Orders of the Day — Coal Industry

– in the House of Commons at 12:00 am on 20th March 1972.

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6.43 p.m.

Photo of Mr Willie Hamilton Mr Willie Hamilton , Fife West

I take this opportunity to call attention to the Supplementary Estimate for £100 million which is provided in connection with the future of the coal industry. This gives the House an opportunity for yet another debate on the future of this nationalised industry and the Government's attitude to publicly-owned industries.

The sum of £100 million referred to in this Supplementary Estimate represents only part of the cost of the Government's crass mishandling of the coal mining dispute. The Government thought that they could teach the miners a similar lesson to the one meted out to Post Office workers a year ago. They sought to impose their unofficial 8 per cent. norm on the public sector while standing helplessly by watching much higher pay awards in the private sector.

People like the nurses had to succumb without a fight, as did others in the weaker sections of the public sector, and the Government misunderstood, either through ignorance or malice or a combination of both, the determination of the miners, with the whole Labour Movement behind them, in their fight, as they and as we saw it, not against the National Coal Board but against the Government.

The Government miscalculated the enormous public support which the miners elicited and maintained, despite the inconvenience and hardship caused by the strike. The Tory Party, including the Prime Minister, tried to alienate that public sympathy by blowing up, out of all proportion to the immense scale of the operation, isolated cases of illegal picketing and the occasional rare use of physical violence, which none of my hon. Friends condones and which the provisions of the Industrial Relations Act re- lating to picketing were designed to prevent.

The strike was the culmination of a long period of restrained frustration felt throughout the mining community, which had taken a lot on the chin from Governments of both political persuasions. I fully accept that the Labour Government were in part to blame for the frustration felt by the miners over the years.

The massive rundown of total manpower in the last decade or so, achieved with the minimum of industrial friction, represented a more peaceful revolution than any other country could have aspired to, but the material rewards for the miner for that achievement were very meagre indeed. I need not spell out the details. They were presented to the N.C.B. and the Government and finally accepted by the Government only after the Wilberforce Committee had sat for a few days.

The Guardian carried an article on 4th February by John Torode, which said: Take a surface worker with two children. His current rate is £18 a week. Deduct income tax, national insurance, pension and union dues. He takes home £16·42. The offer would give him £20. Take away the bigger tax and national insurance contributions plus pension and union dues. He would take home £17·74. This is an increase of £1·32 or 8 per cent. The previous deal came into effect in November, 1970. The present settlement will be back-dated to November, 1971. In that period the cost of living index rose by 10 per cent. To make good that loss he would need an increase of 10 per cent, in take home pay, and that works out at £1·64–32p less than he has been offered. It goes on to show how, taking into account all the means-tested benefits that they would lose in very many instances, and not only among the lower-paid, miners would be worse off in money terms and considerably worse off in real terms compared with what they had as a result of the previous offer.

Despite those facts—they must have been known to the Government; they were known to the N.C.B., although the board was helpless in the circumstances—on the Wednesday before he went on television, when addressing the Engineering Employers Federation about the strike, according to a report in theFinancial Times: Mr. Heath forcefully argued that the lesson of recent events was that it was far better to achieve results by agreements and negotiation rather than put them at risk by dispute, confrontation and even violence. In a direct criticism of the miners, he added, to loud applause: he would get loud applause from the employers— 'It cannot be a sensible or a responsible decision for one section of the community or its leaders, to endanger the life and livelihood of 50 million of their fellow citizens'. When he made his subsequent broadcast, on 27th February, the Prime Minister went to even greater lengths of exaggeration and distortion of the facts, and was loudly criticised for that appearance on television by virtually all the public media. I need not quote them all. I shall quote just the Spectator, which is part of my regular reading these days. I quote one or two extracts from the issue of 4th March: The Prime Minister's televised address to the nation last Sunday was a poor piece of workmanship. It was sloppy and shoddy, at times disingenuous and, on occasion, mendacious. The hon. Member for Worcestershire, South (Sir G. Nabarro) was even more forthright and colourful in his language—not about that appearance but about his Prime Minister in general; but it is not worth wasting the time of the House quoting him.

Photo of Sir Gerald Nabarro Sir Gerald Nabarro , Worcestershire South

It would be wasting time, because my observations on the quality of the Prime Minister's leadership were in no way related to the coal strike. They did not follow the coal strike. I castigated my right hon. Friend the Prime Minister for blacking out my television set at Broadway, Worcestershire, two minutes before he was due on the screen.

