about now. This is the context in which I want to deal with these Amendments—

Lord STRABOLGI

My Lords, I am sorry to interrupt the noble Lord. Will he tell us which Amendments he is speaking to? It would be useful.

Lord SANDFORD

My Lords, I am speaking to ail the Amendments at the moment, though, of course, I have moved only Amendment No. 1.

Lord STRABOLGI

My Lords, I do not think the noble Lord has yet sought the permission of the House. Will he tell me exactly which Amendments he is speaking to? For my part, I should be happy if he were to take Amendment No. 3, perhaps, with Amendment No. 1, if he wishes to do so; and then perhaps Amendments Nos. 2, 4 and 6. In my judgment, Amendment No. 5 is slightly different.

Lord SANDFORD

My Lords. I am grateful to the noble Lord. I was speaking and I will speak, if I may, for a few more moments to all the Amendments, describing the context in which we are considering them. I will then return more specifically to Amendment No. 1 and link it, as the noble Lord suggests, with Amendment No. 3. I would then suggest that we might subsequently return to Nos. 2, 4, 5 and 6. I shall be quite happy to say more about Amendment No. 5, if the noble Lord wishes, when we come to it.

Still speaking at the moment to Amendments Nos. 1 to 7, standing in my name, what I am seeking in this connection is the incorporation of assurances into the Bill—assurances which have been given at various earlier stages of the Bill by the noble Lord and his colleagues. I am doing this because the noble Lord has not so far been able or willing to do so. I am doing it not because we do not trust the assurances of the noble Lord or of his honourable friend the Parliamentary Under-Secretary, but we have to face the fact that they may not be in office for ever—or, indeed, for all that long. They cannot bind their successors and they do not control the day-to-day management of the nationalised industries. I would put it to the House that, as legislators, our duty is to ensure that, whenever possible, all significant factors relating to new legislation are written firmly into the Bill. That is what we should always be concerned to do, and that is what my noble friends and I are concerned to do now.

The only other preliminary point I have to make is that these points are significant enough to be incorporated in legislation. I believe that to be the case, and I shall just spend a moment or two seeking to show why. As I say, Clause 10 gives the National Coal Board the power: to work and get any minerals, other than coal or petroleum, which are discovered in the course of searching or boring for, or working and getting coal …". Those are certainly very wide powers. Among the minerals most commonly or most likely to be encountered by the National Coal Board in those processes of searching and boring for coal are the bulk minerals such as whinstone, limestone and extensive deposits of sand and gravel. These, as well as providing a number of valuable raw materials for the steel and chemical industries, also provide the aggregates, the main sinews of the housing, building and construction industry. That is the aspect on which I shall concentrate almost entirely.

This industry is, as your Lordships know, currently working very far below capacity and its suppliers are therefore in considerable difficulties. If the industry is to survive and surmount these difficulties and to be in a position to continue to serve the construction industry, it must be assured of some sort of protection from intrusion into a very competitive and, at present, very vulnerable field from a body like the National Coal Board, coming, as it does, with an accumulation of advantages of the kind conferred upon it by this Bill, amounting, as I said just now, to no less than £325 million-worth of grants of various kinds. The lack of assurances for the industry in such a situation will cast its shadow ahead long before the National Coal Board actually uses these new wide powers and, in our view, it would soon begin to impair the ability of the mineral industry to raise funds on the market, to retain staff and to continue investment.

Although the Parliamentary Under-Secretary and the noble Lord, Lord Strabolgi, have shown their awareness of this danger—that is certainly true—and although they have given us assurances which go far to meet the anxieties of the industry, we have one further job to do, which is to give those assurances permanence and substance, and to do so by moving them into the Bill.

