Orders of the Day — Coal Industry Bill

Part of the debate – in the House of Commons at 12:00 am on 3 December 1970.

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Photo of Mr John Eden Mr John Eden , Bournemouth West 12:00, 3 December 1970

I beg to move, That the Bill be now read a Second time.

Since its publication, public comment on this Bill has in the main concentrated on Clauses 6, 7 and 8—the Clauses concerned with the non-colliery activities of the National Coal Board. I have no doubt at all that the anxiety which has been expressed to me by some hon. Members opposite is absolutely genuine, but I can at the outset assure them and the House that there is no justification for the wildly speculative interpretations which in some quarters have been put on these Clauses.

The Coal Board has moved a long way since it was created in 1946. It is now engaged in a wide range of non-mining activities. Some of them—like brickworks, coal-sale depots, coke ovens, farms and housing—were carried on by the privately-owned collieries before nationalisation and were included among the assets vested in the Board by the 1946 Act. But since then diversification has increased, so that the activities now include processed fuels manufacture, builders' merchants, district heating, retail coal distribution, chemicals, North Sea Gas and hotel reservations. Some of these are in the form of wholly-owned ancillaries carried on by the Board; others are wholly or partly owned trade undertakings which include partnerships and equity participation in private sector companies. Between them they made a net contribution last year of some £15 million to the Board's profit before interest. This more than off-set the operating loss on colliery account.

In developing its non-colliery activities the Coal Board has been acting within the wide powers conferred on it by Section 1 of the 1946 Act. From what I have said it is evident that these activities are now of considerable significance to the management and finances of the Coal Board. They are also, therefore, of major interest to Government and to this House. Over the years, the coal industry has gradually spread further away from its original base, and in the interests of proper accountability Parliament should know where this process has got to. We need to be informed about the strategic plans of one of our major public sector industries, and we should know the extent to which the large investment of taxpayers' money in coal is being buttressed by or even extending into diversified activities.

The first step in this process should be taken in connection with the Board's published accounts. A great deal of information is already given, but in order that legitimate public interest may be satisfied and to demonstrate the extent, if any, to which cross-subsidisation occurs, the state of affairs of the Board's subsidiaries should also be disclosed in as full and comprehensive a manner as possible. Clause 8 would give powers to ensure that this was done.

Clause 6 provides for a review of all or any of these activities to show the extent to which they draw upon the resources of the Board, the benefits they bring, and the way they fit into the Board's plans for the future. Since it is nearly a quarter of a century after nationalisation, it is absolutely right that we should now take stock of the point that has been reached. No decision has been taken by the Government concerning any of these activities. We want to be able to judge the position of each against a proper assessment of their value in the interests of both the Coal Board and the taxpayer. It is only in that way that my right hon. Friend will be able to satisfy himself as to whether or not the activities concerned should be retained for the effective discharge of the Board's duties. Only then, after full consultation with the Chairman of the Board, will he be in a position to use the powers provided for in Clause 7.