Photo of Mr Willie Hamilton Mr Willie Hamilton , Fife West

It was a general criticism of the ineptitude, not the dishonesty, of the Prime Minister. I accept that it was a much wider criticism than his dealings with the miners' strike.

The brutal truth is that the Tory Party in general has never understood, liked or sympathised with the mining community. There are no votes for them in the mining areas. There are no miners at Tory Party conferences. So we saw the thinly masked malice in the speeches made by Tories in the coal industry debate in the House on 10th March. The hon. Member for Torquay (Sir F. Bennett)—who is not in the Chamber—urged then, in what he presumed was a reasoned Amendment to the original Motion by one of his hon. Friends, that the industry should be run down much more quickly than it had been hitherto. He was on the same line at Question Time today, saying that it was dangerous and difficult work, and so on

We know that the noises that hon. Members opposite make here are very different from the noises they make in their private committee rooms about the mining industry. The hon. Member for Birmingham, Perry Barr (Mr. Kinsey) called the Wilberforce settlement "a blueprint for disaster". Other hon. Members were baying for the Government to starve these strikers into submission, coal-miners in particular, and their families, by withdrawing social security benefits. The hon. Member for South Angus (Mr. Bruce-Gardyne) has done this strongly for months on end, not only about the miners but about every section of the community which exercises its inalienable right to withdraw its labour if there is no other way of getting what it ought to get.

The Prime Minister sought to imply that the miners had won by display of violence—almost associating the miners with the I.R.A.—against law and order, getting what they thought they should get and what the Prime Minister thought, by implication they ought not to get, by rebelling against law and order and against the overall national interest.

But all that is past history. We now have the future to face—and the bills. Large questions remain unanswered. When the Secretary of State for Trade and Industry made his statement on 6th March—on which the Supplementary Estimate is based on—the new financial structure which the Coal Board will have to face as a consequence of Wilberforce, he indicated that the Government were making a profound study of the various problems arising. Reading the OFFICIAL REPORT for that day, one finds that he talked about the impact on coal consumption, the impact on employment in the industry, the effect on the regions, the desriability of a national fuel policy, the impact on the coal industry, and so on.

I take the view—I speak only for myself—that it would be wholly unreasonable and unrealistic for us to expect definitive answers to any of those questions today, or for a considerable time. However, what we should be told farily quickly is what the Government intend to do about the capital restructuring of the industry. The Government clearly must have been working on that for a considerable time, and it is very important that we should have some very quick answers on the subject. We are also entitled to a firm reassurance that for a long time to come the coal industry will—indeed, must—remain the main source of our total energy requirements.

On the regional question, I was interested to note that the Prime Minister, in his exchanges with M. Pompidou over the weekend, stressed the importance of adequate Community financing of a regional policy. As has been stated in the House time and again, the United Kingdom's coal industry is primarily in development areas—Scotland, the North-East and South Wales. I quote one or two figures to show the rundown of the coal mining industry in Scotland. The figures are not strictly comparable, but enough to suffice. In 1955, the number employed in mining and quarrying in Scotland was 100,800. In mid-1970, in mining alone, the figure was 40,000. One could say that, in effect, the figure has dropped in 15 years from 100,000 to 40,000, predominantly male jobs.

Therefore, the assurances for which I have asked are required the more so as we on this side of the House are well aware of the enormous pressures on the Government by industry and by their backbenchers to teach the miners a lesson for daring to challenge the principles on which the Government have been seeking to run their battle against inflation. They—particularly the back benchers—are still smarting after the recent comprehensive collapse of their economic policies, brought about in no small measure by events at Upper Clyde Shipbuilders and in the coal industry. They are putting tremendous pressure on the Government to get rid of or, at least, minimise industry's dependence on coal as its main energy-supplying fuel as quickly as possible. Tomorrow we may see the first indication that those back benchers have drawn blood; that is to say, tomorrow the Chancellor might say, "We will now reduce or abolish the tax on fuel oil".

Photo of Mr Willie Hamilton Mr Willie Hamilton , Fife West

The total revenue from that is approximately £120 million. That concession would be—indeed, must be—the small change of the Chancellor of the Exchequer's largesse which the whole nation is expecting. He will not be doing what he is doing tomorrow because of the goodness of his heart but because of a million on the dole, brought about directly by his Government. He must get people to spend more and the only way he can do that is by putting money in their pockets, and to that end he will probably give £1,000 million away tomorrow.