After those preliminaries, which I hope the noble Lord will feel were called for, I should like to turn specifically to Amendment No. 1 which I am moving, and Amendment No. 3 which is linked with it. These two Amendments do no more than incorporate in the Bill the suggestion made by the noble Lord, Lord Hughes, at the end of our Committee stage, as his way of giving more Parliamentary control over the approval of the Secretary of State than I had myself envisaged. There were some noble Lords, speaking at the Committee stage, who thought that it would not be sufficient for the approval of the Secretary of State to be given prior to the exercise of these powers, but that they should be subject to Parliamentary control as well. I move Amendment No. 1, and link with it Amendment No. 3, as a way of doing that, but more as a probing Amendment to get the reaction of the noble Lord, Lord Strabolgi, to his noble friend's suggestion, before I go on to move Amendment No. 2 and speak to the remaining Amendments with it. My Lords, I beg to move.

3.1 p.m.

Lord STRABOLGI

My Lords, I was waiting in case any other noble Lord wished to take part. I am grateful to the noble Lord, Lord Sandford, for putting down these Amendments, because it gives the House an opportunity to consider this very important matter further. It also gives me the chance to spell out briefly the possible sequence of events if the National Coal Board decide that they wish to work a mineral under the powers to be conferred by Clause 10, and to consider these in the light of the proposals which the noble Lord has put down for amendment.

Assuming that they have discovered some deposit as a result of searching or boring for coal, the Board would first have to assess whether the project was likely to be economic. This would mean taking into account not only the size of the deposit, the ease with which it could be worked and the amount of investment that would be required, but also the current and prospective demand for that kind of mineral and the extent to which the demand was already being met. Assuming that the Board decided in the light of this assessment that the project was sufficiently attractive in commercial terms, they would have to go through further stages.

First, if the mineral was an aggregate—that is, sand, gravel or rock, such as limestone suitable for crushing—and if the date was within five years of the passing of the Bill, the Board would be obliged to honour the undertaking already given, and notify the representatives of the bulk minerals industry of their intention. If the industry was concerned about the impact on their business, they would make representations to the Board and there would be discussions between the parties. The Board would still have to secure the rights to work the mineral and, as I have already explained in Committee, the Board would be in no more favoured position than anyone else in this connection.

Of course, they would also have to secure planning permission in the normal way. The planning process itself allows for existing spare capacity in an industry to be taken into account before a decision on the application is taken. The Amendment proposes to add to this process that the Board must then put their proposal to work a surface mineral deposit—otherwise, of course, than in association with coal getting—to the Secretary of State. The Amendment does not itself make clear whether this is to be done before or after securing planning permission. The Secretary of State has then to make an order which is to be subject to Negative Resolution of either House.

The Amendment does not make any exception in the case of proposed projects. It might be that the bulk minerals industry would have raised no objection, and that the planning approval had been obtained without any questions about existing spare capacity being raised. But under the Amendment the Board would still have to go to the Secretary of State, who would still have to make an order, and Parliament would still have to scrutinise it. But I submit that this reference to Parliamentary scrutiny raises another question on the Amendment, of what considerations Parliament would take into account in deciding whether or not to seek the annulment of an order. Would either House be able to come to a decision without setting up Committees to take evidence from the National Coal Board and from the minerals industry, if there were objectors The Amendment would apply, too, to all proposed working of surface minerals not in association with the getting of coal, however small. As has been said more than once, the National Coal Board are not expecting to utilise the power in Clause 10 to a significant extent to extract surface aggregates. The projects which they might wish to undertake could be quite small, and yet the Amendment would require them to be considered first by the Secretary of State, and then by both Houses of Parliament. I suggest that this would be a cumbersome procedure out of all proportion to the magnitude or significance of the likely use of the powers under Clause 10.

The noble Lord, Lord Sandford, spoke about lack of assurances. During the Committee stage, I explained the Government's and the National Coal Board's appreciation of the present difficulties through which the bulk minerals industry is passing. I said that neither the Government nor the Board has any wish to aggravate those difficulties. I repeated the assurances that had already been given in another place by my honourable friend, and I also repeated the assurances that had been given by me on Second Reading in your Lordships' House: in particular, that it was considered by both the Board and the Government extremely unlikely that the powers in Clause 10 would be used to a significant extent to excavate aggregates by opencast methods. I referred to the procedure for notification to representatives of the bulk minerals industry during the next five years, so that account can be taken of any continuing concern they may have before the Board embark on a surface minerals project not associated with the getting of coal.

