Coal Industry Bill

HL Deb 21 June 1994 vol 556 cc204-62

4.45 p.m.

Baroness Trumpington

My Lords, I have it in command from Her Majesty the Queen and His Royal Highness the Prince of Wales to acquaint the House that they, having been informed of the purport of the Coal Industry Bill, have consented to place their prerogatives and interests, so far as they are affected by the Bill, at the disposal of Parliament for the purposes of the Bill.

Read a third time.

Clause 7 [Exploitation rights: general]:

Lord Morris of Castle Morris moved Amendment No. 1:

Page 7, line 6, leave out subsection (3) and insert:

("(3) On the restructuring date, all of the Corporation's interests—

1. (a)in unworked coal and coal mines, including its interests in any coal that, notwithstanding having been worked at some time, is so attached to or incorporated in any coal mine or other land as to be, in law, a part of it;
2. (b)in land which is owned by the Corporation and used for the purposes of coal-mining operations on the date of Royal Assent; and
3. (c)in land which is occupied on the date of Royal Assent for the purposes of coal-mining operations undertaken at any time but not owned by the Corporation;

shall, subject to such interests and rights as the Secretary of State may create in favour of others under section 12 below, vest without further assurance in the Authority.").

The noble Lord said: My Lords, throughout the debates in this House we have been told a number of things about the way in which British Coal's liabilities will be treated in the future. We have been told, on the one hand, at the last stage on 13th June, at col. 1481 of Hansard, that: any pollution or negligence created by British Coal will… vest in the Coal Authority"; and, on the other hand, that: the whole question of contamination is fraught with difficulty. That has nothing to do with the Bill".—[Official Report, 13/6/94; col. 1457.]

I do not believe that either statement is correct, but I do believe, and accept, that liabilities go with ownership. The new owners of the coal assets will be responsible for those problems that properly pass with the assets. The Bill ensures that coal and coal mines (which covers everything past, present and future underground) pass to the Coal Authority.

The Minister assured us at the previous stage that no liabilities will cause a problem after privatisation because the Coal Authority will, without fail, ensure that everything that needs to be done by the new companies is done because the authority will vet their suitability, financial strength and competence. I take some comfort and reassurance from that. The authority should get it right more often than not, but there will certainly be problems; hard cases make bad laws, and they will affect many third parties, the innocent bystanders.

So this amendment to Clause 7(3) gets to the heart of the matter. The clause is about transferring ownership and is the only definite provision for the transfer of assets "without further assurance" to the Coal Authority. In addition to the coal and coal mines, it transfers two further types of property associated with coal mining operations. In neither case does the transfer prevent the Secretary of State making other arrange-ments because the amendment provides for the authority to become the owner subject to the rights or interests that the Secretary of State may have created under a restructuring scheme. The amendment ensures that the following property is transferred to the authority to ensure that, through ownership, it has responsibility for the liabilities. The first category comprises those properties which are currently used for coal mining operations. The second category covers those lands associated with coal mining operations where British Coal does not own the land, but rents it. There is a clear need to ensure that all the obligations to the owner should be fulfilled as fully as possible. The accumulated pollution and contamination is likely to be considerable.

The amendment merely seeks to ensure that the Government, the authority and British Coal take the proper and responsible approach to such property to ensure that no innocent party suffers loss. I beg to move.

Lord Mason of Barnsley

My Lords, I rise to seek clarification. The Minister will remember that the amendments tabled last week by my noble friend Lord Morris, which were defeated by four votes, sought to clarify the position on environmental liability for discharges of minewater from abandoned mines. The amendment to Clause 7, for example, made it clear that actual and potential civil liabilities would be transferred from British Coal to the authority. The Minister suggested that the amendment was not necessary because these liabilities would pass automatically.

Advice taken by the Anglers Co-operative Association and others suggest that that may not be the case. The Bill operated to vest land and assets in the Coal Authority. Under normal law, a transfer of land operates to vest benefits and burdens attaching to that land. It does not automatically vest civil liabilities. It is clear that the Government intended that pre-existing civil liabilities ought to vest in the Coal Authority.

It is a possibility that civil liabilities may disappear if the Bill is passed in its present form. Therefore, does the Minister agree that, for the avoidance of doubt, any civil liabilities, whether actual or potential, existing on the restructuring date shall be transferred to the Coal Authority on that date?

Lord Renton

My Lords, subject to what my noble friend may say, I believe that the amendment deserves careful attention. At various stages in our proceedings my noble friend Lord Strathclyde has emphasised the importance of Clause 7(3), and rightly so. Perhaps I may say in passing that the side note, "Exploitation rights: general", does not summarise or express the full effect of Clause 7.

The main point is that Amendment No. 1 does not alter the purpose of subsection (3) or the principle underlying it; it merely clarifies its application, especially paragraphs (b) and (c). Paragraph (b) makes it clear that the provision applies to: land which is owned by the Corporation and used for the purposes of coal-mining operations on the date of Royal Assent". Paragraph (c) makes it clear that it applies to: land which is occupied on the date of Royal Assent for the purposes of coal-mining operations undertaken at any time but not owned by the Corporation That kind of clarity can be regarded only as helpful.

Lord Gray of Contin

My Lords, on this occasion I cannot quite agree with my noble friend. British Coal has a wide range of responsibilities and many are subject to different statutory frameworks. Each type must be considered individually and on its merits. The Coal Authority will become owner of the freehold of underground mines, regardless of their date or whether they have been abandoned. Under Clause 7(3), the Coal Authority automatically acquires responsibilities which go with the ownership.

My noble friend pointed out that on previous occasions the Minister had highlighted the importance of Clause 7(3). This amendment actually deletes Clause 7(3) and replaces it with a subsection which has three further sub-divisions. They deal with unworked mines, land which is owned on the date of Royal Assent, and land which is occupied but not owned by the corporation—

Lord Renton

My Lords, I believe that my noble friend has misunderstood the position. The amendment does not delete subsection (3). It replaces it and repeats it, but amplifies it.

Lord Gray of Contin

My Lords, I believe that we are into the semantics—

Lord Renton

My Lords, no, it is fundamental.

Lord Gray of Contin

My Lords, the amendment begins: Page 7, line 6, leave out subsection (3) and insert". It then describes what is replacing subsection (3).

In any event, under subsection (3) the Coal Authority becomes the freehold owner of all British Coal's underground mines, including abandoned mines, regardless of age.

Lord Northbourne

My Lords, will the noble Lord accept that the provision does not apply necessarily to surface land occupied with mines or abandoned mines?

Lord Gray of Contin

My Lords, not necessarily. The effect is to preserve the status quo; in other words, mines continue to belong to a public-sector body. Presumably, that is basically what the noble Lord, Lord Morris of Castle Morris, wants. I cannot see that by deleting Clause 7(3) and replacing it with the words on the Marshalled List the noble Lord is improving the situation at all. I believe that the Bill is adequate in its present form.

5 p.m.

Lord Strathclyde

My Lords, I am grateful to have the opportunity to speak so early in the debate. I am surprised because I had thought that we should hear more words on a subject which is clearly of great importance. My noble friend Lord Renton was absolutely right in saying that it is important that the House understands what we are dealing with. For that reason, I am grateful in particular to my noble friend Lord Gray. Much as it is useful to look again at these matters, I am not at all convinced that the noble Lord, Lord Morris of Castle Morris, has clarified the situation. If his desired effects are as he described in his relatively short remarks, I am afraid that this amendment will not achieve them.

This is the third occasion on which we have dealt with the issue. It is complex for a variety of reasons, and it may be helpful if I describe how land will be dealt with under the Bill. I shall also deal with the points raised by the noble Lord, Lord Mason, and my noble friend Lord Renton.

First, Clauses 7(3) and 8(2) provide for British Coal's interests in unworked coal and coal mines to be vested in the Coal Authority. That reflects general agreement that the freehold interest in the coal should basically remain in the public sector. However, as I said previously, I see no reason to seek to retain in the public sector the generality of the freehold of other land—that is, surface land—which is or which has been associated with coal mining.

This land falls into a number of categories, each of which will need to be dealt with separately. That is why we envisage handling transfers through restructuring schemes. Perhaps I may begin with land associated with current coal mining operations. I see no reason why mine operators should not own the freehold of the surface land and, in due course, dispose of it as they judge best. The noble Lord, Lord Morris of Castle Morris, made no case against that.

If that is so, there is no merit in transferring the title from British Coal to the Coal Authority, the authority then leasing that land back to British Coal for the period that it continues to operate the mine, and then transferring the lease and the freehold interests to the successor operators at the time of sale. It is better to leave the title with British Coal and then transfer it directly to the successor operators. Much of the land associated with past coal mining is unlikely to be of use for future coal mining. If that is passed to the Coal Authority, it would then be under a duty to dispose of it. Again, it may be possible to short circuit that process by direct sale from British Coal. If so, that would clearly be preferable. Alternatively, it might be appropriate to transfer some of that land to development agencies or local authorities. Indeed, the right reverend Prelate referred to that in our discussions in Committee and on Report. There are therefore a number of possible destinations for that category of land.

Finally, we have land that has been used for past coal mining that may be useful for future coal mining. Our expectation is that that land will generally be transferred to the Coal Authority, along with a category of land not covered by the amendment—land that has not been used in the past for coal mining but may be useful in the future for that purpose.

I said that we have a complex situation, with a number of options; and we do. That is why it is appropriate to deal with it, as the Bill envisages, as was interpreted by my noble friend Lord Gray, through the flexible instrument of restructuring schemes under Clause 12. I do, however, recognise that there is general anxiety about the passing to the authority of liabilities related to past coal mining.

Perhaps I may deal with the point raised by the noble Lord, Lord Mason of Barnsley. Civil liabilities of the corporation will stay with the corporation on the restructuring date. When the corporation is ultimately wound up, those liabilities will be transferred elsewhere in the public sector before British Coal is dissolved. British Coal cannot be left with liabilities when it is wound up. We must find a home for those liabilities and we shall do so under the restructuring scheme.

By becoming the freehold owner of coal and coal mines, the authority will automatically acquire the responsibilities, including environmental liabilities, running with that ownership, which it will pass on to mine operators under the terms of the lease in respect of areas which it licenses for coal mining.

I turn now to the matter of third parties. The noble Lord, Lord Morris of Castle Morris, argued that this amendment is necessary to secure the protection of third parties when the land owned by British Coal is privatised—in other words, the surface land, because we have dealt successfully with the underground land.

I said earlier that the amendment would not work in practice and it would not. The Government have decided to vest British Coal's interests in unworked coal and coal mines in the Coal Authority because, as a general rule, we intend the authority to retain that property and discharge those responsibilities falling on it as the owner of that property.

The same consideration does not apply to other land in which British Coal currently has an interest, as I explained earlier. I cannot see what extra protection it would give to third parties to transfer all of British Coal's land to the authority prior to sale.

The Government are taking adequate measures to protect the interests of third parties in the sale of British Coal's land. The measures that we are taking will depend on the use to which the land will be put. Some land will be required for operational purposes of the successor companies or by a future licensee of the Coal Authority. Those operators will be obliged to undergo the licensing process. The noble Lord, Lord Morris, mentioned that and said that that was not sufficient. But that is a statutory obligation provided under Clause 2 of the Bill.

I turn now to non-operational land. I am aware of the particular anxieties that have been expressed about land in which British Coal currently holds a leasehold interest. Where land is not required by one of the five regional coal mining businesses, it is likely that it will be sold in the normal way. In those cases, assuming that British Coal is the original lessee, the freeholder will retain all of his rights of recourse against British Coal or its successor bodies under the principle of privity of contract, as well as any rights against the new lessee that appear in the lease.

There may be cases in which British Coal's leasehold interest in land is transferred, other than to a successor company, by means of a restructuring scheme. I can assure your Lordships that, in those cases, the Secretary of State would be bound to exercise his scheme-making powers reasonably, or else face judicial review. We should not under-estimate the powers of judicial review. The Secretary of State could not possibly consider a transfer to a body which he considered was not likely to be able to discharge his obligations.

I apologise for making a rather longer speech than was made by the noble Lord who proposed the amendment. However, I hope that I have dealt with the situation as fully as possible, and I certainly hope that I have convinced the noble Lord, Lord Morris.

Lord Morris of Castle Morris

My Lords, I took some comfort from the helpful remarks of the noble Lord, Lord Renton. He put matters so clearly that I felt that I had at last and for once managed to make myself clear. Alas, I had not so persuaded the noble Lord, Lord Gray, but for four minutes that became a private battle into which I felt that I could not intervene with profit.

Then came the Minister and I regained my poise and confidence quite quickly. As I listened to him it became as clear as crystal that we shall simply not agree on this matter. We are calling to each other across a bottomless abyss; we shall never bridge it. It became crystal clear to me when he dealt with the matter of judicial review because judicial review is so far removed from the face of this Bill. I wish to see assurances built into law. I am totally confident that I am right. I have no alternative but to ask the House to express an opinion which I hope will agree with mine.

5.6 p.m.

On Question, Whether the said amendment (No. 1) shall be agreed to?

Their Lordships divided: Contents, 117; Not-Contents, 135.

Division No. 2
CONTENTS
Addington, L.	Lester of Herne Hill, L.
Airedale, L.	Lindsay, E.
Archer of Sandwell, L.	Liverpool, E.
Attlee, E.	Lockwood, B.
Barnard, L.	Longford, E.
Barnett, L.	Lovell-Davis, L.
Bathurst, E.	Lytton, E.
Bonham-Carter, L.	Mackie of Benshie, L.
Boston of Faversham, L.	Mallalieu, B.
Bottomley, L.	Mason of Barnsley, L.
Brooks of Tremorfa, L.	Mayhew, L.
Bruce of Donington, L.	McIntosh of Haringey, L.
Bumham, L.	McNair, L.
Burton, L.	Merlyn-Rees, L.
Buxton of Alsa, L.	Middleton, L.
Callaghan of Cardiff, L.	Monk Bretton, L.
Carmichael of Kelvingrove, L.	Monkswell, L.
Carter, L.	Monson, L.
Castle of Blackburn, B.	Montagu of Beaulieu, L.
Chapple, L.	Morris of Castle Morris, L.
Cledwyn of Penrhos, L.	Mountgarret, V.
Clinton-Davis, L.	Mowbray and Stourton, L.
Cornwallis, L.	Norfolk, D.
Craigavon, V.	Northbourne, L.
Dainton, L.	Palmer, L.
David, B.	Parry, L.
Desai, L.	Peel, E.
Donaldson of Kingsbridge, L.	Perry of Walton, L.
Donoughue, L.	Peston, L.
Dormand of Easington, L.	Pitt of Hampstead, L.
Ennals, L.	Rankeillour, L.
Ewing of Kirkford, L.	Redesdale, L.
Ezra, L.	Richard, L.
Falkender, B.	Ridley, V.
Fisher of Rednal, B.	Rochester, L.
Foot, L.	Rodgers of Quarry Bank, L.
Forester, L.	Savile, L.
Gallacher, L.	Scanlon, L.
Geraint, L.	Seear, B.
Gladwyn, L.	Sefton of Garston, L.
Glenamara, L.	Serota, B.
Graham of Edmonton, L.	Shepherd, L. [Teller.]
	Stafford, L.
Grey, E.	Stanley of Alderley, L.
Hamilton of Dalzell, L.	Stoddart of Swindon, L.
Harris of Greenwich, L.	Strabolgi, L.
Harrowby, E.	Strathcarron, L.
Haskel, L.[Teller. ]	Taylor of Blackburn, L.
Hilton of Eggardon, B.	Teviot, L.
Hollick, L.	Tordoff, L.
Hollis of Heigham, B.	Wallace of Coslany, L.
Howell, L.	Wharton, B.
Hughes, L.	White, B.
Jay, L.	Wigoder, L.
Jeger, B.	Williams of Crosby, B.
Jenkins of Putney, L.	Williams of Mostyn, L.
Kennet, L.	Willoughby de Broke, L.
Kilbracken, L.	Winchilsea and Nottingham, E.
Kirkhill, L.	Wynford, L.
NOT-CONTENTS
Aberdare, L.	Balfour, E.
Addison, V.	Barber of Tewkesbury, L.
Aldington, L.	Barber, L.
Alexander of Tunis, E.	Belhaven and Stenton, L.
Allenby of Megiddo, V.	Beloff, L.
Annaly, L.	Bird wood, L.
Archer of Weston-Super-Mare, L.	Blatch, B.
Arran, E.	Blyth, L.
Astor of Hever, L.	Boardman, L.
Astor, V.	Boyd-Carpenter, L.

