The Coal Industry

HL Deb 19 February 1981 vol 417 cc786-92

3.59 p.m.

The Earl of Gowrie

My Lords, with the leave of the House, I should like to repeat a Statement which has been made in another place by my right honourable friend the Secretary of State for Energy on the coal industry. My right honourable friend's Statement was as follows:

"As the House knows, there was a tripartite meeting of the coal industry yesterday. This had been called, at the industry's request, to discuss the situation which had arisen following the meeting in London on 10th February between the National Coal Board and the unions. At that meeting the National Coal Board had outlined their approach to the current problems facing the industry. They had put forward a four-point plan for bringing the supply and demand for coal back into balance, whilst maintaining investment for the future. The plan included an accelerated programme for the closure of older capacity approaching the end of its productive life. This was to be discussed in detail in the areas. The board believed its plan to be reasonable and acceptable. However, fears and anxiety among the workforce arose through rumoured and distorted impressions of what was being proposed.

"It was against this background that yesterday's meeting took place. At the meeting, three main points were raised—closures, financial constraints and coal imports. I said that the Government were prepared to discuss the financial constraints with an open mind and also with a view to movement. The chairman of the National Coal Board said that in the light of this the board would withdraw their closure proposals and re-examine the position in consultation with the unions. I accordingly invited the industry to come forward with new proposals consistent with Plan for Coal.

"As regards imports, I pointed out that these would in any case fall this year from their 1980 levels. The industry representatives said they wished to see this figure brought down to its irreducible minimum. I said that the Government would be prepared to look, with a view to movement, at what could be done to go in this direction.

"I welcome the decision of the national executive committee of the National Union of Mineworkers today and hope that their lead will be followed. I will be meeting the industry again next Wednesday ". My Lords, that concludes the Statement.

Lord Peart

My Lords, may I thank the noble Earl, Lord Gowrie, for repeating that Statement. I believe that this is another U-turn. I am not going to try to make party political capital out of it because the situation is so serious that we need confidence restored in the industry. I think that Ministers and officials have handled the crisis with extraordinary clumsiness and insensitivity—and I really mean that. Here is a major industry which is so important to the economy of this country that every care should be taken in relation to not only negotiations but also attitudes outside. I think that the mining community sometimes feel that they are ignored and that certain Governments of a certain political flavour have a considerable prejudice over what happens in their industry. I hope that talks and discussions will now emerge. No doubt noble Lords will have read much of the press. I commend them to read the Financial Times carefully, because from that I understand that the Minister is arranging for a meeting with the energy and transport industries, the leaders of the NUM, the Iron and Steel Trades Confederation and the National Union of Railwaymen, next Thursday morning. I hope that these talks go well, but I hope that in no circumstances will the Government try to use the miners as a whipping boy.

Lord Tanlaw

My Lords, we, too, from these Benches wish to thank the noble Earl for his Statement and welcome the effects of it. We have no intention to point out the causes of it, but from these Benches we would like to put this question to the noble Earl. Can all the parties involved in the events which brought about this Statement learn some lessons—lessons of co-operation, fuller consultation and greater information? Anything that goes wrong with the coal industry affects the whole of British industry and is a very serious matter. I wonder whether the noble Earl can tell the House how much money, or extra money, will be involved in the effects of this Statement. Thirdly, will the noble Earl be able to reassure the domestic consumers of coal that, although there is to be negotiation about the importation of coal from abroad, this will not automatically create a price rise for the domestic coal consumer?

The Earl of Gowrie

My Lords, the noble Lord, Lord Tanlaw, said that anything that affects the coal industry affects industry as a whole. Of course, I agree with that. That is one of the reasons why inevitably the Government have become involved in matters which are preferably dealt with (as they traditionally have been dealt with) by the National Coal Board and the unions concerned. That is one of the reasons, again, why we welcome the lead that the national executive council of the National Union of Mineworkers has given today; and why my right honourable friend the Secretary of State will be calling a meeting again next Wednesday.

On the issue of U-turns—or tacks, whatever one cares to say—I think that this Government are identical with the previous Government in affirming their commitment to the future of the British coal industry. They have backed that commitment consistently throughout their period of office with hard cash in very large quantitites. But inevitably there can be misunderstandings or difficulties within an industry, and in an industry as important as this one the Government are happy to do all they can to sort them out.