In the light of the discussion in Committee, the Government have considered whether by means of amendment to the Bill, or in other ways, they can go further than this. I have to report that the Government's firm and considered view is that, together with the National Coal Board, they have gone a long way to reassure the bulk minerals industry, and that in the light of the assurances given it is surely unreasonable for the representatives of the industry still to be expressing concern. If they will read and weigh carefully what has been said, I think they will come to realise that their essential interests are not being assailed, that there is no risk of any significant loss of business to the National Coal Board, and that there are no grounds for fearing that Clause 10 will lead to any loss of business confidence. In the Government's view, therefore, it is unnecessary to make the exercise of the power in Clause 10 subject to the various changes proposed in the Amendment. I therefore hope that the noble Lord will withdraw the Amendment or, if he does not do so, that the House will not accept it.

3.9 p.m.

Lord LLOYD of KILGERRAN

My Lords, in view of the emphasis which the noble Lord. Lord Strabolgi, has placed on the fact that, as it seems to me, there will be no risk of loss of business in any circumstances whatsoever, I am encouraged to put to the noble Lord a question that was asked of me only on Saturday in the very far West of Wales. The news had percolated even there, that I had spoken briefly on Second Reading and at Committee stage on this matter. I was present at an historic occasion, and the noble and learned Lord, Lord Morris of Borth-y-Gest, who is in his place, was also in Aberystwyth, when His Royal Highness the Prince of Wales was introduced as President of University College Wales, in the presence of his father the Duke of Edinburgh.

I was asked the following question about a farmer in Ceredigion, who struggles to wrest a living out of the land in very difficult conditions: "If a man had an interest in a gravel and sand excavation business and if he had been excavating gravel and sand for a number of years, would the Coal Board be allowed to come along and start boring near to that business to find out whether there was any coal there?"

May I ask the noble Lord the Minister whether he is able to give an assurance that where there is an active sand and gravel business in a rural area, particularly in West Wales, a limitation on boring will be placed upon land near to that business? If the Coal Board were to make borings for coal and found coal near to an active business, what would be their reaction in relation to that business and their application for planning permission? I ask this question, in view of the emphasis which the noble Lord has placed on the fact that there will be no risk of loss of business to any active gravel and sand operation. In parts of Wales there is anxiety that, in all honesty and sincerity, the Coal Board may come within a mile of an opencast gravel and sand working, find some coal and then wish to go into business. Surely an assurance ought to be given by the Minister that no exploratory boring for coal should be made within five or 10 miles of an active sand and gravel pit.

Baroness LEE of ASHERIDGE

My Lords, before the Minister replies to the question which has just been asked, I wonder whether he could explain to me why there is one law for private industry and another for the nationalised industries. Can the Minister explain why when coal was nationalised the Conservative Members of another place fought day and night to prevent the National Coal Board from expanding into profitable by-product industries? I am sure that the Minister is aware that miners feel deeply about the restrictions that were then placed upon the Board—just as, at that time, they felt that members of the Conservative Party managed to secure what many of us considered to be too high compensation terms. It looks as though the same story is being repeated all over again, in reverse. Apparently, there is to be a tender list, and protection is to be given to private industry that was never given to the nationalised industries. Is it not part of the philosophy of free enterprise that good competition is good for everybody and that if private business expands they will be great patriots and will probably help the export trade? If, on the other hand, a nationalised industry is likely to increase its profits, which in turn come back to the taxpayer, it seems that the most tender care must be taken to ensure that its activities do not encroach upon any possible profits that can be made for private industry. I am not advocating chaos. We want our industries, both private and public, to be properly organised. However, I should like to know why there is one law for private industry and another for nationalised industries.