Brabazon of Tara, L.	Long, V.
Bridgeman, V.	Lucas of Chilworth, L.
Brookeborough, V.	Lyell, L.
Brougham and Vaux, L.	Mackay of Ardbrecknish, L.
Butterworth, L.	Mackay of Clashfern, L. [Lord Chancellor.]
Cadman, L.
Caldecote, V.	Macleod of Borve, B.
Campbell of Alloway, L.	Marlesford, L.
Campbell of Croy, L.	Merrivale, L.
Carnock, L.	Mersey, V.
Charteris of Amisfield, L.	Milverton, L.
Chesham, L.	Mottistone, L.
Clark of Kempston, L.	Mountevans, L.
Courtown, E.	Moyne, L.
Craigmyle, L.	Munster, E.
Cranborne, V.	Murton of Lindisfarne, L.
Cumberlege, B.	Nelson of Stafford, L.
Davidson, V.	Norrie, L.
Dean of Harptree, L.	Northesk, E.
Demon of Wakefield, B.	Orkney, E.
Dixon-Smith, L.	Oxfuird, V.
Dundonald, E.	Park of Monmouth, B.
Eccles of Moulton, B.	Peyton of Yeovil, L.
Eden of Winton, L.	Pike, B.
Ellenborough, L.	Quinton, L.
Elles, B.	Rees, L.
Elliott of Morpeth, L.	Renfrew of Kaimsthom, L.
Elton, L.	Renwick, L.
Faithfull, B.	Rodger of Earlsferry, L.
Ferrers, E.	Sanderson of Bowden, L.
Fraser of Carmyllie, L.	Seccombe, B.
Fraser of Kilmorack, L.	Selborne, E.
Gisborough, L.	Shannon, E.
Goschen, V.	Sharples, B.
Gowrie, E.	Simon of Glaisdale, L.
Gray of Contin, L.	Skelmersdale, L.
Gray, L.	Skidelsky, L.
Hailsham of Saint Marylebone, L.	Soulsby of Swaffham Prior, L.
Hanworth, V.	St. Davids, V.
Harmar-Nicholls, L.	Strange, B.
Harmsworth, L.	Strathclyde, L.
Harvington, L.	Strathcona and Mount Royal, L.
Haslam, L.	Strathmore and Kinghorne, E.
Hayhoe, L.	[Teller]
Henley, L.	Sudeley, L.
Hesketh, L.	Swansea, L.
Holdemess, L.	Thomas of Gwydir, L.
HolmPatrick, L.	Trefgame, L.
Hood, V.	Trumpington, B.
Hooper, B.	Ullswater, V. [Teller.]
Howe, E.	Vaux of Harrowden, L.
Hylton-Foster, B.	Vivian, L.
Ironside, L.	Wade of Chorlton, L.
Johnston of Rockport, L.	Wakeham, L. [Lord Privy Seal.]
Kimball, L.	Wedgwood, L.
Kitchener, E.	Whitelaw, V.
Knutsford, V.	Wise, L.
Laing of Dunphail, L.	Young, B.
Lindsey and Abingdon, E.

Resolved in the negative, and amendment disagreed to accordingly.

5.15 p.m.

Lord Peston moved Amendment No. 2:

Page 7, line 10, at end insert: ("(3A) On the restructuring date the Corporation's interest in geological data shall vest without further assurance in the Authority.").

The noble Lord said: My Lords, in moving the above amendment I shall speak also to Amendment No. 11. For the record, I should like to point out that the geological data mentioned in the amendment are of enormous importance. My understanding of the Bill is that it is fully protected by the legislation but for all sorts of reasons—not least Pepper v. Hart—I should simply like the Government Front Bench to confirm that such immensely valuable data will not be lost when the Bill becomes enacted. I beg to move.

Viscount Goschen

My Lords, the purpose of the amendment, as the noble Lord, Lord Peston, said, is to vest in the Coal Authority on the restructuring date British Coal's interests in geological data. I am happy to have the opportunity to assure the House that the Government have every intention that geological records in British Coal's ownership should be transferred to the authority. The Revised Coal Authority Explanatory Note, which has been placed in the Library, makes clear that it is envisaged that a great deal of information, notably geological data about coal and mining plans, will be transferred to the authority.

However, the amendments are not necessary to achieve that aim as geological and other information will be transferred to the authority by restructuring schemes under Clause 12 of the Bill. Indeed, to vest that information in the Coal Authority in the way proposed in the amendments would be positively undesirable, as it would prevent relevant parts of the information being shared with the successor companies to British Coal. The successor companies will need the geological information relating to their ongoing operational sites in order to carry on those operations after the restructuring date.

The authority has a duty under Clause 57 broadly to provide public access to the information in its possession which is not commercially confidential. That duty applies to geological data by virtue of Clause 57(1) (a). We would not have included that provision if we had not intended the Coal Authority to take over British Coal's geological data. As the Revised Coal Authority Explanatory Note again states, it is envisaged that the authority will, broadly, place geological data in the public domain but that it will not disclose new exploration data for a period sufficient to enable the person undertaking the exploration to benefit from his expenditure. I am sure that the noble Lord will agree that that is a significant improvement on the existing arrangements for public access to information. With those assurances and the detail that I have given, I hope the noble Lord will feel able to withdraw the amendment.

Lord Peston

My Lords, I thank the Minister for his reply. He has given me precisely the explanation and the assurances that I was seeking. It is excellent to have that statement on the record. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 12 [Restructuring schemes in relation to property etc. ]:

Lord Northbourne moved Amendment No. 3:

Page 12, line 46, leave out from first ("that") to end of line 47 and insert:

1. ("(i) that person consented to the provisions of the Scheme so far as they relate to him;
2. (ii) no persons to whom obligations are owed, whether in respect of contamination or other liabilities arising out of the occupation of any property used in connection with coal-mining 213 operations by the Corporation or its predecessors, is likely to sustain loss as a consequence of the Scheme.").

The noble Lord said: My Lords, the above amendment, as was the case with my amendments on Report, is concerned with the liabilities of British Coal. I believe that the Minister has accepted that we are all concerned about such liabilities, including liabilities which may arise in the future but which are unforeseeable at the moment and which arise out of acts or omissions of British Coal in the past during the course of its operations.

I am concerned about contamination and especially about contamination of surface sites. There are many types of surface site which are not specifically covered by Clause 7(3) of the Bill. When he was discussing Amendment No. 1, the Minister said that such sites might well be passed directly to operators. Where those sites are held leasehold and the lease is passed directly to operators, there is no provision in the Bill which requires that the freehold owner of the site should be consulted on whether the transferee is offering a strong enough covenant to be able to perform his obligations under the lease. That is one particular category of risk to which an innocent third party might be subject.

My real anxiety is what happens when British Coal has been dissolved. Liabilities under this kind of claim can be very large. The European Community in Brussels is at present considering the whole subject of contamination. Doubtless it will go on being a busybody in this area and will go on inventing new sorts of contamination which it claims are damaging, and the requirement will be that someone has to clear up the site. The cost of clearing up an old colliery site can be £2 million, £3 million or £4 million. That is a lot of money for a landowner, and if the contamination spreads on to neighbouring sites, that can also constitute a lot of money for the owners of the neighbouring sites.

I thank the Minister for a letter which he wrote to me on these issues in which he gave me certain assurances. But I have to say that I do not think the assurances adequately cover the problems to which I am referring. I have two amendments and I shall speak to the other one separately but this particular amendment relates to schemes in relation to property made by the Secretary of State under Clause 12 of the Bill. All this amendment does is to confirm that the Secretary of State must satisfy himself that the proposed scheme will not leave any third party to whom obligations are presently owed, or to whom potential obligations are owed by British Coal, less well off than that person would have been before the scheme. That is a wholly reasonable suggestion. It coincides exactly with what the Minister has said he wants to happen. Therefore if he means what he says, he surely must be prepared to allow this amendment to appear on the face of the Bill for the purpose of clarification.

This is an important amendment because uncertainty is damaging both for British Coal and for the beneficiaries of any liabilities which may exist. If British Coal wishes to dispose of the interest, it will receive worse offers than would otherwise be the case if it is not clearly known who is to accept future liabilities. The owner of the site may well be unable to dispose of the site at a reasonable price because the site will be blighted by the uncertainty that the Secretary of Stale may create a scheme which will leave the liabilities unprovided for. I beg to move.

Lord Renton

My Lords, I think the noble Lord, Lord Northbourne, has done a useful service in moving this amendment. The trouble is —I think everyone who is familiar with coal mines is conscious of this—that the physical and environmental problems to which coal mining gives rise, can continue for many years. There are of course various causes of those problems but they arise especially with regard to slag heaps. One must mention in passing that slag heaps sometimes are created well away from the top of the mine. Problems also arise with regard to underground water supplies, and that is a continuing problem which can affect not only the particular mine in which the contamination first arises, but because of the fluidity of the water table it can affect a much wider area, and frequently does so.

Of course one assumes and hopes and believes that a Secretary of State, in using his powers under Clause 12, will be wise and well advised, and will bear all those sorts of factors in mind, but it is just as well that we should apply our minds to them, and make sure that any Secretary of State in the years to come also does so, by doing what the noble Lord, Lord Northbourne, has suggested; namely, to remove uncertainty by putting into Clause 12 the provisions that he has suggested. I think, if I may say so, that the second sub-paragraph in his amendment that he suggests should be added, referring to "contamination or other liabilities", is of particular importance. I do not think we should leave an important thing like this to chance. Subject to what my noble friend has to say, I really think it would be best to have something on the lines of the amendment of the noble Lord, Lord Northbourne. As it is so late in the consideration of the Bill by both Houses, this is the last opportunity that we have of making such an amendment. So it is really the amendment of the noble Lord, Lord Northbourne, or nothing now.

Lord Gray of Contin

My Lords, I am not going to disagree with my noble friend on this occasion. I merely wish to make some comments on the proposed amendment. To me it seems that the amendment is not by any means clear and I feel that if we were to accept it in its present form it would open up scope possibly for judicial review at some future time, and would raise uncertainty perhaps about the effectiveness of restructuring schemes. This will deter potential purchasers who need certainty about the businesses they are taking on board. Indeed, it could put the success of coal privatisation at risk.

It is of the essence of privatisation that obligations of the public sector must be transferred to the private sector. The scheme-making powers in the Bill are well precedented and follow those in previous privatisations. The issue is that those powers should be used with responsibility. There are already extensive safeguards in Clause 2 of the Bill to ensure that mining companies are able to meet their liabilities. Where Clause 2 does not apply, it must nonetheless be the case that the Secretary of State would take account of the financial strength of a transferee when making a restructuring scheme. As so often happens at the Committee stage of a Bill, the intention of those tabling amendments or moving amendments is of the highest order, but at this stage of the Bill is it wise to accept an amendment which, as my noble friend pointed out, perhaps does not do everything that it was intended to do, and would it not be better to leave the Bill as it is? I think it is a mistake to accept an amendment, however good the intention behind it, if the wording is suspect.

Lord Sanderson of Bowden

My Lords, I must say that I agree with my noble friend Lord Gray on this. First of all, I accept that trying to remove uncertainties from this Bill at this stage is the correct approach; but having had a little bit to do with the industry—I do not have to declare an interest for the third time but I shall do so—I have looked closely at Clause 2 and I should have thought that mining companies are put on notice to meet their liabilities—and then there is a further safeguard. As my noble friend Lord Gray has said, surely the Secretary of State will take into account the financial strength of a transferee when making a restructuring scheme. I should have thought that was fundamental to the whole process.

Lord Peyton of Yeovil

My Lords, I should like to raise one small point in the amendment which seems to me to be a source of difficulty. We shall end up with a provision that under a restructuring scheme no person shall be: likely to sustain loss as a consequence of the Scheme". That is extremely vague. If there is any prospect that somebody may be left worse off the scheme is halted. That would seem to me to give rise to an objection, but I would only disagree with the noble Lord, Lord Northbourne, after careful consideration, and with some doubt.

Lord Northbourne

My Lords, perhaps I may draw the noble Lord's attention to the text of the amendment in the context of the Bill, which states: unless it appears to the Secretary of State that".

5.30 p.m.

Lord Morris of Castle Morris

My Lords, this is a most welcome amendment, which we are happy to support in view of the attitude taken over Clause 7(3).

The Minister wrote to me—I think that it was on 27th May but I would not wish to go to the stake on that —to assure me that the purpose of subsection (1) of this clause is to enable the Secretary of State to license and to grant leases to British Coal to keep it going on and after the restructuring date. The purpose of subsection (2) is to allow him to dispose of assets other than coal and coal mines. I understand and accept both points. But when I tabled Amendments Nos. 19 and 20 on Report the Minister dismissed me briskly, saying that the effect would be to prevent the privatisation of British Coal. I was not surprised by that answer, but I was mildly disappointed that the Minister had such a short memory of the letter he had written.

The present amendment of the noble Lord, Lord Northbourne, imposes a duty on the Secretary of State, in doing whatever he plans to do in restructuring the industry, to protect all these people in whom I have become extremely interested—the innocent bystanders —from any loss arising out of the inherited liabilities of British Coal. That must be right.

When Lord Baden-Powell created the Boy Scout movement, he also set up, for those too young to be Boy Scouts, the Wolf Cubs. The great cry of the Wolf Cubs to their Akela was, "Akela, we'll do our best!". So also must that great Wolf Cub, the Secretary of State, do his best. The amendment reminds him, necessarily, that he must try to get it right. I support the amendment.

The Earl of Harrowby

My Lords, before the Minister speaks I should like to assure the noble Lord, Lord Northbourne, that there is more than one advocate for his amendment on this side of the House. All the advice that I have received is that it is essential that the amendment is passed. It may not be perfect, but it is certainly an improvement on the existing situation.

LordStrathclyde

My Lords, I join my noble friend Lord Renton yet again in welcoming the opportunity to debate the amendment. I agree that the noble Lord, Lord Northbourne, has provided a useful service in bringing it forward.

But that is the only point on which I shall agree with my noble friend Lord Renton, because there are other aspects of what he said with which I have some difficulties, particularly the question of certainty. I agree entirely that the Bill that we send for Royal Assent should have certainty at its core. I believe that the Bill provides that in its entirety.

The main purpose of the Bill is privatisation. The essence of privatisation is to pass the assets and liabilities from the public sector to the private sector. That is what privatisation is all about. But that is not what the amendment provides for. It provides for the retention of the liabilities within the public sector. That in itself could be very damaging.

It may be helpful if I explain how we envisage that the restructuring scheme powers in the Bill will be used and the safeguards which will apply so that we do not leave matters to chance, or at least no greater chance than is applicable in the generality of commercial law.

These scheme-making powers are well precedented and follow those in previous privatisations. It is of the essence in any privatisation that obligations of the public sector must transfer to the private sector. The ownership of unworked coal and coal mines will transfer automatically to the Coal Authority under Clause 7(3) of the Bill. Following that transfer, the Coal Authority will have to comply with any obligations falling on it as owner of the coal.

On the restructuring date there will also be a restructuring scheme transferring to the Coal Authority that part of British Coal's property, rights and liabilities which the Coal Authority will need to carry out its functions. That will include any interests which British Coal has in property at mines which are operated by the private sector under licences granted by British Coal under Section 36 of the Coal Industry Nationalisation Act.

At privatisation, there will be a further restructuring scheme vesting in the new regional coal companies the property, rights and liabilities which are associated with the continuing mining business. It is intended that all British Coal's rights and liabilities under legal agreements which transfer will generally transfer to the new owners. Those who have legal agreements with British Coal will, therefore, have exactly the same rights against the new owners as they have at present against British Coal.

The assets transferred to the new coal companies will include the operating licences which will have been granted to British Coal on the restructuring date to enable the corporation to carry on its mining business. The Secretary of State, who will both make the restructuring scheme and be the vendor, will when granting the licences be bound to act in accordance with the duties set out in Clause 2 of the Bill. Those were explained by my noble friends Lord Sanderson and Lord Gray. The Secretary of State will also be obliged to take those duties into account when transferring the licences under the restructuring scheme.

In addition to its mining business, British Coal has a portfolio of property which is not required for present or future mining. The future of those assets is a matter for British Coal.

Consideration is still being given to how best to transfer British Coal's non-mining property holdings to the private sector. However, as I have already explained, the property which is not required by the regional companies or the Coal Authority will be sold in the usual way. In that event, privity of contract between the freeholder and British Coal would continue on the disposal of the lease.

Baroness White

My Lords, I am sorry to interrupt the Minister, but I am a little confused as to what happens to the opencast sites. He talks all the time about mining. Will opencast properties be treated separately?

Lord Strathclyde

My Lords, all sites will be transferred in one form or another under the Bill in the case of the deep coal mines either directly to the successor companies or to the existing freehold sites, which will also be passed on with their liabilities intact. The Secretary of State's duties do not differentiate between deep coal-mining, opencast or any other mining. The freeholders' position will therefore be fully protected.

The difficulty that I have with the amendment is that it is very wide and would apply to all restructuring schemes, including those in relation to which the Clause 2 duties would in any event have to be taken into account. It would apply to any liabilities arising from current or future use of land for mining, even where that land is owned freehold by British Coal. Since it does not lay down a clear standard against which compliance could in each particular case be measured, it would be very difficult to establish clearly whether the test laid down by the amendment had been met, so leading to great uncertainty for all concerned. It was my noble friend Lord Renton who raised the question of certainty. The amendment would create uncertainty. As my noble friend Lord Gray mentioned, there would also be greater scope for judicial review. The noble Lord, Lord Morris of Castle Morris, said that he was against judicial review in its wide application. It would throw restructuring schemes into doubt and make privatisation very difficult to achieve.

I did not mean to get at my noble friend. He and I have had some useful and helpful discussions on the matter. I hope that I have been helpful in clarifying the position. My noble friend Lord Renton said that we must not leave the matter to chance and that this is the last opportunity to amend the Bill. It is the last opportunity. We are at the last stage of a very comprehensive parliamentary procedure not just in this House but in another place.

I can offer the noble Lord, Lord Northbourne, reassurance that the interests of third parties will be protected. The Secretary of State himself is liable to judicial review if he exercises the restructuring powers under the Bill inappropriately. Before making a scheme he will clearly have to consider the financial circumstances of the transferee. We could not possibly consider making transfers to bodies that we considered were not likely to be able to meet their obligations. I believe therefore that the amendment is unnecessary for the purpose which the noble Lord intended and could cause considerable difficulties which I am sure the noble Lord did not intend. On that basis, I hope that he will withdraw his amendment.