A reduction in the fuel oil tax would not be welcomed by hon. Members who represent mining constituencies, although my constituency is not so dependent upon the mining industry as it used to be. In our view it would be extremely foolish and short-sighted to increase our dependence on foreign imported oil—especially Middle East oil—when the price of these imports is already increasing substantially and will continue to do so over the next few years. All other fuels are problematical as to costs and quantity, as the Under-Secretary said in the debate on 10th March. North sea gas and oil are unknown factors. The hon. Gentleman said that there were only 20 years of known reserves of natural gas, and that would supply about 15 per cent. of our—

Photo of Hon. Nicholas Ridley Hon. Nicholas Ridley , Cirencester and Tewkesbury

What I think I said was that at the peak of supply it appeared that there would be about 20 years supply. After that, the amount of take would decline unless more discoveries were made.

Photo of Mr Willie Hamilton Mr Willie Hamilton , Fife West

I am sorry. I did not want to misunderstand or distort what the Under-Secretary said. He was implying that he did not know how much gas we would get from the North Sea and how many years it would last. That is the point that I am making. The same applies to oil from the North Sea. It would be the height of foolishness and short-sightedness to rely more and more on those fuels and less and less on the certain supply of indigenous fuels like coal. In addition to that, there is the impact on employment prospects because the coal industry is labour-intensive and the others are not—but I need not go further into that.

I wish to say a similar word about nuclear power. It is undeniably a big disappointment, The forecasts that have been made seem to have erred on the side of optimism. It currently supplies only 3 per cent. of our total energy requirements and, as the Under Secretary said in the debate, Dungeness B station is four years behind schedule, and the cost is more than double the original estimate. The fast reactors are not expected before the 1980s. On natural gas from the North Sea, oil—particularly imported oil—and nuclear power, there are so many imponderables. We do not know how much we will get, how long it will last and what it will cost. For all these reasons the Government are probably wise not to attempt to publish even the most sketchy outline of future trends of total energy requirements or their distribution as between coal and other fuels.

I wish to refer to the implications of the Supplementary Estimate. My hon. Friend the Member for Pontefract (Mr. Harper), in an exchange after the Minister's statement a few weeks ago, referred to the treatment of redundant miners. The mining industry, in terms of human sacrifice and danger, compares very unfavourably even with the military forces. I can never understand why we choose to treat a miner who has served 50 years in a coal mine infinitely less generously than someone who served the same period in the Armed Forces. The Serviceman is at risk only when we are at war, or if he is sent to Ulster, but the miner faces a risk every day he goes down the pit.

The Government are laying great stress on the need for the extension of occupational pension schemes. The miners have an occupational pension scheme, but it is not worth the paper it is written on, and the people who negotiated it should be ashamed of themselves. [Interruption.] The hon. Member for St. Ives (Mr. Nott) represents a mining constituency, and I should think he knows all about this.

Photo of Mr Willie Hamilton Mr Willie Hamilton , Fife West

I know, but it is not coal. Those who negotiated the scheme ought to be ashamed of themselves—and I hope that the Government will exercise what influence they have to improve matters. They clearly had influence in the wage negotiations before Wilberforce, and if they can seek to adversely affect the miners they can exercise a similar influence to provide a much more generous occupational pension scheme for these men. The miner now can retire after 40 years in the pit and be paid 30s. a week, and if he is on supplementary benefit 10s. of that will be deducted. That is an outrage against men who have spent so many years in one of the most dangerous industries, if not the most dangerous industry.

Paragraph 54 of the Wilberforce Report recommended that pension provision and redundancy payments should be reviewed. I hope that the Government will examine what is being done for the dockers and the railway men who are being encouraged to leave the industry by what, in terms of what they used not to get, are massive sums. Currently the dockers are being offered £2,000 each to get out of the industry. As far as I know, no miner has been offered that. If the industry is to be run down over the next few years we hope that it will be at a much slower rate than in the last ten years. The Government and the Coal Board together should offer £10,000 to a miner who wishes to retire at 50. That would do a good deal to soften such blows that might be aimed at the coalmining industry.

Photo of Mr Joseph Harper Mr Joseph Harper , Pontefract

Would my hon. Friend consider making that provision retrospective?

Photo of Mr Willie Hamilton Mr Willie Hamilton , Fife West

My hon. Friend is doing not too badly as he is, but if he can persuade the Government to make it retrospective the least of opposition would come from me.