Lord Shinwell

My Lords, may I ask the noble Earl whether he is aware that when this matter was raised last week I ventured to suggest that the Government must intervene? I am very relieved that they have done so, and I am quite sure that I represent the views of all sensible people in the United Kingdom in hoping that we are not going to have another industrial dispute—certainly the one which is likely if the miners decide to go on strike. With great respect to my noble friend the Leader of the Opposition, I do not think that anything is to be gained by indulging in suggestions about U-turns, or in sneering at the Prime Minister because she appears to have changed her course of action. The essential thing is that we are going to be relieved of another great industrial confrontation, and that is a great advantage.

All that I hope now is this. We should not worry too much about what appears to the Members on the Liberal Benches (though not to me) to be very important; namely, what it is going to cost. We might consider what it was likely to have cost if there had been a strike. That would be far more serious financially than having to ladle out more money now. No matter what it will cost—and it will always cost too much—to be relieved of another great industrial dispute in the circumstances facing this country is of great advantage to us all.

The Earl of Gowrie

My Lords, I am profoundly grateful for the remarks made by the noble Lord with all his experience of this particular industry and also for reminding the House—as I should have done, and I apologise to the noble Lord, Lord Tanlaw, on this—that questions of the issue of costs are not yet decided, and there is a long way to go. That is why the meeting has been convened again for next Wednesday.

Lord Holderness

My Lords, can my noble friend say, in cases where pit closures become necessary—and it seems to be agreed on all sides that there have been many such cases in the past and there will no doubt be a number in the future—what possibilities of employment exist in other pits in the country; and what assistance, financial or otherwise, might be available to miners who want to take advantage of such employment?

The Earl of Gowrie

My Lords, there is lateral movement (if I may put it that way) between exhausted pits and pits which have other capacities and aid exists for the expenses and the like where such lateral movements occasion them. Of course, I would remind my noble friend that one of the reasons why the Government have consistently committed very large sums of public money to the development of new capacity in the mining industry is that this industry has a great future—not only in the wealth and energy that it can generate for this country, but also in the employment it can bring.

Lord Cledwyn of Penrhos

My Lords, may I, too, welcome the Minister's Statement and express the fervent wish that there is a successful outcome to the negotiations. May I also express the hope that the South Wales miners will now return to work pending the conclusion of the negotiations.

Will the Minister bear in mind that in South Wales it is not a question of run-down pits; it is a question of pits producing the best coking coal in the world? The pits have now come to a difficult situation because of the run-down in the steel industry in South Wales. That has to be borne in mind. Will the Minister indicate what hopes there are of exporting this first-class coking coal if there is no immediate use for it in this country?

The Earl of Gowrie

My Lords, I welcome very much what the noble Lord has said and his call to the miners in the South Wales field, which I should like to endorse. Of course he is quite right in implying to the House that the coal industry, like other industries, has been affected in its revenue by falling sales both at home and abroad. That is one of the reasons why it is important to take another long, hard look at the position of the coal industry. He also reminded the House that the coal industry is a vigorous exporting industry as well. It would certainly wish, I imagine, to continue in that position; but of course world demand is down, not only home demand, and that is why we must use our best endeavours to get out of this recession so that normal life can be resumed as soon as possible.

Lord Davies of Leek

My Lords, may I thank the noble Earl for the Statement? There is not the slightest doubt that tribute should be paid to Mr. Joe Gormley who is a realist, has his feet on the ground and was able to see that this meeting took place. I was delighted with the expression at the end of the Minister's Statement that they welcomed the decision of the national executive of the NUM and I therefore wish to pay a tribute to the NUM. I know of the poverty and desolation of the 1931 period and before and what that led to. Without trying to score a political point, as the noble Earl said, these matters were to be discussed in detail in the areas, and the pity was that the discussion did not take place before the plan was "bumped" on to the public. This debate is far too important to want to try to score party points. What we want is Britain back at work.

The Earl of Gowrie

My Lords, I endorse what the noble Lord said about Mr. Joe Gormley. I would remind the House that Mr. Gormley has called for people now to return to work throughout the industry and we all welcome that. As my right honourable friend's Statement said, fears and anxiety among the workforce did arise—and, perhaps precipitately—but we must look at human and psychological considerations as well as economic ones and that is why I welcome the proposed additional meeting.