The Earl of Lytton

My Lords, before the noble Lord sits down, perhaps I may ask him for clarification on a point which worries me. The matter of judicial review to which he referred has been referred to previously. I should be worried about that procedure for private individuals. It is an expensive procedure for individuals to undertake. The last time that I had any involvement in such a review it cost the individual about £15,000. That is a considerable impediment to procuring justice. With regard to the defence, "Well, we adhered to the best practice available at the time", will the Minister confirm that there are no circumstances under which the residual liabilities which cannot be attached to the operator or to any other official body can attach to an innocent landowner or householder or someone else in that category? I shall be grateful if the Minister can give me that confirmation.

Lord Strathclyde

My Lords, perhaps I may speak with the leave of the House, first, on the question of judicial review. It is not my intention that judicial review should ever be used as the norm. The whole point of judicial review is that it is that last-stop safeguard which individuals or bodies can use. We have mentioned the problem of judicial review in two instances. First, I believe mat the amendment: would vastly increase the scope of judicial review because it would create uncertainty; and it is uncertainty which breeds judicial review. I believe that the Bill clearly provides certainty. The only instance where I foresee the potential use of judicial review is when the Secretary of State has acted inappropriately or unreasonably. No Secretary of State wishes to be accused of that.

With regard to the second part of the noble Earl's question, we are not ignoring the interests of third parties—the so-called innocent bystanders. In reply to the earlier debate and to this debate, I set out how those interests will be dealt with. The noble Earl sought an absolute guarantee that no third party would ever be obliged to pay for anything. No amendment could possibly achieve that because there must be a degree of uncertainty at the very end. British Coal and its liabilities cannot be wound up until there is absolute certainty that those liabilities are transferred to other parts of the public sector, in particular the contingent liabilities.

Lord Northbourne

My Lords, I am grateful to the Minister for attempting to deal with the problem. He has just made an extraordinarily important statement. He said that British Coal cannot be wound up unless all the liabilities have been transferred, I think he said to some other public body. Will he please indicate which section of the Bill states that?

Lord Strathclyde

My Lords, perhaps I may speak with the leave of the House. The noble Lord has put down Amendment No. 6. Perhaps the question could be left until the debate on that amendment which relates more particularly to the demise of British Coal and its liabilities. That amendment has not been grouped with this amendment.

Lord Northbourne

My Lords, yes, indeed, and I shall raise the matter again. I cannot say that I am satisfied. I should like to test the opinion of the House.

5.45 p.m.

On Question, Whether the said amendment (No. 3) shall be agreed to?

Their Lordships divided: Contents, 127; Not-Contents, 121.

Division No. 3
CONTENTS
Addington, L.	David, B.
Archer of Sandwell, L.	Dean of Beswick, L.
Ashley of Stoke, L.	Derwent, L.
Attlee, E.	Desai, L.
Barnard, L.	Donoughue, L.
Barnett, L.	Dormand of Easington, L.
Bathurst, E.	Eatwell, L.
Beaumont of Whitley, L.	Ennals, L.
Belhaven and Stenton, L.	Ewing of Kirkford, L.
Bonham-Carter, L.	Ezra, L.
Bottomley, L.	Falkender, B.
Brentford, V.	Fisher of Rednal, B.
Broadbridge, L.	Foot, L.
Brooks of Tremorfa, L.	Forester, L.
Bruce of Donington, L.	Geraint, L.
Burton, L.	Gisborough, L.
Buxton of Alsa, L.	Gladwyn, L.
Callaghan of Cardiff, L.	Glenamara, L.
Carmichael of Kelvingrove, L.	Gould of Potternewton, B.
Carter, L.	Graham of Edmonton, L.
Clinton-Davis, L.	Gray, L.
Cornwallis, L.	Grey, E.
Craigavon, V.	Hamilton of Dalzell, L.
Darcy (de Knayth), B.	Hanworth, V.

Harris of Greenwich, L.	Newall, L.
Harrowby, E.	Nicol, B.
Haskel, L.	Norrie, L.
Haslam, L.	Northbourne, L. [Teller.]
Hollick, L.	Onslow, E.
Hollis of Heigham, B.	Palmer, L.
Hothfield, L.	Parry, L.
Howell, L.	Peel, E.
Hughes, L.	Perry of Walton, L.
Ingleby, V.	Peston, L.
Jay, L.	Pitt of Hampstead, L.
Jeger, B.	Portsmouth, Bp.
Jenkins of Putney, L.	Quinton, L.
Kennet, L.	Rea, L.
Kilbracken, L.	Redesdale, L.
Kinloss, Ly.	Renton, L. [Teller.]
Kinnoull, E.	Richard, L.
Kirkhill, L.	Ridley, V.
Kissin, L.	Rochester, L.
Knutsford, V.	Saint Oswald, L.
Lindsey and Abingdon, E.	Savile, L.
Lockwood, B.	Scanlon, L.
Longford, E.	Seear, B.
Lovell-Davis, L.	Sefton of Garston, L.
Lytton, E.	Shepherd, L.
Mackie of Benshie, L.	Somerset, D.
Mallalieu, B.	Stafford, L.
Mason of Bamsley, L.	Stanley of Alderley, L.
Mayhew, L.	Stedman, B.
McIntosh of Haringey, L.	Stoddart of Swindon, L.
McNair, L.	Strabolgi, L.
Merlyn-Rees, L.	Taylor of Blackburn, L.
Middleton, L.	Tordoff, L.
Monk Bretton, L.	Weatherill, L.
Monkswell, L.	White, B.
Monson, L.	Williams of Mostyn, L.
Morris of Castle Morris, L.	Willoughby de Broke, L.
Mountgarret, V.	Winchilsea and Nottingham, E.
Mulley, L.	Wynford, L.
Nelson, E.

NOT-CONTENTS
Abercorn, D.	Dixon-Smith, L.
Addison, V.	Dudley, E.
Aldington, L.	Eccles of Moulton, B.
Allenby of Megiddo, V.	Eden of Winton, L.
Annaly, L.	Elles, B.
Arran, E.	Elliott of Morpeth, L.
Ashburton, L.	Elphinstone, L.
Astor of Hever, L.	Elton, L.
Astor, V.	Faithfull, B.
Balfour, E.	Ferrers, E.
Barber of Tewkesbury, L.	Flather, B.
Barber, L.	Fraser of Carmyllie, L.
Beloff, L.	Fraser of Kilmorack, L.
Blyth, L.	Goschen, V.
Boardman, L.	Gowrie, E.
Borthwick, L.	Gray of Contin, L.
Boyd-Carpenter, L.	Hailsham of Saint Marylebone, L.
Brabazon of Tara, L.	Harmar-Nicholls, L.
Bridgeman, V.	Harmsworth, L.
Brookeborough, V.	Harvington, L.
Brougham and Vaux, L.	Hayhoe, L.
Burnham, L.	Henley, L.
Butterworth, L.	Hesketh, L.
Cadman, L.	HolmPatrick, L.
Caldecote, V.	Howe, E.
Campbell of Croy, L.	Johnston of Rockport, L.
Carr of Hadley, L.	Kimball, L.
Chesham, L.	Kitchener, E.
Clark of Kempston, L.	Laing of Dunphail, L.
Colwyn, L.	Layton, L.
Cork and Orrery, E.	Liverpool, E.
Courtown, E.	Long, V.
Craigmyle, L.	Lucas of Chilworth, L.
Cranbome, V.	Lyell, L.
Cumberlege, B.	Mackay of Ardbrecknish, L.
Davidson, V.	Mackay of Clashfern, L. [Lord Chancellor.]
Dean of Harptree, L.
Denton of Wakefield, B.	Marlesford, L.

Merrivale, L.	Skidelsky, L.
Mersey, V.	Soulsby of Swaffham Prior, L.
Milverton, L.	St. Davids, V.
Mottistone, L.	Strange, B.
Mountevans, L.	Strathclyde, L.
Mowbray and Stourton, L.	Strathcona and Mount Royal, L.
Moyne, L.	Strathmore and Kinghorne, E. [Teller.]
Munster, E.
Murton of Lindisfarne, L.	Sudeley, L.
Nelson of Stafford, L.	Swansea, L.
Northesk, E.	Swinfen, L.
Orkney, E.	Thomas of Gwydir, L.
Oxfuird, V.	Trefgarne, L.
Park of Monmouth, B.	Trumpington, B.
Peyton of Yeovil, L.	Ullswater, V. [Teller.]
Rankeillour, L.	Vivian, L.
Renfrew of Kaimsthorn, L.	Wade of Chorlton, L.
Rennell, L.	Wakeham, L. [Lord Privy Seal]
Rodger of Earlsferry, L.	Waverley, V.
Sanderson of Bowden, L.	Wedgwood, L.
Seccombe, B.	Whitelaw, V.
Selborne, E.	Wise, L.
Sharples, B.	Young, B.
Skelmersdale, L.

Resolved in the affirmative, and amendment agreed to accordingly.

5.54 p.m.

Lord Peston moved Amendment No. 4:

After Clause 18, insert the following new clause:

( "British Coal Enterprise

The Secretary of State shall, out of money provided by Parliament, make arrangements to maintain until 31st December 1999 financial support to British Coal Enterprise to an amount equivalent to that provided by the Corporation before restructuring.").

The noble Lord said: My Lords, I shall speak to Amendment No. 4 unless the Minister wishes to comment on the vote which has just taken place. I believe that I heard him say that we could not privatise the industry if the House carried that amendment. Perhaps he may wish to reflect on what he said.

I intervene reluctantly at this late stage with Amendment No. 4. The reason for it is simply that I viewed with dismay the noble Viscount's reply when we debated the matter at an earlier stage. I shall put my anxiety briefly and I shall certainly not divide the House. We all agreed on the great value of British Coal Enterprise. The noble Viscount himself said in replying to the debate: I join all noble Lords in commending the work of [British Coal Enterprise]".—[Official Report, 13/6794; col. 1503.]

There is no difference between us. As a result of the Bill, we still do not know what the future of British Coal Enterprise is. I am well aware that my way of dealing with it in putting down an amendment is unsatisfactory because, to say the least, if we were to accept it, the other place would throw it out on grounds of privilege, since under the amendment we would commit the Government to spending money. So I am well aware of what this is all about.

What concerns me is that everyone agrees that British Coal Enterprise is a satisfactory body which does a good job. Yet the Government say that they have not made up their mind about its future. It is quite absurd to introduce the Bill if the Government have still not thought through something as important as that. I wish to place on record my total dismay at the Government's view of the matter, and I hope that, without any delay and certainly before the Bill becomes law, the noble Viscount will come back and tell us what will happen to British Coal Enterprise. They should do that, if for no other reason, because British Coal Enterprise is successful, it creates jobs and is enormously helpful to the. Government in terms of saving public expenditure. That is why I have made this last protest, but I do not wish to delay proceedings. I beg to move.

The Lord Bishop of Portsmouth

My Lords, as the right reverend Prelate the Bishop of Sheffield cannot be present, and as he originally proposed the amendment, I rise to support it on his behalf. In the view of many people, it is most important that the BCE continues in existence because of the work it does in the present circumstances of the mining industry. It provides advice for those suddenly finding themselves without work; it helps them with job seeking; it helps them with retraining; it helps them with loans, equity schemes and factory and office space if they wish to found new small businesses. BCE has made a significant contribution to employment.

The need is the greater because of the speed of the closure of mines and the shortness of the notice under which those closures have taken place, particularly in comparison with many of our European partners. Consequently, for example, in half the wards in Barnsley 20 per cent. of the employable men are unemployed since the closure of the deep mines there. The need was recognised by the Government when they set BCE up; it was recognised too more than 20 years ago when the British steel industry was set up, as a comparable manufacturing industry closed down.

Much of the objection to continuing the life of the BCE is on the basis of cost. Those who are more expert than I can debate that; but I wish to make the point that in evidence given in 1992 to an all-party committee of the House of Commons on employment, the most reverend Primate the Archbishop of York, together with Cardinal Hume and other Church leaders, made the point that the cost of pit closures could not be assessed simply in financial terms. There is a much wider social effect from unemployment on health and family life.

I conclude by saying that, given the Government's commitment to the regeneration of Britain's coalfields, that commitment will appear hollow if it allows the only agency which is specifically dedicated to the task to disappear at the very time when the coalfield communities' needs are so great. This is clearly not the time even to consider scaling down BCE's activities, let alone winding up the organisation.

6 p.m.

Lord Mason of Barnsley

My Lords, I am very pleased indeed to follow the right reverend Prelate the Bishop of Portsmouth. He has taken over from the right reverend Prelate the Bishop of Sheffield, who moved the initial amendment on BCE during Report stage. He has filled the gap between what the right reverend Prelate the Bishop of Sheffield mentioned at that time and the present debate, in which we now bring the matter to a conclusion—though so far as I can see it will not be a very happy conclusion for the future of British Coal Enterprise.

The Government have offered finances for British Coal Enterprise for the first 12 months after privatisation. They will finance the first 12 months, and then what? BCE cannot plan or invest and it will have difficulty holding onto its workforce. Indeed, the spirit of British Coal Enterprise will die.

During the debate at Report stage I specifically mentioned that there could be a partnership between British Coal Enterprise and Europe. It already works very closely with Europe and the European Regional Development Fund. The noble Lord, Lord Ezra, stated that the European Union has already offered substantial funding for a long period so long as it can be matched pound for pound. The noble Lord seems to favour that course.

The noble Lord, Lord Haslam, strongly supports the continuation of British Coal Enterprise in its present form for at least two to three years to see how its relations with the new Coal Authority and the private sector develop. The noble Lord then mentioned the possibility of a fresh financial package, which might include a cash injection sufficient for BCE to operate as a stand-alone organisation for the foreseeable future. During the course of that debate at Report stage my noble friend Lord Peston gave it great support.

I mention all that simply to point out that every quarter of this House and every party that is responsible for any operations within the coalfield communities all gave support to British Coal Enterprise at its present level. But when the Minister came to reply I must say that what he said was a dampener. It has caused great concern and anxiety in British Coal Enterprise. The Minister ought to try to get this matter cleared up as quickly as possible. It is no good for the future of BCE and the coalfield communities unless it is solved very quickly.

On 13th June 1994, the Minister said: We have received, and are considering, British Coal's suggestions about BCE's future. DTI officials are in discussion with British Coal and BCE on what in future should be the focus of their activities".—[Official Report, 13/6/94; col. 1503] So according to that reply the Government intend to change BCE's operations. The Minister went on to say: Clearly there will be a need (for a time) to settle and retrain former employees of British Coal—essential work which BCE has pursued successfully and single-mindedly. This cannot come to an abrupt end. BCE statistics show that, while some former employees quickly find new jobs, others may take from between 12 and 18 months to settle into new employment".—[col. 1503.] It would appear that the Government have already decided to start to run BCE down. That is very depressing for British Coal Enterprise employees. I ask the Minister: are the Government seriously considering running down the activities of BCE? And do they really have to wait, as he suggested at Report stage, until late autumn before a decision can be taken on this matter, when there must have been months of examination as to the future of British Coal after privatisation and its relationship with British Coal Enterprise? It seems farcical that there can be a Bill of this size, that there is no mention of BCE and that we still do not know what is to happen. The Government ought to give a clear indication this evening as to the future of BCE employees.

Lord Ezra

My Lords, this House will debate tomorrow a Motion relating to employment, com-petition and growth; in other words, the problems of employment in our changing society. What has to be done when society changes, when technologies develop and when old industries go out and new ones come in is that some bridge has to be formed. Some concerted effort has to be made to make sure that people who had employment that is no longer available are given the best opportunity of getting new employment. That has been by common accord, including the views that were expressed by the noble Viscount when we last came to discuss this matter, the achievement of British Coal Enterprise. It has done just that. It has provided a minimum of 100,000 new jobs at relatively low cost —at a much lower cost than by other means. As the noble Lord, Lord Mason of Barnsley, pointed out, it has attracted the attention of the European Commission, which is prepared to provide very substantial funds so long as a matching commitment can be made.

I believe that the reason that the noble Lord, Lord Peston, has moved this amendment—and this is the third time that we return to this matter—is that we remain very concerned. We are worried that a successful operation to find alternative employment in this key industry should now be left in a state of indecision and doubt. It is very difficult to see why this nettle could not have been grasped. Right from the start of our deliberations we have expressed our concern. I ask the noble Viscount when he comes to reply to give us a clearer indication than he gave last time. Then he simply said that he could not indicate precisely when decisions could be taken about the future of BCE because all options would carefully have to be consulted. That seems to me to be a rather off-putting statement on a matter that has created such concern on all the Benches of this House.

Viscount Goschen

My Lords, the Government fully appreciate the purpose of this amendment and the concerns of all noble Lords who have spoken for the long-term regeneration of the coalfield areas. Again, I join with other noble Lords in acknowledging that BCE has made a very substantial contribution indeed to the regeneration of the coalfield areas, helping to create, as the noble Lord, Lord Ezra, stated, over 100,000 job opportunities over the past 10 years; by resettling former British Coal employees into new jobs or training; and by providing loan funds to small businesses and managed workspace developments in coalfield areas.

Between October 1992 and March 1994 more than 24,500 former British Coal employees registered with BCE. Of those, nearly 14,000 have been resettled into jobs or retraining. BCE continues to support about 9,200 former employees who are still actively seeking jobs and aims to maintain its long-term average of resettling some 88 per cent. of its active clients. With the privatisation of British Coal that contribution is gaining even more widespread recognition.