Baroness WARD of NORTH TYNESIDE

My Lords, before the Minister replies, may I put on record that I disagree with everything that the noble Baroness has said. It would be a pity if even that little statement on my part were not put into the record. I have no intention of going into all the answers, although I know them very well. Naturally, the noble Baroness believes in nationalisation and I think that she would like to extend it. I do not believe in nationalisation. When people read debates they do not take quite so much notice of them as they would take of an Act of Parliament. I hope that when the noble Lord replies he will remember that I do not agree with the noble Baroness. I should like certain things to be put into the Bill so that, when people are interested enough to find out, they can look at what is contained in the Act instead of having to look at what either I or the noble Baroness have said.

Baroness GAITSKELL

My Lords, may I intervene for a moment, because I cannot stay until the end of the debate. Is this not the usual reaction of noble Lords opposite when there is the slightest hint of the sweet smell of profits for the nationalised industries? Their reaction is not new; it has always been the same. The moment that there is the chance of a nationalised industry doing anything that will show a profit, the noble Lords opposite are against it.

Viscount MASSEREENE and FERRARD

My Lords, if the nationalised coal industry cannot make a profit out of coal, it is extremely unlikely that they will make a profit out of gravel and sand.

Lord DRUMALBYN

My Lords, I hope that the noble Lord will tell his noble friend Lady Lee of Asheridge that one reason why nationalised industries are different from other industries is because public money has to be voted for them and that the National Coal Board was set up specifically to deal with coal. This was the purpose of the Act. I do not want to develop the argument. We are not saying, as the noble Baroness, Lady Gaitskell, appears to suggest, that the coal industry should not do this under any circumstances; only that they should require the permission of the Secretary of State before they do it. That is the purpose of the first Amendment which we are discussing.

I should like the noble Lord to be a little more specific about what he has said. He has spoken as though this were a question of only surface minerals. That is not what the Bill says. It states in Clause 10 that: The Board shall have power—(a) to work and get any minerals, other than coal or petroleum, which are discovered in the course of searching or boring for "— I am not concerned at the moment with the words "working and getting"— coal". That would not necessarily imply surface working. In the course of boring, the Board might discover other minerals, not just aggregates. If that were so, surely it would be imperative that the approval of the Secretary of State should be obtained. Nor are we saying in these Amendments that the approval of Parliament has to be obtained. It is made subject to the Negative Resolution procedure. In other words, it is tacit approval if it is not opposed. Therefore the kind of consideration which the noble Lord has in mind does not apply. It might conceivably apply if there were a Negative Resolution and if, in the course of the debate, it were shown that all of the considerations had not been taken into account. Then it might be said that a committee ought to be set up if the House so decided, and it would certainly be highly desirable that further consideration should be given to the question in one form or another.

I do not think the noble Lord has made a comprehensive case against this Amendment. If it were a minor matter there is no doubt the approval would be easily given. If the noble Lord says, "At what stage should it be given?" I should think the prudent thing would be for it to be given before the request for planning permission, because from that there arise other considerations altogether. But under this Amendment it does not really matter at what stage it is given. No doubt it would be for the Government to lay down when the Secretary of State would consider this matter and give his approval. So I do not think the noble Lord has made a case at all. In the first place, he has made it on the basis that this would relate only to surface minerals, whereas it might relate to other things: it might relate to uranium or lead or even precious metals if they happen to be found in the course of boring. That being so, it seems to me imperative that the Secretary of State should be involved in a matter which obviously concerns the national interest.