Lord Orr-Ewing

My Lords, from this side, could I also endorse the praise which is deserved by Mr. Joe Gormley who has behaved in a most statesmanlike way. I am sure that this should be universally recognised. It is in rather marked contrast to some of those who have been leading the South Wales problems. Could my noble friend say whether our exports—which are forecast to be 8 million tons of coal this year—will be in any way at risk as a result of our restriction of imports? This 8 millions is of importance not only for the cash flow to the NCB but because our stocks of 37 millions are so high that it is very difficult to accommodate another 8 millions if they are not sold abroad.

The Earl of Gowrie

My Lords, I do not think that it is a question of restriction of imports at this stage. Imports have been falling naturally through surplus capacity and through demand. Certainly world demand depends on whether the exports from the NCB can be kept up. My information is that they are going to be considerably higher this year than last. Given the state of the industrialised world, that is very good going indeed.

Lord Elwyn-Jones

My Lords, while I appreciate that there will be further negotiations, may I ask whether the noble Earl could throw a little more light on the sentence in the Statement that the Government are prepared to discuss the financial constraints with an open mind and with a view to movement? Does that mean that there will be relaxation on the restraints under the Coal Act and that there will be movement in that direction? Secondly, does the announcement that the Secretary of State for Employment has agreed to meet the mining and steel trade union leaders next week to discuss the contraction of those industries mean that that subject is now to be examined fundamentally? Would not an earlier examination have prevented the unhappy crisis which has arisen?

In regard to the crisis is the noble Earl aware—and I think he has indicated this—that the mining communities of South Wales, where I was brought up, in particular have long and bitter memories of governmental neglect and indifference? Will he, his colleagues and the officials concerned, bear in mind that it is a scene that needs to be treated with great sensitivity? That is the least we owe them.

The Earl of Gowrie

That is exactly what we think we are doing: we are treating this situation with great sensitivity. As I said, we have consistently—to use a vulgarism—put our money where our mouth is in respect of the coal industry. That is true of successive Governments. The meeting with my right honourable friend the Employment Secretary was arranged previous to this issue in the coal industry, and so that is part of our on-going discussions as to how to get the economy out of recession. Regarding what viewing financial constraints with an open mind and also with a view to movement means, an open mind means just that. The view to movement is that we recognise that the external financial limits of the coal industry were drawn up at a time when the expectations of revenue were very different in view of what has happened in terms of demand, recession and surplus capacity. That is why we are prepared for movement.

Lord Glenkinglas

My Lords, while agreeing with everything that my noble friend has said and much of what has been said on every side of the House, may I ask my noble friend this: Would he please consider what would be the most appropriate Oscar to give the National Coal Board for what must be the worst bit of public relations seen this century?

Lord Energlyn

My Lords, may I also extend to the Minister our thanks and express relief at the Statement he has made? May I also thank him for the clarity and sympathy in the answers that he has given to the many questions? One point that I should like to enlarge upon at some distant date is the characteristics of British coal. In Britain we have been endowed with every variety of coal known to man. We have lost our home-based markets to a substantial extent. I hope that this will have removed the blinkers away from the National Coal Board and we shall look upon our coal as an export.

The Earl of Gowrie

My Lords, I am grateful for the remarks of the noble Lord. We shall bear them closely in mind.

Lord Mishcon

My Lords, while all of us I think in this House this afternoon are endeavouring to exercise the utmost constraint—and very sensibly so in the present position—would the noble Earl not think it ungracious if hereafter, and possibly after peace has been declared in the coal industry, we revert to the question of whose clumsiness it was and whether it was only the National Coal Board or whether there was not clumsiness elsewhere?

The Earl of Gowrie

My Lords, I do not think that this is a question of clumsiness. Obviously, it is possible in any industry for the workforce to be anxious—often unreasonably—about something which is being suggested, and for that anxiety to get blown out of the proportion that it was originally intended to have. As the noble Lord, Lord Tanlaw, said, this industry is of very great importance to every part of the economy, and it is inevitable that the Government would be drawn in. The Government are now trying to see that a new mood prevails in the industry. Then the industry can get back together and work its own way without Government intervention, which is the best way.

The Lord President of the Council (Lord Soames)

My Lords, if I may intervene, I think we have had a good and on the whole useful exchange of questions and answers on this subject. In view of the fact that there is another meeting which has been announced to take place on Wednesday, I think the House will agree it is better to move on.