At Report stage I stated that BCE will be retained in its current form throughout the transitional and immediate post-privatisation period. We had indeed received, and are considering, British Coal's sugges-tions about BCE's future. We explained some of the key issues which had been identified and which would require sound and careful conclusions.

The noble Lord, Lord Mason, was right to highlight the Government's view that there will be a need for a time to settle and retrain former employees of British Coal—essential work which BCE has pursued successfully and single-mindedly. That cannot come to an abrupt end. We know that, while some former employees quickly find new jobs, others may take between 12 and 18 months to settle into new jobs with the help of BCE. But that is a diminishing and time-limited task.

BCE's funding and managed workshops play an important role in the regeneration of coalfield areas. That work has complemented other regeneration activities undertaken by the Government and others.

In looking at the longer-term future we need to examine how BCE's work might best continue to complement such programmes. The example that was given at an earlier stage in the Bill was that in recent years BCE has undertaken a substantial programme of building workshops. It is not self-evident that that level of building would be appropriate for another decade. We all have sufficient concern for taxpayers not to want to spend their money on projects that will not necessarily be of the best use. Beyond that, there are a series of issues flowing from the question of whether BCE's future lies in the public or the private sector.

When we considered a similar amendment at Report stage, I understand that it was agreed that these were extremely complex matters and that it would be wrong to leap to hasty and premature conclusions before the options for BCE's future had been carefully examined. That is the view that the Government still take.

I suggest that the present amendment has the same weakness as the former amendment. One might argue for December 1999, the year 2004, earlier, later, or perhaps somewhere in between those years. But we should still be faced with the need to reach sensible and considered conclusions about the future of British Coal Enterprise.

Noble Lords in all parts of the House wish to continue to take advantage of BCE's experience and expertise. That has come out very strongly from our debates both today and at an earlier stage. The Government share that desire. That is precisely why we should take the time necessary to reach considered conclusions.

As it stands, the Bill gives the flexibility for the best choices to be made in respect of BCE. With that explanation I invite the noble Lord, Lord Peston, to withdraw his amendment.

Lord Peston

My Lords, I thank the noble Viscount for his reply. He has left me even more mystified. He put up a better case for BCE in his reply than I did in raising the matter. He then backed away totally and did not make the only statement worth making, which is that the Government are fully committed to continuing the work of BCE.

I and many other noble Lords will press him on many occasions to let us have a definite statement on this. I certainly believe that the least that we require is a statement before the House rises for the Summer Recess. This is an important matter. In my judgment it is in the Government's own interests. I was trying to persuade the noble Viscount of that point.

Having said that, the House has other things on its mind. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

6.15 p.m.

Baroness Lockwood moved Amendment No. 5:

After Clause 22, insert the following new clause:

("Designated mining museums

The Secretary of State shall lay before each House of Parliament a report on the administration of the financial, assistance provided by him for coal mining museums during the period of three years following the restructuring date, within six months of the end of that period.").

The noble Baroness said: My Lords, this is a very modest amendment. It is not as comprehensive as I should have wished. Nevertheless I hope that it will be supported from all parts of the House and that it will receive support from the Minister himself. I am grateful to him for agreeing to a meeting with his representatives and Ministers from the Department of National Heritage and the Director of the Museums and Galleries Commission. That meeting was very useful in enabling us to establish common ground in support of the mining museums.

Those of us who supported the mining museums throughout the Bill had the purpose of preserving all three museums; that is, the Welsh, the Yorkshire and the Scottish museums. Support came from all quarters of the House. Perhaps I may say at this point that the noble Baroness, Lady Masham, asked me to say how sorry she is that she cannot be present this evening as she has had to go back to Yorkshire, where the noble Earl, Lord Swinton, is still ill.

In response to the pressure from your Lordships, the Minister was able to reply on 9th June to a Question for Written Answer from the noble Earl, Lord Swinton, to the effect that £900,000 would be available to those three museums over a period of three years, the money to be divided equally among them. As many noble Lords said at Report stage, we were grateful to the Minister and his colleagues for their efforts in securing that not inconsiderable amount. But, as I indicated, there are problems. Those problems stem from the differences in the three museums.

Both the Yorkshire and Welsh museums have an underground mine to maintain. It is estimated that it costs £290,000 per annum in current terms. It is estimated that the equivalent of £170,000 has been provided in kind by British Coal for the Yorkshire museum and an even greater amount for the Welsh museum. So the shortfall from the privatisation of the mines is very considerable and comes on top of the normal financial difficulties that all museums are experiencing at the present time.

Our purpose in approaching the Third Reading of the Bill was to try to establish some flexibility in the distribution or monitoring of the moneys provided by the Government. To do that it seems sensible to involve the Museums and Galleries Commission, which has a national remit. Incidentally that body has already commissioned a report on mining museums which is likely to be published in the late summer or early autumn. We hope that it will throw further light on the needs of the museums.

However, I am advised that technically it is not possible to place a statutory responsibility on a non-statutory body such as the Museums and Galleries Commission. Moreover, the three departments nominat-ed by the Minister—as the noble Lord, Lord Sanderson of Bowden, made clear in his intervention at Report —have already fixed their eyes firmly on the amounts allocated to them. That presents a very real difficulty.

Our second object was to try to keep the door open in the future without commitment to the present or any succeeding government. It seems sensible for Parliament to look again at the situation as the transitional funding comes to an end. That would give an opportunity to reassess the position in the light of the experience of the museums operating, I hope, in co-operation with the private sector and with its help. I am grateful to the Minister for meeting us on that point.

In summary, what does the amendment do? First, it recognises on the face of the Bill that the mining museums exist and that the Government have accepted some financial commitment to them in the interim period. Secondly, it places a responsibility on the Secretary of State to report to both Houses on the administration of the financial assistance provided after three years, thereby leaving the door open. I beg to move.

Lord Montagu of Beaulieu

My Lords, I support the amendment. At Committee stage, very strong feelings were expressed from all parts of the House about the future of. the museums. Since then discussions have taken place behind the scenes, for which I am grateful to Ministers here and in another place. I am most grateful for their help. Getting money out of the Treasury is never easy and we ought to pay tribute for what has been done. I regret at Report stage that some of us might have sounded a little ungrateful for the transitional finance. In fact what concerned us were the technical aspects of its distribution, as the noble Baroness, Lady Lockwood, has just mentioned.

If the museums are to survive, it is essential to give them a fair wind to raise outside finance. That needs time and continuity. It needs time to approach charitable trusts, local authorities and even the National Lottery. It needs continuity to give sponsors confidence, because no sponsor will invest in short-term matters. Good museum advice is also very much needed and we hope that it will come from the Museums and Galleries Commission.

The object of the amendment is to produce a progress report after two-and-a-half or three years to assess the effectiveness of that pump-priming and to give people a chance to see how things are going. There is no obligation on the Government, the Treasury or anyone else, to continue the finance after that time. We recognise that. But there is a strong obligation on the museums and all interested parties to use their best endeavours to see that a firm financial base is created. It will also give a significant warning to any organisation or institution which may be dragging its feet or behaving in a way which may prejudice the future of the museums that their lack of action may be pin-pointed in a future report as a reason for failure and their attitudes publicised and possibly debated in Parliament.

I have no doubt that proper support will ensure that everybody's mind remains concentrated, for the way ahead is not clear and will be far from easy. I am sure the House would like to give the museums its best wishes for the future. It must be in the national interest that some deep mines are preserved. History will judge that they are just as significant to the history of this country as Magna Charta, the Tower of London or, indeed, HMS "Victory". If we fail to keep them, at least we shall know the reasons why.

Lord Ezra

My Lords, I too support the amendment. I was present at the meeting last night to which the noble Baroness, Lady Lockwood, referred and came away with the firm impression that the Government wished to see the museums continue. They managed to find these resources over a period of three years, which, as the noble Lord, Lord Montagu, said, is quite an achievement when one is dealing with the Treasury. While it is not considered to be sufficient, particularly in regard to the two museums with underground workings, nonetheless it is a base on which they can continue to operate.

I further gained the impression that the matter would be sympathetically handled and that the Government would use whatever endeavours they could, in addition to advancing the finance—I am not talking about more money; there are other ways in which the Government can help—to see that the museums continue. If the amendment is accepted, as I hope it will be, a particular achievement will be that the museums will be referred to specifically on the face of the Bill and the Government will accept the commitment, after the three-year period, to present a report to Parliament.

Lord Callaghan of Cardiff

My Lords, I am sorry that I have been absent from the House. I am obliged to the Minister for writing to me about these matters. I was not able to join in the general pressure on him and I congratulate my colleagues because I understand that the amendment is not wholly unsatisfactory to the Government. That shows a remarkable effort on their part and we all owe them great thanks, to which I certainly add my name.

I wish to echo what the noble Lord, Lord Ezra, said in regard to help in kind. If one cannot obtain anything out of the Treasury by way of money, let us see what we can obtain elsewhere. Two of the pits in particular have underground workings and need supplies and machinery for that. I trust that we shall be able to rely on the good will of the Minister and others in keeping that aspect of the matter open. The third pit in Scotland is not in the same position.

I do not wish to be a Cassandra, but I received a letter from one of the directors of the museums who said that the degree of reduction in costs which will be required for the two pits we are discussing to stay viable is more than they can reasonably accommodate. When one looks at the figures, they indicate that they would need to make an immense effort if they are to do that. I have a feeling therefore that we shall be returning to the matter. However, if in the meantime supplies can be continued in kind, I trust that we shall be able to keep open these valuable museums of our industrial history.

Lord Morris of Castle Morris

My Lords, the noble Lord, Lord Dainton, asked me to apologise to your Lordships for the fact that he had to leave before the end of the debate. He and I agreed that the needs of these three museums are really very diverse. Secondly, their capacities to raise funds by charging, from charities or from industry, differ greatly one from the other, and therefore an equal division between the three museums of this welcome £900,000—an identical grant to each in each of the three years—would be quite inappropriate.

The noble Lord and I both sat on the Museums and Galleries Commission. One question I should like to address to the Minister is why the Museums and Galleries Commission was never consulted on the proportion of money available to be allocated to each museum. We would undoubtedly have informed HMG at once that the needs of the two were infinitely greater than the needs of the third and that a tapering grant over three years was now so standard that anything else looks like an anachronism.

Both the noble Lord, Lord Dainton, and I congratulate the Minister on having wrung out of the Treasury a sizeable sum to avoid trouble over the museums. But I must say to the Minister that whoever advised him to dish it out in three equal lumps made a complete dog's breakfast of the allocation. Therefore we would urge the Government that, while stating that they are prepared to make the report that they intend to make, they should not commit themselves as to the yearly allocations they will make to each museum until they receive and consider the views of the Museums and Galleries Commission.

Lord Strathclyde

My Lords, I am delighted to join this debate at this point, particularly in view of the fact that this is the third time that we have dealt with the issue of mining museums. I like to think that this is one of the easiest times that the Government have had on the whole question.

We have been left in absolutely no doubt whatever about the importance that noble Lords attach to the continuance of these museums. I am particularly grateful to Members on all sides of the House. There has been a great deal of cross-party work, co-ordinated to some extent, for which I am grateful, by my noble friend Lady Trumpington who speaks in this House for the Department of National Heritage and the Parliamentary Under-Secretary in that department, Mr. Sproat. Between them they have gone a considerable way to allay the fears of those who are interested in the future of the museums. That is why I announced on 9th June a package of assistance which is unprecedented for museums, and one which many of the other 1,100 independent museums in the UK will envy. Nevertheless, I believe that the Government were right to announce this assistance, given the unique circumstances of coal privatisation.

The House will recall that under the terms of my announcement transitional funding of no less than £900,000 over three years will be made available to the Yorkshire Mining Museum, the Scottish Mining Museum, and the Big Pit Mining Museum in South Wales to replace the help in kind currently provided by British Coal.

I know that many in this House have spoken strongly in support of the Yorkshire Mining Museum. The assistance that I announced is a fair estimate over a three-year period of the cost of the services that they would need to continue in operation. And while there is no prospect of further government assistance after that three-year period, the trustees of the museum will have been given a breathing space in order to find other forms of funding. Thus, the Department of National Heritage asked the Museums and Galleries Commission to administer the funding that the museum will receive from the department, and the commission indicated that it would be glad to do so. Hence the commission will be fully engaged in helping the museum. In addition, the director for the National Museum of Science and Industry indicated that he would be very happy to help the museum in whatever way he can by, for example, giving advice or by facilitating meetings with potential sponsors.

The other two museums, the Big Pit Museum in South Wales and the Scottish Mining Museum, come under the responsibility of the Secretaries of State for Wales and Scotland. I noted the remarks made at the Report stage and again by the noble Lord, Lord Morris of Castle Morris, on the relative allocation of funds to these museums, but it would have been wrong to exclude either of them from transitional assistance. The equal funding given to these two museums and the Yorkshire Mining Museum does, I believe, meet the particular circumstances of this case. Certainly none of the three has been disadvantaged by the fact of assistance given to the other.

I come to the substance of the amendment that we are now discussing. I recognise the concern that the issue of mining museums should be studied. In this connection, the House may know that the Museums and Galleries Commission is already conducting a review of United Kingdom mining museums. This is due to report in the summer, and I am sure that it will be a most useful contribution to consideration of future strategy in this area. I understand from the commission that the report will be made public. My honourable friend the Parliamentary Under-Secretary for National Heritage will be very pleased to ensure that copies are placed in the Libraries of both Houses.

The Secretary of State for National Heritage has announced a review of his department's policy towards museums. This will be the first review of policy for museums to be undertaken for many years. It will cover all aspects of policy towards museums, including the position of industrial museums, of which mining museums are an important part. The House will not expect me to anticipate the conclusions of the review. The Government's present firm policy is that they are responsible only for funding directly the national museums and one or two others for which they have inherited responsibility. The Secretary of State will have to consider many competing claims, including representations from some of the 1,100 other independent museums, none of which has been the subject of such special assistance. Nevertheless, every aspect of museum policy will be addressed in the review, and I can assure the House that the claims of mining museums will not be forgotten.

On that basis, having carefully considered the amendment, I am glad to tell the House that the Government will not oppose the amendment and indeed will be delighted to accept it. There is a small proviso to that acceptance, as there always is on such occasions. The drafting is not as expert as it might have been in the circumstances. If this amendment is approved, another place will certainly wish to examine it, but the substance of it will be accepted by the Government. I believe that this is an extremely good result for all those who are interested in the museums. I should like to single out the noble Baroness, Lady Lockwood, who spoke so eloquently on the subject at Second Reading, and my noble friend Lord Swinton, who sadly cannot be with us today.

Baroness Lockwood

My Lords, I am very grateful to the Minister for accepting the amendment, albeit with the slight caveat that he mentioned. I will not take further issue with him on the allocation of the sum. However, I should like to underline the fact that all along we have been concerned with the needs, albeit different ones, of the three museums, which are making a tremendous contribution to our national heritage. We want to preserve that. I hope that, if necessary, the door will not be finally closed. Just as we cannot commit a future government to giving support, I hope that this amendment will not close the door to a future government giving further support if that proves necessary. I commend the amendment to the House.

On Question, amendment agreed to.

Clause 23[Reduction in membership and dissolution of the Corporation]:

Lord Northbourne moved Amendment No. 6.

Page 19, line 3, after ("exist") insert ("and that proper provision has been made to meet any outstanding or potential obligations of the Corporation").

The noble Lord said: My Lords, this is another amendment that is designed to protect innocent third parties. It simply ensures that the Secretary of State will not dissolve British Coal until he is satisfied that adequate provision has been made to cover all of the liabilities of British Coal, including future ones arising out of past acts and omissions of the Coal Board.

With the permission of the Minister, I should like to quote part of a letter that he was kind enough to send me: It is clear to me that no reasonable Secretary of State could conclude that it was unnecessary for the Corporation to exist before provision had been made, for example by means of a restructuring scheme, for all outstanding liabilities to be honoured in full. Those liabilities would of course include any remaining contractual liabilities entered into by the Corporation under a lease, as well as any remaining tortious liabilities already incurred by the Corporation".

Clause 23(2), as amended by my proposed amendment, would read: As soon after the restructuring date as it appears to the Secretary of State that it is no longer necessary for the Corporation to continue to exist, and that proper provision has been made to meet any outstanding or potential obligations of the Corporation, he may by order dissolve the Corporation …

It seems to me that there is nothing between us. Therefore, in order to avoid future uncertainty, I simply ask the Minister either to show the House where in the Bill this matter is satisfactorily and unambiguously dealt with or to accept my amendment. I beg to move.

Lord Morris of Castle Morris

My Lords, this is a very sensible amendment. We support it.

Lord Renton

My Lords, this is an innocent and helpful amendment, and we should be deeply grateful to the noble Lord, Lord Northbourne for moving it. Bearing in mind that it fulfils what was said in the letter from the Minister after the noble Lord and I had had a valuable exchange of views with my noble friend Lord Strathclyde, I would have hoped that the amendment could be accepted.

With regard to the letter and the part of it that the noble Lord, Lord Northbourne quoted, I feel obliged to comment on the words "no reasonable Secretary of State". That is not binding on future Secretaries of State; indeed, it is not legally binding on the present Secretary of State, although as a matter of honour he would not dream of going behind it. A ministerial letter is not part of the law. The great virtue of the amendment, though not the only one, is that it removes doubt.