Lord LEE of NEWTON

My Lords, it seems to me that we are again rehearsing some of the discussions that we had at the Committee stage. In the main I should have thought there were very few minerals or other materials which are found, or even looked for, below the level of the coal measures; in other words, we go through most minerals and other materials, such as sand, gravel, et cetera, while we are looking for coal. The noble Lord, Lord Lloyd of Kilgerran, raised an interesting point when he asked whether, when a gravel or sand pit was functioning, the Coal Board should be barred from sinking a shaft within a certain distance. Some of the greatest tragedies in the coal industry in this country have arisen because the shafts were sunk in the wrong places. That has caused literally hundreds of deaths. Therefore, I should have thought that one must look at that angle. I see the noble Lord's point clearly. As I think we all agreed in Committee, nobody wants the Coal Board to interfere with a successful enterprise which is doing a good job of work. On the other hand, if we are to prohibit the Coal Board from sinking its shafts in the best places the accident rate will rise.

I have made the point that coal is probably in the lowest measures that we ever drill in this country and it follows that on many occasions other types of minerals, and so on, will be found. I may be wrong, but in the days when I had something to do with this work I believe there had never been a geological survey of Britain. We did not know what was below the surface and when we were boring for coal we came across other things.

Supposing the Coal Board are putting a bore through, as indeed at the Selby coalfield which is now going to be developed, and supposing they come across extensive reserves of sand or gravel, are they really going to be prohibited from moving that sand or gravel or anything else they come across until all the procedures of the inquiry are complete and planning permission is obtained? Are they going to be held back in the exploitation of some of the biggest coal reserves that Britain has, at the very moment when we are all convinced that there has to be a wide expansion of our coal production if we are to surmount the energy crisis which is upon us?

I do not want to see, any more than the noble Lord opposite does, any deviation of the Coal Board from their main purpose, especially if it is going to disrupt any other industries, but I do ask that the Coal Board will not be disrupted either, because the odds are that they will work far more in that direction than in the other. I should have thought that what my noble friend has said about co-operation and discussions as between the Coal Board and other industries is a very good way of beginning the operation. I am sure the noble Lord does not want to hold up vital developments at Selby and at other coalfields which are now to be developed while the argument and discussion goes on, possibly for months and even years, before the Caol Board are permitted to exploit a very fine reserve which has now been discovered. For these reasons I hope the noble Lord will not press the Amendment.

Lord SANDFORD

My Lords, I am most grateful to the noble Lord, Lord Lee of Newton, because I think his remarks have moved the discussion into the area where we on this side of the House certainly wanted it to be. While those thoughts are before us, I should like to confirm that we are not seeking to prohibit, or even greatly to restrain, the exploitation of minerals by the National Coal Board, but just to regulate the conditions of competition in which it is done and, furthermore, to do it in the terms which the noble Lord has suggested by the assurance that he has given. What we are seeking to do is to incorporate those assurances into the Bill.

Before I go on to say what I propose about Amendment No. 1, perhaps I might say to the noble Baroness, Lady Lee of Asheridge, that certainly private industry thrives on competition but one only has to look at this particular Bill to see how unfair competition with the National Coal Board would be, in view of the fact that by this Bill alone they are accorded grants of between £325 million and £475 million. That is not the kind of thing that comes the way of private industry. That is why one has to adopt—

Baroness LEE of ASHERIDGE

My Lords, I must take the noble Lord up on that point, because a great deal of public money is now also going to private enterprise.

Lord SANDFORD

For these reasons matters have to be regulated and we are not in the position of a purely free market economy. The noble Lord, Lord Strabolgi, was invited to reply to various noble Lords, but in fact it is my Amendment and I have to reply to this particular debate. No doubt, the noble Lord, Lord Strabolgi, will answer those noble Lords who asked him questions in whatever way he sees fit. I do not feel that it is my job to do that.

Turning specifically to Amendments Nos. 1 and 3, having listened to the noble Lord I am persuaded that to introduce the Negative Resolution procedure of Parliamentary control on top of the approval by the Secretary of State would probably be cumbersome in this particular case, and I would prefer to rest matters on requiring the approval of the Secretary of State without this procedure when we reach Amendment No. 2. I tabled Amendments Nos. 1 and 3 because I felt I owed it to the noble Lord, Lord Hughes, who had intervened in our Committee stage debate in such a helpful way, but having listened to what the noble Lord, Lord Strabolgi, had to say I beg leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

3.28 p.m.

