§ Mr. Harrisasked the Secretary of State for Trade and Industry whether he is in a position to make a statement on the consultants' report on Geevor tin mine.
§ Mr. Giles ShawOn 8 April 1986, immediately after the mine had ceased production and the majority of the workers laid off, Geevor applied for selective financial assistance to fund a large project designed to improve its competitive position. This followed the sharp fall in the tin price after the International Tin Council ceased its operations on the tin market last October. After careful examination of this application, the Department of Trade and Industry met Geevor on 30 April and explained that the project did not put the company into a viable situation. The cost per job of supporting Geevor's project would have been very expensive indeed. To provide time for60W Geevor to prepare a revised application for assistance, the Department made a grant of £40,000, matched with a grant of £40,000 from Cornwall county council to pay for a month's care and maintenance of the mine during May. The company's revised application was rejected on 2 June, because the proposals still did not offer sufficiently robust prospects of commercial viability to justify financial assistance on the scale requested.
After further discussions with Geevor, the Department offered on 2 July to pay for an independend consultation to study whether the mine's production costs could be reduced to a competitive level. The company accepted the Department's offer on 14 August. The Department and Geevor agreed the terms of reference for the consultant's study, the DTI making available technical expertise and Geevor giving full support to the study.
The consultant's report was sent to Geevor on 13 October, when the Department also offered Geevor a joint meeting with the consultants do discuss the report. On 21 October, the chairman of Geevor informed the Department that as the minimum cost of producing tin at Geevor mentioned in the report, is equivalent to a tin price of over £8,200 per tonne he did not consider the matter should be pursued. The Department replied on 23 October saying that the Government accepted his view that the consultant's report did not provide the basis on which a viable plan for developing Geevor could be put forward. Accordingly, the Department informed the company, with regret, that financial assistance could not therefore be made available to Geevor, since viability is one of the essential requirements for providing selective financial assistance under the Industrial Development Act 1982.