In the letter which the Minister sent to the noble Lord, Lord Northbourne, it was also said that the Secretary of State's decision would be open to judicial review. That is a very limited advantage. Proceedings for judicial review have to be started within three months of the decision by the Secretary of State, and that may well be too short a time for tortious liabilities to appear. I am sorry to have to say that, although I am very much in favour of judicial review as a safeguard in certain circumstances, in these particular circumstances it is not a sufficient safeguard. But the noble Lord's amendment not only removes doubt but is necessary and desirable. I hope that on this occasion my noble friend Lord Strathclyde in his wisdom will feel that it can be accepted.

Lord Ezra

My Lords, I too should like to support the amendment. I hope that on this occasion, as on the amendment that we have just discussed, we shall have the happy outcome of full agreement on all sides of the House.

Lord Strathclyde

My Lords, the last time I congratulated the noble Lord, Lord Northbourne, upon bringing this matter to the attention of the House—after I had made what I thought was an extremely adequate explanation of policy—he voted against me and won. I shall not thank him and congratulate him on bringing forward this matter, but I hope to give him considerably more reassurance than I did last time. Perhaps he will then not feel that it is worth testing the opinion of the House.

The amendment deals with the Secretary of State's power to dissolve British Coal and the provision which is to be made for British Coal's liabilities in the run up to dissolution. The Secretary of State's power to dissolve the corporation, which is contained in Clause 23(2), is quite specific and quite strict. The corporation may only be dissolved when it appears to the Secretary of State that it is no longer necessary for the corporation to continue to exist. That is what appears on the face of the Bill. The Secretary of State could only take such a decision following consultation with the corporation itself and with the Coal Authority.

I am advised that the meaning of this provision is very clear. If there remain liabilities attached to the corporation it must, by definition, be necessary for the corporation to exist. So before British Coal is dissolved the Government would have to make provision for all remaining liabilities to continue to be honoured. The liabilities mentioned here would include any remaining contractual liabilities entered into by the corporation under a lease as well as any remaining tortious liabilities already incurred by the corporation.

It has been suggested that the Government may somehow magic away these liabilities when the corporation is dissolved. I hope that I can reassure your Lordships, and particularly my noble friend Lord Renton, on that point. Under the Bill the Government could not do that even if they wanted to—not just this Government but any government; and not just as a question of reassurance but as a question of law.

The only remaining question to be dealt with is that posed at the end of his speech by the noble Lord, Lord Northbourne. He said that if he and I are in such agreement, why do we not accept his amendment. First, I have some technical difficulties with the amendment as it uses the vague term "obligations" rather than "liabilities", which is the term used in the Bill. But far more substantive: what the noble Lord wants is already achieved in the Bill. I am sure that it must be in all our interests to reduce the amount of unnecessary legislation. I hope that my noble friend Lord Renton in particular, who is such a stickler in these matters, would agree that we should avoid unnecessary statutory provisions. On that basis, I hope that my noble friend Lord Northbourne can agree.

Lord Northbourne

My Lords, I am extremely grateful to the noble Lord for that very strong assurance. I shall read Hansard and hold him to it. On that basis, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 7 not moved. ]

Clause 43 [Persons responsible for subsidence]: [Amendments Nos. 8 and 9 not moved.]

Clause 55 [Health and safety regulations as to rescue service]:

Lord Ezramoved Amendment No. 10:

Page 51, line 26, at end insert ("provided that approval shall only be given to a scheme which maintains the same or a greater level of service as that in existence immediately before the restructuring date.").

The noble Lord said: My Lords, I return to this amendment, which I had meant to move at the Report stage but time did not allow for that to be done, not only to emphasise the importance of the Mines Rescue Service but also to ask whether the Government, on reflection, could not accept this small amendment in order to emphasise the great degree of expertise and competence that needs to be maintained in the Mines Rescue Service.

The noble Lord, Lord Strathclyde, wrote me a letter on this subject because I had discussions with him in the interval between these two stages. He explained that it was not necessary to have the amendment because what it sets out to do has already been set out in legislation dealing with safety in 1974. I agree that there is some similar wording in that legislation. However, the circumstances of 1974, when the coal industry was a nationalised industry—I happen, by coincidence, to have been chairman of the enterprise at that time—and the circumstances of today are totally different. We are now changing a single unitary body which paid the highest possible regard to safety into a number of as yet undetermined other bodies.

I should have thought that it would be desirable, just as we obtained the Government's agreement in the end to have the question of the mining museums put on the face of the Bill, that this issue should be put on the face of the Bill. We expect to have those very high standards of safety maintained. I do not consider that the amendment would do any harm to the sense of the clause. I hope therefore that, on reflection, the noble Lord will agree to the inclusion of the amendment. I beg to move.

6.45 p.m.

Lord Morris of Castle Morris

My Lords, naturally we support the noble Lord, Lord Ezra. The Government's position has always been that the Mines Rescue Service will not: be less efficient under privatisation than it is at present. I therefore have to inform the noble Lord the Minister that there has always been a full-time fully trained brigade on first call and that after that part-timers came in as necessary. I must also inform him that in the past three weeks closures of full-time brigade stations have begun. One is at St. Helen's—the Wigan rescue station—with at least eight fully-trained men. A second is at Doncaster, with about 12 to 14 fully-trained full-time men. The third is at Rhydaman in West Wales, which has reduced its part-time rescue staff. In view of their commitment to maintaining the standard, what have Her Majesty's Government to say about that?

Lord Haslam

My Lords, British Coal's Mines Rescue Service has been shown to be outstanding in dealing with all the highly complex and difficult problems which arise in mining activities. This service far exceeds that which is required under the fire and rescue regulations because experience has shown that to meet the demands of industry, this higher standard is needed. It is essential, therefore, that the proposed rescue service be based as a minimum on this existing standard and that every new owner should be fully committed to it as a condition of operation.

Major incidents or explosions are now fortunately a rarity, but if one does occur this is the ultimate test. If the new service is found wanting, it will be very apparent for all to see. With this in mind I firmly believe that any future organisation should continue on a national basis, with a strong full-time element, ensuring that the same breathing apparatus and ancillary equipment are generally available nationally and that the rescue brigadesmen across all the coalfields are trained in the same procedures. With that in mind, I strongly support Amendment No. 10.

Lord Strathclyde

My Lords, all sides of the House recognise the vital importance of mines rescue, and that view is fully shared by the Government. There is absolutely no difference between us on this most important principle. Therefore, I fully recognise the concerns behind the amendment. But I shall explain why it is not necessary or desirable to have the amendment on the face of the Bill.

However, first, I must reiterate that it is because the Government recognise the vital role of the Mines Rescue Service that they consulted the tripartite Health and Safety Commission at the earliest stage and that they are now taking steps, in line with the advice of the commission, to ensure that standards will be maintained and to ensure that there will continue to be a service with a national capability after privatisation.

Those standards currently set by British Coal's rescue service are based on the provisions of the Coal and Other Mines (Fire and Rescue) Regulations 1956. It is those regulations which the Health and Safety Commission proposes to replace with a new set of regulations made under the Health and Safety at Work etc. Act 1974—the 1974 Act. The Health and Safety Executive has conducted a detailed review of rescue working closely with the industry through the National Advisory Committee on Rescue Work and Rescue Apparatus, on which British Coal, the licensed mines and the major mining unions are all represented, with a view to bringing forward proposals for new regulations.

The review resulted in the letter from the commission of 26th January to the Minister of State for Employment which has been made available to the House and which sets out the commission's views on the basic requirements for rescue. The letter envisages that a cornerstone of the new requirements will be that no mine shall be worked unless it has available to it effective rescue arrangements suitable for that mine.

These new regulations will reflect modern circum-stances and take account of the changing structure and proposed privatisation of the industry. The Health and Safety Executive are working in full consultation with the National Advisory Committee to prepare draft regulations setting out the necessary requirements. The House may therefore be assured that those with the most direct concern that the new regulations should maintain existing standards of rescue are fully involved in their development. Furthermore, all interested parties will have the opportunity to comment on the proposals when the regulations are put out for consultation by the Health and Safety Commission.

The amendment proposed by the noble Lord, Lord Ezra, is unnecessary because there is already an existing statutory provision in the 1974 Act. Section 1(2) of the Act requires that regulations brought forward by the Health and Safety Commission to replace existing statutory provisions must be, designed to maintain or improve the standards of health, safety and welfare established by or under those enactments". I do not think there is any doubt that this provides the assurance that is being sought by this amendment. An additional duty in the Bill would not add to this safeguard; indeed it could detract from it by placing a question mark against the commission's role as the guardian of standards embodied in health and safety legislation. I have sent the noble Lord, Lord Ezra, a copy of the relevant extract from the 1974 Act, as he has acknowledged.

Clause 55, together with the existing statutory powers and duties of the Health and Safety Commission under the Health and Safety at Work etc. Act 1974, will ensure that existing standards of rescue, including a national rescue capability, must be maintained. I believe that that is the crucial aspect. On the basis that I have convinced the noble Lord, Lord Ezra, I believe that it has been a valuable opportunity for me to read into the record exactly what our intention is and what our thinking has been as regards these clauses.

Lord Ezra

My Lords, I thank the noble Lord for that explanation. I believe that the Committee will be generally heartened by the importance which the Government clearly attach to the Mines Rescue Service and to the standards which should be either maintained or possibly improved. However, I am sorry that, for what appeared to me to be slightly legalistic reasons, this modest amendment could not be included on the face of the Bill.

There are the apprehensions which have been mentioned by other Members who have spoken. The noble Lord, Lord Morris of Castle Morris, spoke about the recent closures of some of the mines rescue centres. The noble Lord, Lord Haslam, pointed out that it was not sufficient in the past and it will not be sufficient in future, if these mines rescue teams have a standard which simply complies with the law. They have always had higher standards which need to be motivated. I feel that that could have been usefully mentioned on the face of the Bill. However, in the light of what the noble Lord has said, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 64 [Interpretation]

[Amendment No. 11 not moved.]

Schedule 5[Pensions Provision in connection with Restructuring]:

Viscount Goschen moved Amendment No. 12:

Page 106, line 32, leave out from ("surplus") to end of line 33 and insert: ("(aa) so much of any pension obligation arising under the scheme as represents the effect on any pension right giving rise to a pension obligation falling within paragraph (a) above of any decision before 1st September 1994 to appropriate any of a relevant surplus determined as at a time before 31st March 1994 to the payment of increases in any pensions payable in pursuance of that right; and").

The noble Viscount said: My Lords, it may be for the convenience of the Committee if, in moving this amendment, I speak at the same time to Amendments Nos. 13 and 14.

The Government gave notice at Report stage that they would be bringing forward an amendment to Schedule 5 to remove a possible inconsistency of a technical nature between paragraph 2(12) and other provisions of paragraph 2. The purpose of the amendments is to ensure that the Secretary of State is able to modify the existing schemes in line with the agreement reached between the Government and the trustees on the new pension arrangements. The amendments clarify the pension rights arising from pre-privatisation surpluses giving rise to principal pension obligations which it has been agreed that the Government, in modifying the pension schemes, will have no power to affect adversely. With that brief explanation of these technical amendments, I beg to move.

Lord Morris of Castle Morris

My Lords, I have studied these amendments. The pension trustees are content with them. They seem to me to be sensible, useful and helpful. We welcome them.

On Question, amendment agreed to.

Viscount Goschen moved Amendments Nos. 13 and 14:

Page 106, line 34, leave out ("so arising") and insert ("arising under the scheme").

Page 106, line 36, after ("(a)") insert ("or (aa)").

The noble Viscount said: My Lords, I have already spoken to these amendments. I beg to move.

On Question, amendments agreed to.

Schedule 8 [Amendments of the Opencast Coal Act 1958]:

Lord Stanley of Alderley moved Amendment No. 15:

Page 121, line 4, at end insert:

("Terms on which orders to be exercised

—(1) The owner of the interest against whom the compulsory rights order (in this paragraph referred to as "the owner") has been made shall be entitled to—

1. (a) payment on the basis of either—
   1. (i) the open market value of the rights granted as would have been fair and reasonable if the agreement had been made between a willing grantor and a willing grantee, or
   2. (ii) the compensation for the losses caused to him assessed in accordance with sections 17 to 23 of this Act,
   whichever is the higher, and
2. (b) secure such terms, guarantees and other security from the person entitled to occupy the land in respect of which the compulsory rights order is conferred (in this paragraph referred to as "the operator") as are necessary to protect the owner from any loss, damage, claims or other costs related to the exercise of the compulsory rights order.

(2) For the purposes of sub-paragraph (a) (i) of this paragraph, the assessment of the open market value shall take into account—

1. (a) the basis on which the operator has entered into agreements with the owners of other interests to permit the working of the same coal deposit, and
2. (b) the basis on which the owners of other interests have entered into agreements with the operator or other mining companies for the extraction of coal on comparable sites.

(3) For the purposes of sub-paragraph (a) (i) of this paragraph, the fact that the operator is in or to be in, a special position by reason of his having secured the licence under Part II of this Act to the exclusion of others shall be ignored.").

The noble Lord said: My Lords, before I deal with the two amendments in my name, I would like to thank my noble friend Lord Strathclyde not just for his Amendment No. 19, which is grouped with this amendment, but also for the time and trouble that he and his department have taken to try to come to a compromise over the problems caused by the Government's wretched compulsory rights order. My noble friend's Amendment No. 19 is helpful and so were his detailed remarks at Report stage as reported in the Official Report for 13th June at cols. 1568 to 1571. Perhaps rather confusingly, I also refer to col. 1574.

My noble friend has moved towards an agreement. Perhaps, as a generous marker of exams, I might give him four out of 10. But I fear that I would get only two out of 10 for my efforts as I have had to concede much more, in that I am not proposing the abolition of CROs, which was my starting point. I am more than aware that most of the Members of the Committee and the noble Lord, Lord Peston, consider that I have been pathetic in so conceding—that is to say, going ahead with the CROs.

Therefore, I am sad that my noble friend's four out of 10 mark forces me to move my Amendments Nos. 15 and 16 to reinforce my noble friend's Amendment No. 19. My Amendment No. 15 is similar to that moved at Report stage. It spells out the conditions which must be met before the Secretary of State approves a CRO. He may only do so when, first, the land is needed to supply a market which cannot be met elsewhere; secondly, the owner has acted unreasonably; thirdly, the amount of coal is in excess of 250,000 tonnes —which reflects the present position—and, fourthly, the owner or owners cannot be found.

My Amendment No. 16 spells out the terms to be offered. Perhaps I may summarise them. It is what would be offered as compensation between a willing grantor and a willing grantee—that is to say, the open market price. I have to repeat that this is the crux of my case. My noble friend Lord Strathclyde tried to tell me that this was too difficult to define. Then my noble friend took from col. 1567 to col. 1571 to explain the Government's method of compensation. Perhaps I may say that it took me only one column to explain mine. Moreover, he suggested in col. 1569 that my case was weak because I needed Sections 17 and 23 of this Act as well. I am surprised that he did that.

The reason for including this matter in my amendment is that some farmers or small businesses particularly, may have invested in equipment for specialised use whose value might be less than the investment and the return that can be made from them in that particular specialised business. We all know about the specialised pig unit or the horticultural one. Talk about the pot calling the kettle black! I believe that my noble friend comes into that category.

Moreover, my noble friend's suggestions are not on the face of the Bill so valuers and lawyers are unlikely to pay much attention to them. I believe that my noble friend has been misled by his advisers. There are valuers well able to arrive at what a willing grantee would pay a willing grantor, though I doubt if there are many in the Department of Trade and Industry or in Rothschilds, whose main and only interest it seems is to flog off the industry at the greatest price regardless of natural justice to landowner, householder or indeed the countryside. I hope that word is parliamentary language but, to me, "flog" is a better description in this case than "sell".

I have tabled Amendment No. 17 merely to get my noble friend to explain a matter that was raised in the other place on Second Reading on which I think that we need some slight technical explanation.

I conclude by saying that I am much in favour of privatisation, as opposed to noble Lords opposite who I know are not. But both they and I are in entire agreement in believing that if privatisation is to take place, the small print must be correct. In this case, I believe that the small print is seriously flawed. I beg to move.

7 p.m.

Lord Morris of Castle Morris

My Lords, on Report, the Minister made some interesting statements. I quote from the Official Report of 13th June at col. 1569: I cannot see that it would automatically be unreasonable for the landowner to seek more compensation than the statutory provision". If I may say so, that is an interesting locution which implies that it may not be unreasonable but in many, or most, cases it would be considered to be so.

The Minister then said at col. 1574: Generally speaking, landowners … have to consider what safeguards they want to give as assurance that obligations such as restoration will be carried out. This is reasonable: after all, they are to obtain an income from the development". The income provided under the 1958 Act is sufficient to provide a rent and a profit which would have been received by the landowner and the occupier anyway. There is no provision for any payment related to the new use, the development, of the land. If the income is to reflect the risk that the owner and occupier are carrying, it should be greater and it should be freely negotiated. The Minister's argument can only support the abolition of CROs.

The Minister also said: The point that I made was that the landowner can demand a security".—[Official Report, 13/6794; col. 1574] That is not true. The owner can seek it—I suppose that he can demand it—but he will not get what he demands if the CRO is made. He will get only such security as the authority considers to be reasonable, subject to the confirmation of the Secretary of State.

All of those comments and all that is said in support of the amendments prove the need to ensure that CRO powers are used only where they are necessary in terms of real need for coal and that the terms of any such order should recognise the responsibilities to the owners and occupiers affected.