An obligation was placed on the Coal Board under the terms of the 1961 White Paper on the Financial and Economic Obligations of Nationalised Industries, Cmnd. 1337. In paragraph 60 Wilberforce says that the White Paper requires surpluses to be sufficient to cover deficits on revenue account over a period of five years". Wilberforce went on to point out that since the early 1960s, ever since the White Paper was produced and the statutory obligation was laid on it, the Coal Board has never been able to meet the objectives set by the Government, because it was unrealistic to expect it to do so. I hope that the Government will now think it appropriate to enforce, if enforce they must, much more realistic obligations on the board.

We all understand the need to combat inflation, which is the enemy of everyone—not least the groups on small fixed incomes. But it is wrong and unacceptable to lay the burden for the solution of this problem on people like coalminers. They are a very special case. They were so regarded by Wilberforce and public opinion. Unless and until the Government pursue policies which are socially fair and economically wise they will not receive co-operation from organised labour like the miners and members of other unions. They will not receive the kind of co-operation that we all so much need if we are to get on top of the problem.

When the Government castigate us for supporting the miners, I remind them that we supported the miners just as, before the General Election, the Tory Opposition supported the claim of the doctors for a 30 per cent. increase when we were fighting the same battle as they are fighting now against inflation. That did not deter them from saying that the doctors should have a 30 per cent. increase. The miners' increase has been fully justified by Wilberforce, and it was fully supported by public opinion throughout the weeks of hardship. We can see the great difficulties that all Governments face in the battle against inflation.

If, tomorrow, the Chancellor of the Exchequer does not induce the feeling in the country that there is social fairness and equity among the various sections of the community, no matter how much cash he gives away in tax concessions he will be condemned, because until there is a belief among ordinary working people that the Government are imbued with a sense of social equity and fairness we shall not get on top of the seemingly intractable problem of inflation, with higher costs and reduced standards of living.

7.12 p.m.

Photo of Sir Gerald Nabarro Sir Gerald Nabarro , Worcestershire South

I address myself to the Supplementary Estimate of £100 million. Last year, addressing the annual luncheon of the Institute of Fuel, I asked the top body of fuel and power technologists in Britain whether it was possible for any managing director to run a company effectively and efficiently if he knew that the duration of his office would be one year. Since the end of the war, approximately since the date of nationalisation, there have been 24 consecutive Ministers, of the two main parties, responsible for the coal industry. Their average occupancy of office is one year, and that is why the industry today is rudderless, without ministerial direction and with a Minister purporting to be in charge who refuses to publish his forward plans.

I shall not address myself to the causes of the coal mining strike, but only to the consequences and why the £100 million has become necessary, and why I object to the method of financing the losses and what should have been done, though because the debate is on the Consolidated Fund Bill I cannot vote against it. It is part of a compendium of measures, and therefore I can only vocally protest about the arrangements.

Of course, we all know that 50 per cent. of the output of coal in this country today goes to electricity power stations. Of course, we know that coals of a high ash content which cannot be burnt elsewhere can be burnt under power station boilers. Of course, we know that coal-fired power stations are highly economic and satisfactory if they are correctly sited. Of course, we know that marginally oil is cheaper than coal today as a source of energy for power stations. Of course, we know that nuclear energy is a trifle more expensive than coal or oil. These are all established facts.

What I object to most is that a power station must be planned seven years ahead, and there are no coal-fired power stations in course of construction in Britain today. So the first new coal-fired power station could not be brought into use until almost 1980 if it were ordered now. I question, therefore, how it is possible for the size of the coal industry to be determined by the managers within the industry, the National Coal Board, unless some direction is given and decisions are arrived at by the Government as to the type of fuel to be employed in the next generation of power stations in Britain. That is the first consideration to which we should be addressing ourselves in this debate.

The Minister responsible, my hon. Friend the Secretary of State for Trade and Industry, resolutely refuses to state what will be the pattern of power generation and the type of fuel employed during the next 10 years. This is likely to lead to heavy losses in the future. I do not take the view of the hon. Member for Fife, West (Mr. William Hamilton) that the Government should not try to plan energy requirements ahead, nor do the coal-mining representatives in the Opposition take that view. They want what I want, which is a determination of the type of fuel to be employed in order that the coal industry may effectively plan its proper and economic size.

The size of the industry today is about an output of 140 million tons, of which about 70 million go to power stations. I shall not quibble about 1 million tons of coal one way or the other. The industry, with its 285,000 men employed, is going through a period of acute uncertainty. No engineering apprentice is likely to go into the coal industry for a career today, for he has no notion whatever of what will be ahead of him in 10, 15 or 20 years when he grows to maturity. No man may seek to rise in the coal industry and achieve executive or managerial capacity, 10, 15 or 20 years ahead because he has no knowledge whether coal will be entirely supplanted by oil or natural gas, or whether we shall have a coal industry in the form we have today. None of these facts is made known by the Government, who are responsible for the direction of the industry.

