§ Mr. Skeetasked the Secretary of State for Energy what is his attitude to the European Commission's proposals relative to community aid for financing cyclical stocks of hard coal, coal and patent fuel, R 686/77.
§ Mr. EadieI believe that the Commission's proposals are a necessary, albeit minimum, contribution to the stabilisation of Community coal production. Coal demand tends to be cyclical, but coal production is relatively inflexible. So in times of low world coal demand, such as the recent years of recession, coal stocks tend to rise and their maintenance places a heavy burden on coal producers. They may thus be forced to close pits which cannot then readily be reopened. Hence the stocking aid proposals are aimed at assisting Community producers to maintain their production ready for when demand turns up again.
§ Mr. Skeetasked the Secretary of State for Energy what Her Majesty's Government propose to do to stimulate intra-Community trade in coal, R 478/77, and to make United Kingdom coal more competitive with that imported into the 506W EEC from countries outside the community.
§ Mr. EadieThe Government are supporting the proposals put forward by the European Commission to reduce Community dependence on imported energy and to stimulate Community coal production and trade, including the proposal to monitor third country imports in R/478/77. It is expected that Community demand for coal will increase, and, as this is our main market, United Kingdom export opportunities should improve also. The United Kingdom is the cheapest coal producer in the Community and new investment under "Plan for Coal" should strengthen our position. However, in general West European coal is more difficult to mine than that of third country producers.