Lord SANDFORD moved Amendment No. 2: Page 8, line 6, after ("power") insert ("subject to the approval of the Secretary of State").

The noble Lord said: My Lords, I have spoken to this Amendment already so there is not a great deal more to be said, except to confirm that in moving Amendments Nos. 2, 4, 5, 6 and 7 we are not seeking to do any more than to incorporate in statutory and legal form what the Minister and his noble friend Lord Strabolgi have said in so many words in the course of the assurances that they have given on this Bill. Amendment No. 4 incorporates the assurances which the noble Lord gave at columns 121, 122, 124 and 125 of the Official Report, at the Committee stage. It requires the Minister to be the judge of the demand on the mineral industry, to consult with the Secretary of State for the Environment, and to come to his view as to what is commercially reasonable and in the national interest. That being so, it seems inappropriate to have in line 21 the terms which in the opinion of the Board is calculated to facilitate the proper exercise of their powers because we are asking the Secretary of State to come to that judgment; and that is the reason for Amendment No. 5.

Amendment No. 6 incorporates what the noble Lord has more than once said about the notification procedure. He spoke as though this procedure was prescribed somewhere, but of course it is not; all we are seeking to do is to prescribe it in the Bill, and this is what we have done. I am not conscious of having added anything at all to the assurances that the noble Lord gave, only of having incorporated them in the Bill. I hope that the House will feel that Amendments Nos. 2, 4, 5, 6 and 7, all hang together and that we need not have separate debates upon each one of them: but, of course, if noble Lords have any further questions about the details of each individual Amendment, I shall be happy to try to answer them. I beg to move Amendment No. 2.

Lord STRABOLGI

My Lords, I should like to deal first with Amendment No. 2, and to explain why this Amendment achieves nothing of significance beyond what is already on the Statute Book. Under Section 1 of the Coal Industry Nationalisation Act 1946, the National Coal Board is charged with certain duties relating to the mining and supplying of coal. Nothing in this Bill, let alone this clause, derogates from those duties; and nothing in this clause enables the Board to undertake anything which could interfere with its performance of those duties.

Secondly, controls over the Coal Board's activities already exist through agreed procedures governing its planned expenditure. Every year, the Coal Board provides to the Government its survey of its plans and forecasts for the industry during the following five years. This is discussed between the Department of Energy and the National Coal Board; and ministerial approval is subsequently sought for the level of capital expenditure, broken down into mining and non-mining activities, to be undertaken by the Board. This arrangement has a formal basis in the Coal Industry Nationalisation Act. Section 3(2) of that Act states that: In framing programmes of reorganisation or development involving substantial outlay on capital account, the Board shall act on lines settled from time to time with the approval of the Minister. If and when the National Coal Board plans to invest in operations for extraction of other minerals, the sums involved will be included in its five-year forecasts and the Secretary of State and his Department will be able to discuss with the Board the nature and extent of the proposed operations. The sums involved will then be included, provided that the Secretary of State is satisfied with the Board's plans, in the maximum level of capital investment that the Board may undertake in the following year.

Another statutory provision bearing on this Amendment is the power included in Sections 6 and 7 of the Coal Industry Act 1971, passed by the Conservative Government, which enables the Secretary of State to call for a report by the Board on its non-colliery activities and to direct the Board to discontinue or restrict any of its activities or to dispose of any assets, provided that the activities or assets are not necessary to the discharge of its duties. I should emphasise that I do not foresee the situation arising where this power might need to be used, but nevertheless it remains on the Statute Book and helps to make this Amendment unnecessary.