Viscount Ridley

My Lords, I have hesitated to take part in this debate in support of the noble Lord, Lord Stanley, not least because I do not like doing so when I am personally involved in the industry. However, this is so important and I believe that by declaring an interest in opencast coal mining I have something to offer. I suggest that I have more practical experience of it than any other noble Lord in the Chamber.

My family estate has suffered for over 50 years from opencast coal mining. About 1,000 acres have been worked in that time. I can confidently state with experience that the land takes at least a generation to recover. Some of it will never recover and is permanently damaged. Add to that the disappearance of springs and trees and the fact that huge boulders mysteriously rise upwards through the soil, and so on, not to mention the noise, dust, mud and general disturbance while it is all going on and while the restoration takes place. I do not know how many of your Lordships have seen that, but I hope that you will do so before considering this matter.

It all started in the war under the Defence of the Realm (Acquisition of Land) Acts which, rather cynically, went on long after hostilities had ceased. Cynicism is not new in government. The compulsory powers were enshrined under the 1958 Act which we all know. I remember my father fighting against them in that year in this House. Since then, those compulsory powers have hardly ever been used by the National Coal Board or British Coal, so it is a shock to see them not only continued but available, in effect, to the private sector under the Bill.

All that disturbance and heavy loss was totally acceptable —indeed, it was welcome—during and after the war when coal was in short supply and badly needed in the national interest. Nobody could object to that. But that is not the case today. Coal does not need special compulsory powers any more than any other mineral. Nor do I deny that in recent years landowners have been able to make satisfactory deals about sites below the 0.25 million tonne mark—profitable to all sides: to the Coal Board, and to contractors as well as to owners, operating entirely under the free market forces in which I had thought that this Government profoundly believed. I do not see why that market cannot continue, but the abolition of the 0.25 million tonne limit prohibits that. Nor do I see why such forces could not operate at any level in the future.

As was said at an earlier stage, landowners will have the Sword of Damocles hanging over them with the CRO powers in reserve. However, it is not only Viscounts who will suffer, but smaller owners and, yes, we are talking about people's gardens. That will happen occasionally and substantial losses may be experienced.

We all realise that the Minister says that those powers will be available only "in the last resort", but the Bill does not tell me how "the last resort" is defined. The amendments of the noble Lord, Lord Stanley, would do that. Furthermore, the Bill does not tell me who will define "the last resort". I think that it may be the same person who defines "the national interest" and perhaps the same person who decides planning appeals. I strongly support the amendments which will define such matters.

I also realise that the powers will run for only five years. But just imagine the pressure to get CROs in the last few days of that five-year period. It will be just like at this very minute when, in the last few moments of British Coal's existence, it is trying to get approval to work sites about which it has done nothing for years. I did not think that the Government would ever give compulsory powers to commercial interests and so distort the free market in this way.

I should like to put one more question to the Minister. Why has the planning authority not been able to see the prospectus, which is known as the Rothschild Memorandum, which is available only to potential bidders and then at a high cost? In my case, the county council, the mineral planning authority, believes (from what it can discover) that the coal reserves which have been offered for sale must include several areas where planning permission has already been refused on appeal. If that is so, I think that it is, as they say in Dublin, very deceitful. Whoever buys the coal reserves may have to pay a great deal of money for something that they cannot exploit unless they are prepared to go through the whole planning process again to appeal.

The noble Lord, Lord Stanley, used the word "flog". I think that I would use the phrase, "The Government want to get the highest possible price at the expense of everybody else", and I am afraid that I have to say that the answer to all this is that the Government's interest is not necessarily the same as the national interest. As someone put it to me less elegantly, "The calf is being fattened for the slaughter". I doubt whether the Government can deny it.

Lord Peyton of Yeovil

My Lords, I find this issue particularly difficult. My first reaction on reading this part of the Bill was to think how objectionable it was that any compulsory powers should be passed to a private interest. On second thoughts—I have already declared a rather tenuous interest myself—I believe that there is another point of view. It is the one that I think the Government are trying to follow.

I should also say at the beginning of my remarks that I am particularly sorry to find myself differing from the noble Viscount, Lord Ridley, with whom I have had a great deal of very friendly and helpful contact. Even though we may disagree tonight, we both share a profound concern about what could happen in the North East if employment is not sustained.

It seems to me that the Government have at least gone quite a long way towards meeting the objections and producing some kind of balance in this real, genuine and difficult conflict. First, the powers that were enjoyed by the National Coal Board, and latterly by British Coal, are not being transferred to a mining company. They are being transferred to the Coal Authority which will have, or could well be expected to have, a degree of impartiality which no mining operation could begin to claim.

I am not sure what the effect of my noble friend's amendments will be. However, we must be careful not to lock up forever a most valuable asset which could play a large part in sustaining industry and employment in the North-East. In the present climate in the North-East, to render an important resource unusable would be a retrogressive and unfortunate step.

The power will exist for only five years, which is an important move. Secondly, the power will not be held by a mining concern but by the Coal Authority. Thirdly, no compulsory purchase order will be issued without the approval of the Secretary of State. In saying that, I must admit that I have not always found that to be a tremendously valid or convincing argument. However, I suppose that one is entitled to cherish the hope that every now and again Secretaries of State will behave reasonably and decently.

The power will be exercisable only in the event of a landowner proving unreasonable. I appreciate that will be a difficult matter of judgment but it is an attempt to produce a reasonable, workable balance where otherwise the situation would be tilted hopelessly the other way. A further move by my noble friend has been to provide that an offer, once made by a mining company, cannot subsequently be withdrawn. Furthermore, other minerals; which should be obtained will be separately paid for.

I do not feel altogether happy about the matter. For some time, and now only slightly, I have been involved with British Alcan, which is an important employer in the North-East. If that company does not obtain access to coal which enables it to carry out a smelting operation at an economic rate it will inevitably have to close the total smelter. That would be a disaster for that part of the world. Not only would the employees of the smelter lose their jobs, but there would be a considerable knock-on effect for other industries.

It would be wrong for me to seek to expand on that point now, but it is a matter which we should bear in mind. There is another angle to this; very vexed, sensitive and difficult problem.

Lord Sanderson of Bowden

My Lords, sitting on this side of the House, I too find this one of the most difficult parts of the Bill. Like my noble friend Lord Stanley, I wish to see a successful privatisation. We must be most careful because, looking at Amendments Nos. 15 and 16, I believe that we could deal a serious blow to the privatisation of the coal industry. Like my noble friend Lord Peyton and others, I am convinced of the growing importance of opencast mining, even if the noble Lord, Lord Morris, does not like it.

We must be careful to get the balance right. While I too dislike the idea of statutory limits and statutory powers on CROs continuing for five years, I believe that if we are to succeed in seeing the industry move into the private sector we must be careful not to make haste too quickly. We must deal with the issue most carefully and get the balance right.

During each stage of the Bill, my noble friend the Minister has listened carefully to what has been said by my noble friend Lord Stanley. I too have my reservations about what is proposed in the Bill. However, I believe that the willing buyer/willing seller situation, in particular in Amendment No. 15, would create huge uncertainties about the cost of access to sites because of the lack of precedents.

I believe that the Government may have the balance right. We must try to ensure at least that those who seek to bid for the various regional areas will not have their hands tied behind their backs to such an extent that they find it impossible even to put in a bid.

7.15 p.m.

The Earl of Lytton

My Lords, I support the amendments tabled by the noble Lord, Lord Stanley. It is my understanding that in speaking to Amendment No. 15, the noble Lord referred to conditions dealt with in his Amendment No. 16 and vice versa. I believe that he transposed them, but if I am mistaken I apologise.

I listened with great care to what was said by noble Lords opposite about the rights and wrongs of compulsory rights orders. I suppose that as a practitioner in the area of compulsory purchase and compensation, I should declare an interest. It was always understood that where there was an overriding public interest, which was ostensibly for a non-profit purpose—in other words, for some strategic need of the nation which could not be quantified—the loss to the vendor who was obliged to sell to the acquiring authority was the measure on a before-and-after basis. However, it is a different situation when the main thrust of the Bill is to prepare an asset in the public sector for sale to the private sector. Apart from the question of whether there is a need for a transitional provision, there is the much wider public interest factor on how we deal with the whole question of property rights and what is a fair balance between them.

I believe that, over the years where there was an established public need, the interest of the individual in terms of having a stake in the commercial outcome fell to be overridden. I am afraid that I do not consider that that case has been made here either in absolute terms or in a five-year interim period. I cannot take the point made by the noble Lord, Lord Peyton, that the assets are locked up. It is merely a question that there will be a slightly lower or perhaps a materially lower product for the private-sector operator and therefore the price will be reduced. I believe that most of those matters can be dealt with through the price mechanism, something which we consistently hear from the Government. I do not believe that that is the death knell of the principle of privatisation.

I take no side on that principle. That is outside my remit. If that is what the government of the day have decided, so be it. It is not for me to comment on that. But with regard to the public interest issue, the interests of private rights in land ownership are important, as are the private rights of householders and businesses. I do not believe that businesses in the countryside—and they are businesses in the same way as any other business—can stand to have their rights and assets diminished in some way in order to enable a more satisfactory prize to be offered on the open market to private operators.

I agree that it is a difficult concept to grasp and that many people will be anxious about the interim period as we move from the public to the private sector. But the underlying property rights principle is fundamental and we should not depart from it lightly because of the precedent that that will set. Particularly in this country where there is no written constitution and where our constitution is formulated by precedential matters over the ages, we should be extremely careful about going down that road. For all those reasons, I support warmly the amendment moved by the noble Lord, Lord Stanley.

The Earl of Harrowby

My Lords, I too would like to take the line of the noble Earl who has just spoken. I gained the impression from my noble friend Lord Peyton that my noble friend Lord Stanley proposes the abolition of CROs. My noble friend Lord Stanley might have preferred that, but he has not done so. I do not believe that the anxieties expressed by two noble Lords are relevant in the terms of the amendment. I am not an expert on the subject but I shall certainly support my noble friend Lord Stanley if he presses the amendment to a Division.

Reference has been made to what noble Lords on the Front Bench opposite may or may not believe. I pay tribute to them. Having accepted that it is government policy to privatise—I endorse that entirely and hope that it is a success—they have been entirely objective in their consideration of the Bill at all its stages. Their one aim has been to improve the Bill for the purpose for which it was brought forward. I am personally grateful to them for that.

Earl Peel

My Lords, although I was not present during our deliberations on Report, I supported the amendment when it was moved by my noble friend in Committee. In view of the considerable support which my noble friend received from all sides of the House, I am surprised that we have reached the stage at which we are now. We have not made much progress.

The major difference between this amendment and the amendment moved in Committee is that this is a much more conciliatory amendment. I should have thought that that would have satisfied my noble friend Lord Peyton. I listened extremely carefully to what he said and have a great deal of sympathy for it. But having read the amendment carefully, I believe that it does and should satisfy the very real anxieties which my noble friend expressed.

We return again to the whole question of national need. As has been said many times, it is quite clear that it does not exist at present. One of the points which I made in Committee is that I see the CROs as what I might describe as a back-door subsidy. I have always been surprised that the Minister is not confident that the new licensed operators will be able to operate successfully without having the CROs to back them up.

In Committee my noble friend said that a CRO is not a compulsory purchase power because of the time limits involved; but it really is the next best thing. He said also that CROs are powers of last resort and that is how they will continue; but we cannot get away from the fact that they are hardly conducive to what one might describe as free negotiation and free collective bargaining on the whole question of property rights, to which the noble Earl, Lord Lytton, referred.

My noble friend gave an example of when a CRO might be used; namely, when an owner had unreasonably refused to negotiate or sought unreason-able terms. Why should he not do that? That is what the free market is all about. Whether we like it or not, CROs wilt be a genuine threat to free negotiation. I know that on this side of the House there remains very grave anxiety that the Government have been too quick to allow basic property rights to be undermined through legislation. I fear that this is yet another example of that happening.

I realise that in this case we are talking about a very few instances, but the principle remains. Therefore, I support warmly my noble friend's amendment.

Lord Strathclyde

My Lords, I was extremely impressed by the words of my noble friend Lord Harrowby who told me something that I had not realised. He said that the Opposition had accepted that British Coal should be privatised. Noble Lords opposite are shaking their heads. Therefore, my noble friend was wrong and they are not in favour of privatisation. That is why they support the amendment.

Lord Peston

; My Lords, of course we are not in favour of privatisation, but the noble Earl, Lord Harrowby, was making a different point: if that is what the Government are determined to do, we are trying to make it less of a mess than they seem to want to make it. That is our position.

Lord Strathclyde

My Lords, if noble Lords opposite are such experts on privatisation, how is it that every single successful privatisation that this Government have brought to the market has been against the advice of noble Lords opposite? I can guarantee that that will be true once more in regard to the privatisation of coal.

My noble friend Lord Peel said that he was surprised that we were discussing this issue yet again. The Government have brought forward a great many amendments in the course of their negotiations with my noble friend Lord Stanley and his friends. Yet again today the Government are proposing amendments which will be of great benefit to those who believe that they may suffer unduly under the regime of CROs or indeed where they have agreed freely to an opencast coal mine.

I should first like to speak briefly to the government amendments included in this group; that is, Amendments Nos. 19, and 21 to 24. I mentioned in our debate at Report that we were still considering a further significant amendment to the Opencast Coal Act. I am glad to be able to introduce that today. My noble friend Lord Stanley referred in Committee to the practice of British Coal, which always leaves its last offer on the table even when it has decided that it is necessary to make a CRO and which is always prepared to make an agreement in preference to the CRO, even after the CRO has been made and even after the CRO has been confirmed.

I hope I have made very clear by now our firm intention that those compulsory rights should be strictly procedures of last resort and that rights for opencasting should be secured by agreement to the maximum extent possible. To that end, it would be very desirable for British Coal's practice to be carried forward into the privatised coal industry, and we have been considering how best to do that.

Amendments Nos. 22, 23 and 24 accordingly provide for a new ground of revocation of the CRO after confirmation. Landowners will be able to agree terms on the basis of a previous offer provided that they put this in writing within 28 days of the operator serving notice of the date of entry on to the land. The Coal Authority will then be able to revoke the CRO in any case in which the operator, without good reason, declines to stand by the previous offer. I believe that that in itself will be an important safeguard for landowners as to the way those procedures will be used during the transitional period to 1999. I also mentioned in our debate on Report that we were considering a further clarification of the new section already introduced dealing with landowner's minerals. Further discussions between my department and the Country Landowners' Association have shown that there are reasonable doubts as to whether that section does what both sides would wish it to do. I have clarified the position in Amendment No. 19.

As invited by my noble friend Lord Stanley, perhaps I may comment briefly on Amendment No. 17 to which he spoke. Section 14 of the Opencast Coal Act deals with various rights and duties of agricultural tenants and their landlords, as they apply where the demised land, or part of it, is temporarily used for opencasting but the planning permission provides that the land is to be returned to agricultural use. The effect is, broadly, to preserve the agricultural tenancy during the opencast working. In particular, no notice to quit can be served on the tenant.

The effect of my noble friend's amendment—and I can think of no one less likely to bring forward such an amendment—would be to wreck the protection given the tenant, so that a notice to quit could be served. I am absolutely certain that that was not the intention of my noble friend. Obviously, it would be unthinkable for the Government to accept the amendment.

I turn now to the key amendments in the group; namely, Amendments Nos. 15 and 16. It is important to set the issue of opencast compulsory rights in the right perspective. The Bill is about privatising the coal industry. I have made it absolutely clear that the Government's aim in the process is to have the largest economically viable coal industry in the longer term. I believe that that aim is widely shared on both sides of the House. Obviously privatisation is an enormous challenge for the industry. The Government hope and believe that it will surmount that challenge. We certainly want to give it every opportunity of doing so.

The opencast industry is an integral part of the coal industry. We recognise, and understand, the concerns which can arise over opencast developments and their environmental impact. But I hope that noble Lords will not be under the misapprehension that, in striking a blow against the opencast industry, they would be doing a favour to the deep-mined industry in the UK. The fact is that the coal industry will stand or fall together. If a serious doubt was to be cast at this moment over the prospects of the opencast industry, that would undermine the prospects of the industry as a whole.

There is no simple or straightforward solution to the question of compulsory powers. That is why I share so much the sentiments expressed by my noble friends Lord Peyton and Lord Sanderson of Bowden. They both feel great discomfort at the issue of CROs but realise the importance of having them, at least during the transitional period. There is a view, which is shared by the Government, that there should not be a separate regime for coal. That point was made by the noble Viscount, Lord Ridley. We have in hand an appropriate review which will enable us to move in a considered way to a single regime for all the extractive industries.

However it is also widely accepted that the existing general regime is complex, expensive, and uncertain; and is generally not a practical route for securing minerals access. It would be a serious change to the outlook of the coal industry if its existing regime were to be removed before the review of that regime was complete and implemented. In other words, if the amendment were agreed to, it would entirely pre-empt the considered approach of those in the mining industry, in planning authorities, in the private sector and in the Government.

The Government are not riding roughshod over the interests of landowners. In fact, the proposals that we have made are undoubtedly beneficial to landowners in a number of important respects. They provide new, necessary safeguards for their interests which I have entirely supported in the discussions that I have had with my noble friend Lord Stanley. Perhaps I may outline some of the proposals. First, the power to initiate compulsory rights orders will no longer be in the hands of the mining industry itself. In future, it will be for the Coal Authority—which, unlike British Coal, will have no mining interests of its own—to consider applications for an order and to decide impartially whether the making of an order is proper and appropriate in the circumstances.

