HL Deb 13 July 1983 vol 443 cc795-7

2.52 p.m.

The Earl of Lauderdale

My Lords, I beg leave to ask the Question standing in my name on the Order Paper.

The Question was as follows:

To ask Her Majesty's Government what action they propose to take on the Monopolies and Mergers Commission report on the National Coal Board.

The Parliamentary Under-Secretary of State, Department of Energy (The Earl of Avon)

My Lords, the commission have produced a thorough and valuable report. This highlights the board's two central problems, which are separate but closely related, of over-capacity and high-cost pits. A Statement will be made in due course on the action to follow the report.

The Earl of Lauderdale

My Lords, I thank my noble friend for that reply, which at least suggests that there will be a Statement at some time or another. Would he not agree that this report focuses on one important fact; namely, that some £300 million a year of the losses of the Coal Board seems to be attributable to only 30 pits out of 190? This is of course a strong argument for closure. Can my noble friend say whether the Government have in mind some policy of a general kind to assist the areas which have to face such closures mainly in Scotland and in Wales?

The Earl of Avon

My Lords, I agree with my noble friend. In fact, I think that the chairman has recently said that 10 million tonnes of capacity is responsible for a total loss of about £400 million a year, both in direct losses and in the cost of stocking surplus production. As far as the second question of my noble friend is concerned, there is always a wide range of measures to encourage the creation of new jobs in high unemployment areas, and obviously the Government will keep in mind the impact of coal redundancies on regional unemployment figures. For instance, the board have given an assurance that alternative jobs will be found for all those from Cardowan who wish to continue in the industry.

Viscount Massereene and Ferrard

My Lords, am I not right in saying that the Coal Board are very generous to miners who become redundant? At a small mine in Fife the other day I think they received £20,000 redundancy money each if they could not be found a new job, and they also received £100 a week until they got the old-age pension. I think I am right in saying that, because the Coal Board are very generous to the miners.

The Earl of Avon

My Lords, I note the comments of my noble friend.

Lord Boyd-Carpenter

My Lords, can my noble friend indicate whether his promised Statement will be made before the House rises for the Summer Recess? Is he aware that a good many people who are being taxed to the extent of some hundreds of millions of pounds to sustain in operation pits which will always be profitless are getting a bit impatient?

The Earl of Avon

My Lords, I note my noble friend's comment. I know it is hoped to be able to produce a Statement before the end of this Session.

Lord Ezra

My Lords, would the noble Earl agree that in any future strategy for the coal industry a high level of investment should be maintained in order to make the best and most efficient use of this valuable resource, and furthermore, to facilitate the progressive replacement of high-cost capacity?

The Earl of Avon

My Lords, the noble Lord will be well aware that at the moment investment stands at just over £800 million, and that our total cost for this particular year is £1.2 billion. I should like to reiterate that the Government are totally committed to the development of a modern and viable coal industry.

Lord Shinwell

My Lords, is the noble Earl aware that, if one of the main problems troubling the Monopolies Commission about the National Coal Board is the loss sustained annually by the board, apart from a bare number of privately-owned pits before nationalisation the coal industry has never, in a wholesale fashion, made a profit?

The Earl of Avon

My Lords, I am grateful to the noble Lord for his comments.

The Earl of Lauderdale

My Lords, would my noble friend take into consideration, before the Statement is made, that some £4 billion has been put into this industry, over the last 10 years, which is quite a lot of money; that much of the loss is focused on a relatively small number of pits; and that the closure of those pits therefore calls for greater mobility of labour and co-operation on the part of, among others, the unions concerned to support the movement of redundant men to more likely pits?

The Earl of Avon

Indeed, my Lords, I agree with my noble friend. We are of course anxious to support this industry in every way possible. It might interest the House to know that the best 20 pits have average costs of about £28 a tonne, which is very competitive, whereas the worst 20 pits have costs of £89 a tonne, which is more than double the average United Kingdom price.