A third statutory provision bearing on the Amendment is that all borrowings by the Board and by its wholly-owned subsidiaries count against the statutory borrowing limits. The Board's borrowings from the National Loans Fund are controlled by the Government, and the Board's borrowings from other sources, and its power to lend to subsidiaries and its power to provide financial guarantees, are subject to the controls set out on pages 12 and 13 of the Bill. So much for Amendment No. 2, which, I submit, is not necessary.

With regard to Amendment No. 4, to which the noble Lord, Lord Sandford, was also speaking, as I have already explained, the Government do not think it necessary to go beyond the extensive assurances already given. This particular Amendment would require the Secretary of State, before giving approval to the Board to go ahead in the case of projects as defined in the Amendment, to have regard to the overall demand on the capacity of the mineral industry.

In the course of the Committee stage, I said that the Government and the National Coal Board recognised that the bulk minerals industry was currently working well below capacity. I have said so again this afternoon. I added that it was implicit in the assurances already given that, while demand for aggregates remained well within the capacity of the industry, the Board would not use the powers under Clause 10 to any significant extent in working surface aggregate minerals otherwise than in association with the working and getting of coal. Therefore, I submit that these two Amendments are not necessary.

3.37 p.m.

Lord DRUMALBYN

My Lords, the most puzzling thing about what the noble Lord has said is that, given the powers and the duties that the Coal Board already have, it remains difficult to see why this additional power should be required at all. They are given power to deal with these minerals which they may discover in the course of boring, searching, working and the getting of coal. Can the noble Lords say why it is now necessary to provide this power at all, and in what circumstances that power is going to be exercised? He has been busy explaining how unlikely it is that the power will be exercised. Then why at this moment apply for powers for the purposes concerned? I find that very puzzling, and very difficult to understand. I hope the noble Lord will be able to answer on that.

I think it is very important to realise the distinction between powers and duties. This certainly does not give the Coal Board any duty to work minerals other than coal; it merely gives them a power to do so. The question we are concerned with is whether this should be an unfettered power or whether it should be subject to the control of the Secretary of State. The noble Lord says in reply that of course it is subject to the control of the Secretary of State because the capital plans have to be approved. If that is so, it seems to me extremely difficult to see why the board are applying for the power at all; but if they do apply for the power it seems to me to be necessary to have the approval of the Secretary of State. This is what the noble Lord has not really answered. He is merely saying that the capital investment applications will have to be approved, but he is not saying that particular exploitation in particular parts will require the approval of the Secretary of State, which, if I understand it correctly, is what this Amendment seeks.

Lord SANDFORD

My Lords, I do not think there is really all that much between us. I have not asked the noble Lord to go beyond the assurances which he has already given, and which for my part I regard as almost entirely adequate; at any rate not far from being adequate. He has reiterated and somewhat expanded an account of the procedures that he envisages will be used. He has reminded us of the powers of direction over the Board which were given to the Minister in the original Act of 1946 and in Sections 6 and 7 of the Coal Industry Act 1971, one of which is specifically concerned with these diversified activities. He has also confirmed yet again the power that the Minister exercises over the borrowings of the industry and over their five-year plans.

All of that is very useful and we are

grateful to the noble Lord, Lord Strabolgi, for it. However, he has not said why this cannot be incorporated in this piece of legislation, because that is what is needed to give these assurances permanence and substance. I do not think that there is any need to pursue the matter further. We are grateful for the assurances. All that we are seeking to do is to incorporate them in the Bill, and Amendment No. 2 is the first of a batch of Amendments which does that. I beg to move.

3.40 p.m.

On Question, Whether the said Amendment (No. 2) shall be agreed to?

Their Lordships divided: Contents, 105; Not-Contents, 58.

