Coal: Import Policy (Hansard, 4 April 1989)

§ The Parliamentary Under-Secretary of State, Department of Energy (Baroness Hooper)
My Lords, it has never been this Government's policy to restrict imports of coal. We believe that the purchase of coal, whether imported or indigenous, is a matter for the commercial judgment of individual customers.

§ Lord Dormand of Easington
My Lords, in view of the huge increase in the importing of coal and the usual difficulties associated with any imports, how much importance do the Government place upon the 200 years' coal reserves which we have in this 1007 country, at the present rate of extraction, to ensure supplies in the future? If, as the Minister seems to suggest, the Government are concerned, entirely or mainly, about price, what does she have to say about the fact that much of the imported coal comes from countries which have labour conditions, including the use of child labour, which would be intolerable in this country?

§ Baroness Hooper
My Lords, the Government are giving, and will continue to give, their steady support to British Coal's drive to restructure the industry and to make itself competitive internationally. The Government have faith in the industry's future, and that has been demonstrated by our financial support. However, while the Government maintain a large investment programme, in the longer term, once British Coal is financially stronger, it is our intention that the corporation should take full financial responsibility for all its new restructuring costs.

§ Lord Boyd-Carpenter
My Lords, is not the solution to be found in encouraging British Coal to become more competitive?

§ Baroness Hooper
My Lords, I hope that that is what I implied in my last reply. We see British Coal in future needing to produce secure supplies which are competitive on the world market.

§ Lord Ezra
My Lords, does the Minister agree that in respect of competitiveness British Coal's achievement over the past few years in producing an enormous increase in productivity has been something to be admired? Secondly, does she also accept that the import of coal is an uncertain thing, as the price of imported coal depends upon the level of freight rates at any one time, the level of sterling in relation to other currencies and the performance in the countries concerned; and that we should be well advised as a country to continue to depend as much as possible upon our indigenous and certain reserves?

§ Baroness Hooper
My Lords, very good progress is being made on improving productivity, which has gone up by 50 per cent. since the strike. But productivity in our main competitor countries, particularly Australia and the United States, is still over three times as high and is continuing to improve at a rapid rate. However, as I said in my original Answer, the conditions of purchase for consumers is a matter for their commercial judgment.

§ Lord Mason of Barnsley
My Lords, is the Minister aware that 12 million tonnes of coal annually are imported into this country from 12 different countries? No doubt some of that coal is subsidised. That has resulted in the loss of 6,000 British mineworkers' jobs. Why is it that the Government persist in a policy of importing unemployment, creating high unemployment and the misery that goes with it in the coalfield communities, in addition to ruining our own coal industry?

§ Baroness Hooper
My Lords, I cannot agree with the implication of the last supplementary question. We believe that the freedom to import coal, if consumers choose to do so, is essential and should be encouraged. Nevertheless, the restructuring of the British industry is making it viable and competitive. That is why the Government are continuing to encourage it.

§ Lord Williams of Elvel
My Lords, if the Government cannot agree with my noble friend Lord Mason, can they give a response to Sir Robert Haslam, who in a recent statement to the Coal Industry Society said that the consequence of post-privatisation generators relying on imported coal was that there would be a dramatic effect upon the United Kingdom's balance of payments and there would be yet another round of closures of UK collieries?

§ Baroness Hooper
My Lords, I am not aware that the results of privatisation will be to increase the imports of coal.

§ Lord Dean of Beswick
My Lords, can the Minister tell us what effect the importation of foreign coal has had on our awful balance of payments situation which exists at present?

§ Baroness Hooper
My Lords, without notice I cannot give a detailed reply on the effect on the balance of payments. All I can say is that there is a need to import a certain amount of coal for some purposes in any event—coking coal, for example, for use in the steel industry. Other imports that have been made are necessary to ensure a diversity of supply.

§ Lord Williams of Elvel
My Lords, the noble Baroness said in response to my question that privatisation might not have any effect on this. Is she not aware that the Electricity Bill gives the Secretary of State the power to control all fuel stocks? But the Government have stated that they have no intention of restricting cheap fuel imports and that the current joint understanding between British Coal and the electricity supply industry will be abandoned. Is that not tantamount to saying, as the noble Baroness herself has said, that the Government will encourage coal imports?

§ Baroness Hooper
My Lords, what I have said is that the CEGB and the SSEB are already free to import coal if they choose. This freedom of choice will be retained by private generators after the privatisation of the electricity industry.

§ Lord Hatch of Lusby
My Lords, can the noble Baroness tell the House what is the Government's policy towards the import of coal from South Africa in view of the fact that many members of the EC are at present discussing a policy of banning the import of coal from South Africa as part of their sanctions policy?

§ Baroness Hooper
My Lords, the Government have no plans to ban imports of coal from South 1009 Africa at present. That is in line with the decision reached by the European Community Foreign Ministers on 15th September 1986.

§ Lord Dormand of Easington
My Lords, in supporting the remarks made by the noble Lord, Lord Ezra, about the price of British coal, I wish to ask whether the Minister is aware that the cheapest deep mined coal comes from the North of England. In the last five years 3.5 million tonnes of coal have been imported, an increase of 2 million tonnes. If that continues, it will mean the closure of at least four pits in the northern region, with the devastation of mining communities which this Government know all about. Does that not mean anything to the Government?

§ Baroness Hooper
My Lords, I am well aware of the interest of the noble Lord, Lord Dormand, in coal mining in the North-East of England. All I can say is that the closure of pits results from the restructuring of the industry to make it more competitive. It has nothing to do with the imports of coal.

§ Lord Cledwyn of Penrhos
My Lords, the implications of all the noble Baroness's replies are that there is no future for the British coal industry. Is she aware that 20 years ago, when I was Secretary of State for Wales, there were 60,000 coalminers in Wales? Today the figure has been reduced from 7,000 to 5,000. Will the noble Baroness be good enough to say that she will talk to her right honourable friend and convey the exchanges in this House to him and ask whether he will take positive steps to preserve the British coal industry rather than close it down?

§ Baroness Hooper
My Lords, of course I shall draw my right honourable friend's attention to the exchange of remarks today. But I must emphasise that the Government have given, are giving and will continue to give steady support to British Coal's drive to restructure the industry.

§ Lord Campbell of Alloway
My Lords, perhaps I may ask my noble friend the Minister whether the import of coal is a question of price or want of capacity, or both.

§ Baroness Hooper
My Lords, it affects price and competitiveness.

§ Lord Leatherland
My Lords, may I ask the Minister whether we are now importing substantial quantities of gas? Is it not a fact that if that gas were distilled from British-mined coal it would give lots of men employment?

§ Baroness Hooper
My Lords, I believe that the noble Lord is referring to the process of the gasification of coal. R&D is being conducted into this area and we await the outcome with interest.

§ Lord Leatherland
Yes, my Lords, but that is not answering my question; is it?

Noble Lords
Answer!