§ Mr. Michael Lathamasked the Secretary of State for Energy what is the approved level of expenditure on new projects by the NCB over the next five 585W years; what is the approved sum for opening up the new Selby mine; what financial return is anticipated on that investment, based on normal accounting procedures; and over what period it is anticipated that the investment will be: (a) spread and (b) recovered.
§ Mr. EadieThe Government's White Paper, Public Expenditure to 1979–80, Cmnd. 6393, set out forecasts of the NCB's capital expenditure:
£ million at 1975 Survey prices 1975–76 … … … 188.5 1976–77 … … … 219.3 1977–78 … … … 242.1 1978–79 … … … 242.0 1979–80 … … … 241.0 Revised forecasts are being considered in the present review of public expenditure.
The estimated expenditure on the fixed assets of the new Selby mine is about £400 million at March 1976 price levels. The estimated return on the investment is well in excess of the test discount rate of 10 per cent. per year, in real terms. Expenditure is expected to be spread over a period of 12 years and should be recovered, in discounted terms, within a few years of the end of that period.