CONTENTS
Abinger, L.	Donegall, M.	Monk Bretton, L.
Addison, V.	Drumalbyn, L.	Montgomery of Alamein, V.
Airedale, L.	Effingham, E.	Mottistone, L.
Aldenham, L.	Elles, B.	Mowbray and Stourton, L. [Teller.]
Alexander of Tunis, E.	Elliot of Harwood, B.
Alport, L.	Emmet of Amberley, B.	Moyne, L.
Amherst, E.	Falmouth, V.	Newall, L.
Amory, V.	Foot, L.	Northchurch, B.
Amulree, L.	Gladwyn, L.	O'Neill of the Main, L.
Atholl, D.	Grey, E.	Rankeillour, L.
Avebury, L.	Hawke, L.	Redmayne, L.
Avon, E.	Hives, L.	Romney, E.
Balfour of Inchrye, L.	Home of the Hirsel, L.	Sackville, L.
Banks, L.	Hornsby-Smith, B.	St. Aldwyn, E.
Belstead, L.	Howe, E.	St. Davids, V.
Birdwood, L.	Hunt of Fawley, L.	Salisbury, M.
Blake, L.	Hylton-Foster, B.	Sandford, L.
Boyd-Carpenter, L.	Inglewood, L.	Sandys, L.
Byers, L.	Ironside, L.	Selkirk, E.
Camoys, L.	Jessel, L.	Sharples, B.
Carr of Hadley, L.	Kemsley, V.	Strathclyde, L.
Carrington, L.	Kintore, E.	Strathcona and Mount Royal, L.
Cathcart, E.	Lauderdale, E.	Strathspey, L.
Chelwood, L.	Lloyd of Kilgerran, L.	Sudeley, L.
Clitheroe, L.	Long, V.	Swinton, E.
Clwyd, L.	Loudoun, C.	Thomas, L.
Cornwallis, L.	Lucas of Chilworth, L.	Thorneycroft, L.
Craigton, L.	McFadzean, L.	Trefgarne, L.
Cranbrook, E.	Macleod of Borve, B.	Tweedsmuir, L.
Cullen of Ashbourne, L.	Malmesbury, E.	Vivian, L.
Daventry, V.	Marley, L.	Wade, L.
Davidson, V.	Massereene and Ferrard, V.	Wakefield of Kendal, L.
de Clifford, L.	Mersey, V.	Ward of North Tyneside, B.
Denham, L. [Teller.]	Middleton, L.	Ward of Witley, V.
Derwent, L.	Monck, V.	Young, B.
NOT-CONTENTS
Ampthill, L.	Bruce of Donington, L.	Clancarty, E.
Ardwick, L.	Buckinghamshire, E.	Collison, L.
Aylestone, L.	Burton of Coventry, B.	Cooper of Stockton Heath, L.
Boston of Faversham, L.	Caradon, L.	Crowther-Hunt, L.
Bowden, L.	Castle, L.	Davies of Penrhys, L.
Brimelow, L.	Champion, L.	Donaldson of Kingsbridge, L.
Douglas of Barloch, L.	Maybray-King, L.	Shepherd, L.
Douglass of Cleveland, L.	Murray of Gravesend, L.	Snow, L.
Gaitskell, B.	Pannell, L.	Stamp, L.
Gordon-Walker, L.	Pargiter, L.	Stedman, B. [Teller.]
Goronwy-Roberts, L.	Parry, L.	Stewart of Alvechurch, B.
Hale, L.	Peart, L. (L. Privy Seal)	Stow Hill, L.
Hankey, L.	Phillips, B.	Strabolgi, L.
Henderson, L.	Ponsonby of Shulbrede, L.	Taylor of Mansfield, L.
Ilchester, E.	Popplewell, L.	Wallace of Coslany, L.
Janner, L.	Ritchie-Calder, L.	Wells-Pestell, L. [Teller.]
Leatherland, L.	Roberthall, L.	Winterbottom, L.
Lee of Newton, L.	Sainsbury, L.	Wise, L.
Listowel, E.	Samuel, V.	Wynne-Jones, L.
Llewelyn-Davies of Hastoe, B.

Resolved in the affirmative, and Amendment agreed to accordingly.