Secondly, the Government have made available explicit guidelines showing, on the policy of the authority, that it is intended that it will only make such orders in the last resort and after all reasonable efforts to obtain the agreement of landowners have failed. They will also secure that any reasonable requirements for appropriate financial security are met. Orders will remain subject to confirmation by the Secretary of State. They have indicated their view that no order should be confirmed unless it is in the public interest to do so.

Thirdly, in Clause 52, the Bill sets an absolute limit of 31st December 1999 on the continuation of those compulsory rights powers. That date cannot be extended by regulation, and any new compulsory powers after that date will have to be based on new primary legislation which would, of course, come before your Lordships' House. Fourthly, the Government have initiated the comprehensive review of compulsory access powers generally which I mentioned a moment ago, with the aim of establishing a single regime for all mineral industries.

Those are all measures which were part of the Bill, or the framework within which it is to work, when the Government introduced it in another place. Since then there have been many discussions with the Country Landowners' Association and further safeguards or improvements have been introduced where we could put in place procedures to ensure that landowners will be notified of all applications for coal mining licences in respect of their land. The Government have brought forward amendments enhancing the compensation to which landowners will be entitled, to cover minerals other than coal. Moreover, the new clause which I introduced a little while ago gives the landowners the assurance that they will be able to go back to the operator's best offer.

There is no reason to think that compulsory rights will be made available more freely in the future than in the past. Quite the reverse. The more formal procedures which I have described, and the tests which operators will have to meet at each stage, will tend to make it less likely that they will seek to have recourse to those procedures.

As to the amendments tabled by my noble friend, they identify two key issues—the terms on which CROs can be conferred and the circumstances in which they could be granted. I dealt with those issues at some length on Report. I shall not try the patience of the House by covering the same ground twice.

However, I believe that the Government's approach is both robust and reasonable. It will not unleash a flood of CROs on the heads of landowners. It will not allow secretive operators to steal a march in some way on unprepared landowners. It will allow landowners to seek more compensation than the statutory code where they have a reasonable case for it in the particular circumstances, while retaining the statutory code as a minimum in every case to provide a degree of certainty which should be helpful to both sides. On the other hand, it will not unreasonably restrict CROs so that none could ever be made except in an emergency.

It will be clear that there are key points in each of the amendments of my noble friend which I cannot accept. There are other points, particularly in Amendment No. 16, which do not need to be covered in the Bill because they have already been covered procedurally.

We are of course wholly at one with the aim of a regime which will be fair and reasonable towards landowners. The Government have in fact made great efforts to ensure that that is the case and have responded to concerns that have been put on behalf of landowners. But if the suggestion is that all change should only take place on landowners' terms, without giving fair treatment to the interests of other parties, then I cannot agree and I have to say that I believe that your Lordships' House will be doing itself a disservice if it adopts that approach.

The noble Viscount, Lord Ridley, questioned the whole approach to opencast coal-mining. I believe he said that the Government's approach was deceitful. I must tell the noble Viscount that there is no question of pre-empting the planning process. The memorandum makes clear that the grant of planning consents is, and will remain, a matter for the planning authorities. It will be for the regional coal companies to apply for the necessary consents for new sites in the normal way.

I would say to the noble Earl, Lord Lytton, that it is true that what we are considering is a change from the public sector to the private sector, but there will be no change in the law and there will be considerable safeguards in changing from the old regime to the new. It was my noble friend Lord Peyton who I think recognised most of all the dangers inherent in accepting these amendments as regards the more fragile areas of the country where coal-mining has continued, but has continued because there are valuable customers nearby. Those customers may well withdraw their custom if there is doubt and uncertainty in the regime. That is why I am surprised to note that the noble Lord, Lord Dormand of Easington, who is such a great crusader for the North East, is not defending the Bill as it stands.

Lord Dormand of Easington

My Lords, I think the Minister is aware that I am concerned chiefly about employment. He is quite right to say that I have frequently raised that matter, because it seemed to me an appropriate thing to do at the time.

Lord Strathclyde

My Lords, that of course is a matter for the noble Lord to decide for himself. I was trying to offer him some guidance. The issue that is central to this matter is certainty. We have already dealt with amendments earlier today on the matter of certainty. At the moment there is no doubt as to what the law recommends. If this amendment is accepted, there will be considerable doubt and it will plunge the coal industry into uncertainty by taking away the existing arrangements. This would damage the prospects of the industry and in view of the safeguards that we have provided we would regard that damage as needless and unnecessary.

The Government have done everything they reasonably can, in discussion with landowners, through new procedures and through amendments to the Bill, to ensure that proper concerns are met. I am convinced that the Government have spelt out an approach to compulsory rights that is fair and reasonable to all parties. My noble friend Lord Stanley has not had all the cake but he has had a considerable part of it and I would hope that he would accept that. If pressed, I therefore must ask the House to reject these amendments.

Lord Stanley of Alderley

My Lords, I thank all noble Lords for their support and in some cases for their contributions. I should refer quickly to the remarks of the noble Lord, Lord Peyton. He said that the Coal Authority would be impartial, but I am not sure about that. He did not spell out why we must have CROs for six years and why they should not stop now. As my noble friends Lord Harrowby and Lord Peel said, my conceding CROs right at the start answers the question concerning an unreasonable refusal to allow mining. That really is quite a large concession, as I have tried to explain to the House and to my noble friend.

I am extremely worried that my noble friend Lord Peyton is worried about this matter, as is my noble friend Lord Sanderson. I can only suggest that they relax. With their interest in developing mining operations, I am not surprised at the remarks that they have made. I always think that someone who has to declare an interest, as the noble Viscount, Lord Ridley, said, is always of the greatest value. I am sure the whole House was struck by what he said.

The point that was made the strongest and best was made by the noble Lord, Lord Morris of Castle Morris, when he asked how a landowner can make a demand —he shouted the word "demand" two or three times —when he has the threat of a compulsory rights order over him. As my noble friend on the Front Bench tried to suggest, there is no question whatsoever that this will be a landowner's benefit. As I have reminded your Lordships before, I am not a landowner. It is small householders and small businesses that worry me desperately in this regard. As the noble Lord, Lord Morris, said, a landowner will have one hand tied behind his back, and if he considers the compensation that was spelt out by my noble friend Lord Strathclyde —or perhaps I should say not spelt out—it puts him in an even weaker position.

I will not detain the House any longer. My noble friend Lord Strathclyde was, as usual, in his most persuasive form. In fact he spoke rather better than I have ever heard him speak and that is saying rather a lot. But he really made the same points as he has made before. Like him, I do not intend to weary the House with those points. Having listened to your Lordships, I am sorry to say that I must revise the mark that I gave him of four out of 10 to two out of 10. I therefore must ask for a decision from the House.

7.45 p.m.

On Question, Whether the said amendment (No. 15) shall be agreed to?

Their Lordships divided: Contents, 83; Not-Contents, 72.

Division No. 4
CONTENTS
Addington, L.	Falkland, V.
Airedale, L.	Forester, L.
Attlee, E.	Gould of Potternewton, B.
Barnard, L.	Graham of Edmonton, L.
Bathurst, E.	[Teller.]
Beaumont of Whitley, L.	Greenway, L.
Burnham, L.	Grey, E.
Burton, L.	Hamilton of Dalzell, L.
Buxton of Alsa, L.	Harris of Greenwich, L.
Carmichael of Kelvingrove, L.	Harrowby, E.
Carter, L.	Haskel, L.
Cornwallis, L.	Holderness, L.
Craigavon, V.	Hollis of Heigham, B.
Cross, V.	Hothfield, L.
Darcy (de Knayth), B.	Jeger, B.
David, B.	Kilbracken, L.
Dean of Beswick, L.	Kinloss, Ly.
Derwent, L.	Knutsford, V.
Desai, L.	Lawrence, L.
Donoughue, L.	Lindsay, E.
Dormand of Easington, L.	Lindsey and Abingdon, E.
Dundonald, E.	Lockwood, B.
Elphinstone, L.	Lytton, E.
Ewing of Kirkford, L.	Mallalieu, B.
Ezra, L.	Mancroft, L.

Merlyn-Rees, L.	Ridley, V.
Middleton, L.	Ripon, Bp.
Monkswell, L.	Roxburghe, D.
Monson, L.	Saint Oswald, L.
Morris of Castle Morris, L.	Savile, L.
Mountgarret, V.	Sefton of Garston, L.
Nicol, B.	Shannon, E.
Palmer, L.	Somerset, D.
Parry, L.	Stanley of Alderley, L. [Teller.]
Peel, E.	Stoddart of Swindon, L.
Perry of Walton, L.	Teviot, L.
Peston, L.	Turner of Camden, B.
Prys-Davies, L.	Wharton, B.
Raglan, L.	White, B.
Rea, L.	Williams of Mostyn, L.
Redesdale, L.	Willoughby de Broke, L.
Richard, L.	Wise, L.

NOT-CONTENTS
Addison, V.	Lauderdale, E.
Annaly, L.	Leigh, L.
Arran, E.	Long, V.
Ashboume, L.	Mackay of Ardbrecknish, L.
Astor, V.	Mackay of Clashfern, L. [Lord Chancellor.]
Balfour, E.
Barber, L.	McColl of Dulwich, L.
Blatch, B.	Mountevans, L.
Borthwick, L.	Moyne, L.
Brookeborough, V.	Northesk, E.
Brougham and Vaux, L.	Oxfuird, V.
Clark of Kempston, L.	Park of Monmouth, B.
Colwyn, L.	Pender, L.
Craigmyle, L.	Peyton of Yeovil, L.
Cranbome, V.	Renwick, L.
Cumberlege, B.	Rodger of Earlsferry, L.
Dean of Harptree, L.	Sanderson of Bowden, L.
Denton of Wakefield, B.	Seccombe, B.
Dixon-Smith, L.	Selborne, E.
Elibank, L.	Skelmersdale, L.
Ferrers, E.	Soulsby of Swaffham Prior, L.
Fraser of Carmyllie, L.	St. Davids, V.
Glenarthur, L.	Strathclyde, L.
Goschen, V.	Strathmore and Kinghorne, E.
Hacking, L.	[Teller.]
Harlech, L.	Thomas of Gwydir, L.
Harmar-Nicholls, L.	Trefgame, L.
Harmsworth, L.	Trumpington, B.
Harvington, L.	Ullswater, V. [Teller.]
Haslam, L.	Vivian, L.
Henley, L.	Wade of Chorlton, L.
Howe, E.	Wakeham, L. [Lord Privy Seal.]
Ironside, L.	Wedgwood, L.
Jeffreys, L.	Whitelaw, V.
Kenyon, L.	Wynford, L.
Kimball, L.	Young, B.
Lane of Horsell, L.	Zouche of Haryngworth, L.

Resolved in the affirmative, and amendment agreed to accordingly.

7.53 p.m.

Lord Stanley of Alderley moved Amendment No. 16:

Page 121, line 4, at end insert:

("Conditions to be satisfied before a compulsory rights order is made

A compulsory rights order shall not be made or confirmed unless it is shown that it has not proved practicable to obtain the right by private arrangement because the owner has acted unreasonably and that—

(a) (i) the coal in the relevant land is required to supply a market which cannot adequately be met from other sources which are currently being worked or capable of being worked where a coal mining company has secured all the relevant planning consents and has acquired the necessary interests in land, and

(a) (ii) the amount of marketable coal to be extracted as a result of the compulsory rights order being made exceeds 250,000 tonnes; or

(b) there is a present likelihood that the coal will remain unworked on account of other development proposed on the relevant land; or

(c) the persons with power to grant the right, or any of them, cannot be ascertained or cannot be found; or

(d) the persons from whom the right must be obtained or any of them, have not the necessary powers of disposition, whether by reason of defect on title, legal disability or otherwise.").

The noble Lord said: My Lords, I beg to move. On Question, amendment agreed to.

[Amendments Nos. 17 and 18 not moved.]

Lord Strathclyde moved Amendment No. 19:

Page 132, leave out lines 17 to 21 and insert:

("(3) Where, in the case of any minerals, it would be reasonable for steps for making them saleable or for enhancing their value to be taken on the land between—

(a) the time when those minerals are got, and

(b) any sale of the minerals by the operator from the land, it shall be assumed, for the purpose of determining the market value of those minerals as at the time mentioned in subsection (2) above, that the minerals were in the same condition at the time so mentioned as they would have been had those steps already been taken.

(3A) Any question for the purposes of subsection (3) above as to the extent to which it would be reasonable for any steps to be taken in relation to any minerals shall be determined as at the time mentioned in paragraph (a) of that subsection and on the assumption that it is not reasonable for steps to be taken where the total cost to the operator of taking those steps is equal to or more than the difference between—

(a) what would be the market value of the minerals for the purposes of subsection (2) above if it were reasonable for those steps to be taken; and

(b) what would be their market value for those purposes if it were not;

and for this purpose, where the minerals would not be saleable without the taking of those steps, the market value referred to in paragraph (b) above shall be taken to be nil.").

On Question, amendment agreed to.

[Amendment No. 20 not moved. ]

Lord Strathclyde moved Amendments Nos. 21 to 24:

Page 132, line 39, after ("state") insert ("the amount appearing to the person giving the notice to be the amount which for the purposes of subsection (2) above is to be taken to be").

Page 132, line 43, leave out ("made") and insert ("confirmed").

Page 136, line 16, leave out ("subsection") and insert ("subsections").

Page 136, line 24, after ("Act") insert: ("(4B) Where in the case of any compulsory rights order made or confirmed at any time on or after the restructuring date (within the meaning of the Coal Industry Act 1994), it appears to the Coal Authority—

1. (a) that the order would not have been made or confirmed, or would not have extended to certain interests or rights, if a person to whom a relevant offer was made had accepted it,
2. (b) that that person has, since the making of the order, made a written offer to the person entitled to the rights conferred by it ('the operator') to enter intoan agreement on the terms of the relevant offer,
3. (c) that the written offer was made either at a time before the specification of a date in relation to the order as the date of entry or at a time more than twenty-eight days before any date so specified,
4. (d) that the person making the offer will enter into an agreement with the operator on those terms if the order is revoked or varied under this subsection, and
5. (e) that the circumstances (apart from the expiration or rejection of the relevant offer and the making and confirmation of the order) are not such as to make it unreasonable for the operator to be required to treat the terms of the relevant offer as still available for acceptance, 253 that Authority may, by notice to the operator and subject to such conditions as it thinks fit, either revoke the order or vary it by limiting it so that it does not extend to the interests and rights of the person who is offering to be bound by an agreement on the terms he previously failed to accept.

(4C) In subsection (4B) above 'relevant offer', in relation to a compulsory rights order, means any offer which—

1. (a) was made by the applicant for the order to a person who is one of the persons directly concerned; and
2. (b) was an offer as to the terms on which the applicant was willing (instead of requiring rights as against that person to be conferred by a compulsory rights order) to enter into an agreement with that person.").

The noble Lord said: I beg to move Amendments Nos. 21 to 24 en bloc.

On Question, amendments agreed to.

Lord Strathclyde

My Lords, I beg to move that the Bill do now pass.

Lord Morris of Castle Morris

My Lords, I am grateful to the noble Lord for giving way. I am a little puzzled and would welcome clarification whether the noble Lord, Lord Stanley, has not moved or withdrawn the consequential amendments to the amendment which was passed.

Lord Stanley of Alderley

My Lords, with the leave of the House, perhaps I may clarify the situation. Your Lordships agreed Amendment No. 15. As I was running down the aisle, Amendment No. 16 was called by the noble and learned Lord the Lord Chancellor, and I shouted "I beg to move".

Amendment No. 17 was answered by my noble friend, and therefore I did not move it. My noble friend had another amendment—Amendment No. 21—which tidied up my own amendment, Amendment No. 18, which was similar. I hope that that answers the noble Lord.

Lord Morris of Castle Morris

My Lords, I am grateful. Mea maxima culpa.

Lord Strathclyde

My Lords, perhaps we may now move on. I beg to move that the Bill do now pass.

We have had a series of interesting and wide-ranging debates on the Bill, perhaps none more interesting than the debate we have had this afternoon, although I regret the loss that we have suffered at the hands of the House.

The range of subjects that we have covered reflects the tremendous history of the industry and the large part it has played in industrial development and in so many people's lives over a long period of time—from compulsory rights to concessionary fuel, from safety to subsidence, from water pollution to pensions, from miners' welfare to mining museums. On a lighter note, I should add my thanks to the noble Lord, Lord Morris of Castle Morris, who has quoted from the Old Testament, through Goldsmith to A.E. Housman, to perhaps a bit of Virgil, although I cannot guarantee that. But we have not been loving enough for any Catullus. That indicates that we have ranged widely, but I believe that the quality of our debates has not suffered.

We saw two important announcements by the Government. On the first day of Committee I was able to make an important statement on water pollution and pumping, which provided material reassurance on an area of anxiety to many in this House and outside. At Report I was able to announce an important development in the policy on health-related liabilities.

It was perhaps inevitable that in a complex Bill of this size there would be Government amendments. However, I hope that the House will agree with me that the number of amendments that we have had to make has been comparatively small and that the majority have been in the nature of technical tidying up amendments.

However, there is one area which I wish to distinguish from the rest, and that is pensions. Your Lordships will recall the strong commitment on pensions which the Government made at an early stage in this privatisation. Although the amendments made to the pension provisions in the Bill were highly technical, they were important and reflected the Government's genuine desire to provide proper safeguards for the pension entitlements of those in the British Coal pension scheme.

