Coal (Hansard, 9 May 2000)

§ Mr. Mitchell
To ask the Secretary of State for Trade and Industry if he will list in respect of(a) deep-mined and (b) open-cast coal the tonnages of coal produced in the latest year for which figures are available for each member state of the European Union, together with the amounts of subsidy provided; and if he will list the relevant articles of European Union treaties and relevant regulations or directives relating to limits on non-commercial support for the mining or marketing of coal. [120645]

§ Mrs. Liddell
I have no information on the division between deep-mined coal and opencast coal produced in other member states. Total hard coal production in the EU in 1999 was as followsGermany 44 million tonnes, UK 36 million tonnes (21 million deep-mined and 15 million opencast), Spain 17 million tonnes and France 4.5 million tonnes.
The last year for which figures are available for the amount of subsidy provided is 1997. In that year Germany produced 51 million tonnes with authorised operating aid of ECU 4,919.1 million. The UK produced 47 million tonnes (30.3 million deep-mined and 16.7 million open cast) with no operating aid. Spain produced 17.5 million tonnes with authorised operating aid of ECU 704.5 million. France produced 5 million tonnes of hard coal in 1997, but we have no information on the amount of operating aid paid.
Issues relating to the production of coal are covered by the Treaty establishing the European Coal and Steel Community, which is also known as the Treaty of Paris. State aid is prohibited in general terms by Article 4 of that Treaty but Decision 3632/93/ECSC, which is made under Article 95, permits such aid in the limited circumstances detailed in the Decision which include prior Commission approval.

§ Mr. Gibb
To ask the Secretary of State for Trade and Industry if he will provide an analysis of how the figure for state aid for the coal industry was derived. [120111]

§ Mrs. Liddell
As my right hon. Friend the Secretary of State for Trade and Industry indicated in his statement to the House on 17 April 2000,Official Report, columns 697-99, the Government are exploring with the European Commission how state aid might be offered to help the coal industry through this period of transition. We will also be consulting with interested parties on the precise structure of the state aid scheme to be put to the European Commission.
341W
The amount of aid paid will depend on the outcome of negotiations with the Commission and coal producers as well as market conditions over the next two years. It is too soon to make any detailed analysis of the costs. I have said that I do not rule out a figure as high as £100 million.

§ Mr. Gibb
To ask the Secretary of State for Trade and Industry if he will list the occasions on which he has discussed with the European Commission the potential for state aid to the coal industry. [120114]

§ Mrs. Liddell
I have discussed the potential for state aid to the coal industry with Commissioner de Palacio. Officials in London and Brussels have discussed the issue with the Commission services. My right hon. Friend the Secretary of State for Trade and Industry has discussed the matter with Commissioner Monti.

§ Mr. Gibb
To ask the Secretary of State for Trade and Industry which interested parties he will be consulting regarding the proposed state aid to the coal industry; and by when the consultation process will be completed. [120112]

§ Mrs. Liddell
My officials will discuss the proposed state aid to the coal industry with major coal producers and coal production trade associations, as well as coal users and traders. This informal consultation process will take place during May this year. Any interested parties should contact David Fielder on 020 7215 5593 or write to the Coal Directorate at Room UG23, 1 Victoria Street, London, SW1H 0ET. We will, of course, also be consulting the European Commission prior to submitting a formal notification of aid.

§ Mr. Gibb
To ask the Secretary of State for Trade and Industry when he expects the European Commission to reach a decision on the legality of the proposed state aid to the coal industry. [120113]

§ Mrs. Liddell
The Government will be discussing a proposed state aid scheme for the coal industry with the European Commission and the coal industry over coming weeks. The Commission has three months from the date on which we submit a formal notification of aid in which to reach a decision. As was said to the House on 17 April 2000,Official Report, columns 697-99, we hope to be making the first payments under the scheme during this financial year.