I should also mention the amendment which the Government made to bring in a new clause on liability for inaccurate information. Although I would not wish to over-emphasise the importance of the amendment, it offers reassurance to those third parties who might suffer a loss.

We have won some amendments and we have lost others. However, we have dealt spectacularly well with a number of issues concerning safety, to some extent liabilities and miners' welfare. These are all of the greatest importance and I fully understand the desire of noble Lords to reflect that on the face of the Bill.

Privatisation has achieved an outstanding record of industrial success in this country. I am sure that the coal industry, with its great history of achievement, will make full use of the opportunities which the Bill presents and will take its place among the other former state-owned enterprises which are now doing so well in the private sector.

In concluding, I should like to thank the noble Lords opposite, in particular the noble Lord, Lord Morris of Castle Morris, his noble friend Lord Peston, and of course the noble Lord, Lord Ezra, for the. courteous and businesslike way in which they approached our consideration of the Bill. We are fortunate in this House in having so much experience and expertise in so many areas. That was amply demonstrated in debate on the Bill. I believe that we were able to take the discussion into relatively technical areas and to maintain a high standard of debate. In that respect, I pay tribute to the former chairman of British Coal who spoke in the debates on the Bill, and to noble Lords who in one capacity or another have had responsibilities connected with the coal industry. In addition, there were noble Lords who came from mining families and who were brought up in mining areas. Other noble Lords have direct experience of dealing with the coal mining industry from the point of view of the property owner or landowner. I thank all of them for their valuable contributions to the debates.

I thank my noble friends who have contributed to the debates. I have been well supported—some of the time; sadly not always—but in particular I thank my most able Whip, my noble friend Lord Goschen, for his support. Last but not least I thank the officials in the Department of Trade and Industry, the Bill team, which has worked tirelessly to make sure that amendments were tabled on time, explanations given and letters written.

It is an important piece of legislation for an important industry. The transfer of the coal industry to the private sector will be a momentous step. My only regret is that I suspect that we shall have to deal with the Bill once more when it comes back from another place. I sincerely hope that that experience will not be too tortuous.

I am sure that as the Bill leaves your Lordships' House, all noble Lords will join me in wishing it well for the future. I commend the Bill to the House.

Moved, That the Bill do now pass.— (Lord Strathclyde.)

Lord Morris of Castle Morris

My Lords, this is, by time-hallowed tradition, the point in the passage of any Bill through your Lordships' House at which, in turn, we rise up and offer to each other high praise and hearty thanks for all the goodness and loving kindness we have extended to each other over the past weeks. It is also customary to thank the caretaker, the vicar for the use of the hall, and the ladies (God bless them) for making the sandwiches.

It gives me great pleasure fully to participate in the ritual thanksgiving, and to begin with my noble friends on the Front Bench, particularly the percipient Lord Peston, the monumental Lord Mason, Lord Dormand, doyen of the County Palatine, Lady Turner, whose vigilant care for all aspects of employment so impresses us all—I think it frightens the Government, I know it fortifies me—Lady Lockwood, who has so effectively taken up the running on the matter of the mining museums when the noble Earl, Lord Swinton, was struck down by illness, and (if I may group them like amendments) my countrypersons Lord Prys-Davies, Lord Williams of Elvel, and Lady White.

While in Wales, I cannot forbear to add the name of the noble Lord, Lord Stanley of Alderley, who causes the Government such trouble and does the nation such good, but I shall refrain from mentioning by name other noble Lords opposite to whom I owe a debt of gratitude for fear it may prejudice their prospects of promotion. This allows me, however, to recall the sterling contributions made to our debates by the noble Lord, Lord Ezra, who, like the noble Lord, Lord Haslam, has the advantage of having governed the industry and therefore knows what he is talking about; the noble Lord, Lord Northbourne, whose close and careful study of the Bill has been evident in the shrewd amendments he has tabled, and which have met with no reward; and, memorably, from the spiritual Bench, the right reverend Prelate the Bishop of Sheffield. A Labour member of Sheffield City Council spoke to me of him last week, and said: "Ay, he's Right wing on too many things, but when it comes to t'miners his heart and his head's in t'right place". I am grateful to him for his support.

It is not our custom to thank those who have, like flying butresses, supported us from outside. So I shall say nothing about the splendid work of Clare Cozens, our researcher. I shall not mention Andrew Pym or the Country Landowners' Association, and on the contribution of Barbara Edwards and the Coal Communities Campaign my lips are forever sealed.

To the noble Lord the Minister, however, I may, can, and do offer thanks and congratulation on the way he has steered the Bill through its stages in your Lordships' House. He has been knowledgeable—too knowledge-able at times for me—well-informed, sagacious and loquacious, as, indeed he ought to be, with the entire Civil Service at his service for preparation. But he has also been invariably courteous, patient, civilised in discourse, and shrewd in negotiation. And these are personal qualities for which the whole House will be as grateful as I am. And his right-hand man—who seems always to sit on his left—the noble Viscount, Lord Goschen, has displayed, when deployed, qualities alarmingly similar to those of his noble friend the Minister.

The Bill itself is perhaps marginally better, a touch tidier, now than when it came to us "with all its imperfections on its head" from another place. But in its thrust and purpose it remains sadly the same. It was well described as "the ultimate privatisation" because it was born not out of economic necessity, not out of any need to create a competitive industry, and not, God knows, out of social concern or compassion for the coalfield communities. It was, in our view, begotten by irrelevant ideology out of revengeful desire to bring the miners to heel, and to crush for ever the power of the National Union of Mineworkers.

It has its inescapable origins in the bitter events of the miners' strike of 1984 and 1985, and we should never forget the anger of those times when policemen faced each other and their own brothers and fathers across the picket lines. I shall never forget watching the convoys of strike-breaking lorry drivers, escorted by police along the motorways in South Wales and Yorkshire, and the sullen and burning resentment of worker divided against worker in coalfield communities which survives to this day.

And the resentment has not receded in the last decade, as is witnessed by the astonishing outburst of anger nationwide when the President of the Board of Trade made that brutal announcement about pit closures last year. Who would have dreamed it possible that Mr. Arthur Scargill could have been cheered to the echo as he walked at the head of a demonstration by miners down Park Lane and through Mayfair? But it happened, last year, and it happened because the ordinary people of this country turned against the brutality with which the miners, their families, their children and their communities had been treated by a Government more interested in victory and vengeance than in justice and in the healing of wounds.

We shall never forget that this Bill, this "ultimate privatisation", is the tombstone of the British mining industry as we have known it, the last nail in its coffin. It parcels out the remnants of an industry deliberately weakened and run down by a Government which rigged the energy market against coal, and then looked on impassively as the inevitable happened, and pit after pit closed and miners swelled the ranks of the unemployed yet again.

We have done our best with the inevitable progress of the Bill through the House. But to be of absolute certainty, my Lords: the Labour Party does not like it. In the end the Bill is simply an irrelevance which permits the scavengers and the salvage experts to come in, pick over the bones, and pick up the profits. The "successor companies", if and when they make their successful bids, are not entrepreneurs. They are merely the undertakers, the funeral directors who will, by virtue of this Bill, send the British coal industry to its account, "unhousled, disappointed, unaneled".

Lord Ezra

My Lords, I approach the Bill with one deep regret. It is that the industry which was the object of the legislation should be of such a diminished size. When both the noble Lord, Lord Haslam, and I, who had experience of the industry in its immediate post-war period, remember its size and and importance then and its diminished size now, we cannot avoid feeling very sad.

The purpose of our deliberations on the Bill has been to make it as effective as possible for the industry at its present size to survive and, we hope, to grow. I believe that between us we have managed to achieve that. I believe that the Government have taken serious note of the points raised during our debates here and that as the Bill leaves us it is much improved compared with what it was when it started.

The Government have recognised the importance of the vexed question of liabilities and made many concessions. I pay tribute to them on the question of pensions—all the more telling for me as I happen to be a recipient of a Coal Board pension. I am delighted that, as regards myself and the other 600,000 pensioners, we have been fairly treated. I will say that. Therefore, that particular bone of contention never came up in our debates.

We addressed the question of safety many times and I believe that the Government fully recognised its importance. I regret that they were reluctant to have more said about safety on the face of the Bill.

On miners' welfare, again the Government were of assistance, but I fear that the problems of miners' welfares handled by CISWO are such that their task will increase in the years ahead and in the early part of the next century, rather than diminishing. I hope that that will be taken note of when the situation is reviewed.

On British Coal Enterprise, I believe that the Government recognise the importance of the undertaking and I hope that they will come forward soon with positive proposals. Perhaps we shall have the opportunity of taking note of them in discussions in this House at some early future date. I hope that the Coal Consumers' Council will be replaced with some equivalent body. I personally would have been much in favour of retaining it so that domestic consumers of coal can feel that their interests are safeguarded, just as they are in other basic fuel industries. Finally, as a result of a happy meeting last night, we have managed to reach agreement on the future of the museums and therefore pay tribute to the great heritage inherent in the coal industry.

I wish to join the noble Lord, Lord Morris, in paying tribute to the Minister and his colleague for the very sympathetic way in which they dealt with many of the points which we raised. I am also grateful for the trouble taken to write those long and informative letters which came so promptly after discussions with them. They are well served in their department in that respect.

All in all, we had a successful debate; we are now sending back to the other place an improved Bill. I hope that the other place will accept without demur all the amendments that were introduced.

Lord Sanderson of Bowden

My Lords, on a day when the British Nuclear Industry Forum has warned the Government that that industry's contribution to United Kingdom electricity supply will fall from 25 per cent. to 3 per cent. over the next 25 years if no new reactors are built, it is important to wish well to this Bill and all who will be involved in its implementation.

I shall make three comments to the Government which I hope they will consider to be helpful. First, as regards opencast operations, it is very important for all parties interested in mining companies that British Coal settle promptly outstanding historic claims. Otherwise, it will not be easy, particularly for new entrants, to quantify those claims, which I believe is an important part of the privatisation exercise.

Secondly, I believe it is absolutely vital for prospective operators—and I am sure that they will obtain this—to have the Government's assurance that both the Government and their agencies are, and are seen to be, absolutely even handed with all who seek to operate in the coalfields.

If operators are to produce meaningful bids without so many caveats that those bids are based more on hope than on fact, as much information as possible should be available in the data rooms, including details of contracts between British Coal and the power generators. That would seem to me to be fundamental, in view of the dependence of the coal industry on those most important of customers.

Finally, I wish to thank my noble friend Lord Strathclyde for the helpful way in which he dealt with some of the important points that had to be addressed in your Lordships' House and in particular the way in which he was so helpful to me and, I have no doubt, others on the question of liabilities on health and related points. I also wish to say how much I appreciated the contributions of the noble Lord, Lord Morris of Castle Morris. I say to him that I hope that I am not a prospective undertaker.

8.15 p.m.

The Earl of Lytton

My Lords, from these Benches I wish to add my thanks to the Minister for the way in which he has handled the Bill. He is always courteous and has a ready smile. Although I have not had a great deal of direct contact with him over the Bill, I can safety say that he has kept up to his usual high standard of competence in the subject matter and great charm and skill in dealing with inquiries. I thank him for that and I thank the officials in his department for their help.

I also wish to thank the noble Lord, Lord Morris, who has been a staunch ally in many of the areas with which I have been particularly concerned on matters of property ownership and rights. I hope that that bodes well for the future in the sense that property ownership and rights are not something that are confined to the rich and wealthy: they are fundamental to the substructure of the country and its economy. I warmly thank the noble Lord and his colleagues in that knowledge.

I also wish to express my appreciation to the noble Lords, Lord Northbourne and Lord Stanley of Alderley. They both battled away fast and furiously on the Bill, with great effect. I wish the Bill well and hope that the points that have been discussed in considerable detail in this House will be heeded in another place. I am particularly concerned that there is the realisation that the question of liabilities is not to be left solely to the principles of risk management in order to create a risk-averse situation for a particular mercantile objective. There are many matters of risk which properly rest in the public domain because they are the product of the activities that are carried out in the name of society to create the wealth of the nation. That should not be forgotten. To try to compartmentalise or ignore them in some way is a mistake and I hope that those points will be taken on board.

On the question of rights under compulsory rights orders, we have made great progress in this House. I hope that the free market will be allowed to operate under the Bill. It will be a great step forward and will help to defuse some of the essential divisiveness of a compulsory purchase situation, which is always a vexed question. I can say that with some feeling, having acted for both sides—both acquiring authorities and private individuals—over the years.

I should like to pay tribute to certain outside organisations, the Coal Liaison Group and, in particular, the Country Landowners' Association and the National Farmers Union, which have taken a very keen interest in this matter. They have been a tower of strength in the information that they have provided. I wish the Bill well.

Finally, I have an interest to declare that I have not declared previously; namely, that I am a burner of 3½ tonnes of anthracite a year in a coal-fired appliance. I particularly hope therefore that the industry will be leaner, fitter and more competitive in every sense; that the outcome will be a higher quality product which will be the envy of the world; and that we can continue to export the technology to other countries.

Lord Dormand of Easington

My Lords, I thought that the good nature and good humour which have permeated the whole of our debate on this Bill had come to a sudden end tonight because of some remarks that the Minister made. When he made his comments on the remarks that were made by his noble friend Lord Harrowby—I believe I have the name right—he must have known—indeed he did know—that we were very much opposed to this Bill. I repeat that now, although my noble friend Lord Peston has also said so. The Minister then made remarks about me personally when he spoke of unemployment in the North East. But I soon realised that he was teasing us, and we appreciate that.

I should like to add my comments on how co-operative—not all the time but for most of the time —the Minister and his noble friend have been. Above all, we have to express appreciation for the noble Lord's patience. We have raised matters on a number of occasions which he thought that he had dealt with before, and he said so. But in fact he was very patient. Some of us seem to remember when he was not quite so patient. But now we are glad to pay tribute to the way in which he has dealt with this Bill.

The weaknesses of this Bill have been demonstrated time and time again during all the stages of its passage through this House. Its fragility arises from two basic facts. The first is that the Government have not properly thought through the implications of the proposal. We saw that time and time again during our debates. We have seen the Bill stumbling on virtually every aspect: environment; subsidence; CISWO; British Coal Enterprise; liabilities, and other matters. Secondly, the coal industry in this country always meant more than the winning of coal. The Government have never really appreciated that. They have never really appreciated what a pit meant to the community that lived around the pit shaft.

Had the industry been in a parlous state, the Government could have argued for this Bill on economic grounds. In fact, the industry has been a model. My noble friend Lord Morris referred to that fact. There has been a spectacular improvement in productivity. There has been an effective accommodation with imported coal. And the miners have co-operated with management in every reasonable way.

During the passage of this Bill we have not heard a single convincing argument for privatising the coal industry. The Government continue to say that a privately run business is more efficient than one that is publicly owned. But it is sheer dogma to say that that is applicable in every case. It has certainly not been proved in the case of the coal industry.

It is self-evident that the new coal owners will regard some of the present activities, many of which we have discussed during the course of this Bill, as peripheral to the making of profits. It is for that reason that noble Lords on all sides have expressed fears and doubts about safety, research and development, liabilities and many other matters.

After considerable pressure, we have had promises on the problems relating to minewater. Problems were raised on all sides of the House. But few noble Lords are completely convinced that the promises will hold for as long as they will be needed. As the Minister knows— and he was very helpful in regard to my own representations on this matter —I still hold those doubts. All that I can say is that we shall watch the situation very closely indeed in the months to come.

The Government's case on the Bill would have been more convincing had they placed the coal industry and the Bill in the context of an energy policy. Instead, they have considered the industry in isolation, with the review of nuclear power still to come. Such piecemeal treatment serves neither the industry nor the country. It is not surprising that some industrialists have found it difficult to comprehend a policy which has encouraged the expansion of gas, of nuclear power and of French imports, all at the expense of coal—the contraction of coal—which, it is now generally accepted, provides the best value for money.

Throughout our debates concern has been expressed not only about the powers of the Coal Authority but also about how those powers are to be interpreted. I believe that there will be confusion in respect of the work and the functioning of that authority. It is in any case too weak to deal with the problems which will inevitably land on its doorstep—it is weak in powers and resources and perhaps even in expertise.

Finally, I pose a question to which no one can yet have the answer. In spite of the many difficulties and hardships which their work has always given them, miners have always had a deep pride in their industry. That has been shown in their village communities, in their camaraderie down the pit and in their union activities. Much of that has arisen from the fact that for a long time miners were part of a national and co-operative industry and organisation. Under the new conditions based on separatism and competition it may well be that that spirit and pride will disappear, or at least be eroded. It seems inevitable that there will be some change, however small or great, and that cannot be to the benefit of the industry or the economy as a whole.

I hope that the answer to the question that I have posed will be that there will not be any fundamental change. The Labour Party is committed to the reintroduction of public ownership of the coal industry, and it appears that we shall be undertaking that task in two or three years' time. It is important—

Noble Lords

Oh!

Lord Dormand of Easington

I could have said that I do not think there is any doubt about it. But I am a reasonable man. I believe that that will be the case. But my point is that at that time, when it does arrive, it is fundamentally important that there should be high morale among the miners and indeed all the employees within the mining industry.

The future for coal could be very bright, and it will be so. But one of the first tasks of a Labour Government will be to get rid of this inadequate and unimaginative piece of legislation.

On Question, Bill passed, and returned to the Commons with amendments.