Last Friday I was delivered a large wadge of documents about North Sea oil and gas prospects during the next 30 years. Broadly, we were told that 75 per cent. of our oil requirements, based on today's consumption, might be derived from North Sea sources. But the requirement will undoubtedly grow a great deal within the next30 years. On top of that, there is the prospect of large quantities of natural gas. We do not know what will be the out-turn, as we cannot measure it effectively over the next 30 years ahead. We do not know what the price and cost of extraction will be during the next 30 years. We do not know whether many of the plots allotted to major oil and associated companies will be fruitful or otherwise.

It is a huge gamble as to what will come out of this major discovery. But I fervently believe two sayings which have been implanted in my mind. The first is that of my right hon. Friend the Minister for Transport Industries during our years in opposition that this was the first piece of real luck Britain had had since the end of the war. I endorse that. The second was by Sir Henry Jones, when he said that the fields in the North Sea were of Texan dimensions.

All of this must have a profound effect on the future of the coal industry. It is futile to say that we can rely entirely on oil and gas from the North Sea or entirely on coal. It will have to be an admixture of the three fuels in order to succeed. I am anxious that the Government should state definitively how much of the market they propose to reserve for coal. The coal industry must be made effectively to compete with North Sea oil and gas, and can indeed do so, for most of our major consumption requirements.

The hon. Gentleman talked disparagingly of my Conservative colleagues and myself in the context of tomorrow's Budget. It was the present Speaker of the House of Commons who, when Chancellor of the Exchequer, put on the fuel oil duty. I was the first to protest clamantly about the distortion of the competitive forces in fuel and power. So strongly did I feel in 1961 that I took 23 of my colleagues into the "No" Lobby against the Government, as I would do again today if the same circumstances arose, because subsiding coal by placing a duty on fuel oil distorts the competitive forces of both fuels and is wholly injurious. When Mr. Speaker put on that duty, he said that it was for revenue purposes alone. But the following year, when my right hon. Friend the present Home Secretary became Chancellor of the Exchequer—in 1962—I pressed him so hard during the year, and so explained my dissatisfaction with the arrangements, that he confessed that it was not for revenue reasons at all but a measure of protection for the coal industry, which I regarded as wholly erroneous and wrong.

Photo of Mr Joseph Harper Mr Joseph Harper , Pontefract

When the present Speaker put 2d. a gallon tax on oil, on 17thApril, 1961, he said quite definitely that is was for revenue purposes only.

Photo of Sir Gerald Nabarro Sir Gerald Nabarro , Worcestershire South

Yes, and the following year my right hon. Friend the present Home Secretary, who had succeeded him as Chancellor, stood the whole matter on its head and said that it was not for revenue purposes but to protect the coal industry. He was decidely more honest than his predecessor in this context. [HON. MEMBERS: "Oh."] I have said it before. As it is all more than 10 years ago, it is ancient history.

The most effective contribution to stabilising prices which my right hon. Friend the Chancellor of the Exchequer could make tomorrow would be to abolish fuel oil duty and remove the protection for the coal industry. The duty collects £135 million, so its removal would be a very important contribution indeed to stabilising prices when one considers that the electricity generating industry alone pays tens of millions of £s in fuel oil duty and that about 15 per cent. of all energy requirements in Britain are furnished from oil sources.

Photo of Mr Eric Varley Mr Eric Varley , Chesterfield

The hon. Gentleman will recognise that the heavy oil duty not only helps coal but natural gas and nuclear power.

Photo of Sir Gerald Nabarro Sir Gerald Nabarro , Worcestershire South

Of course, it helps all of them—I agree. What I want to do, if we are to continue to subsidise the coal industry so heavily, is to make it compete on equal terms with other sources of energy. I thoroughly object to this Supplementary Estimate of £100 million and the Government's chosen method of financing the losses arising from the recent miners' strike. I will relate briefly how the Government have financed the losses.

First, the Government allowed the price of coal to rise by about 50p per ton, which is of the order of 7½ per cent. on the price of coal, thus breaking their solemn bond and undertaking to the C.B.I. to limit the advance in prices of nationalised industries to 5 per cent. It is now 5 per cent. plus 50 per cent., equals 7½ per cent., and that is a much larger figure than that contained in the undertaking given to the C.B.I.

Secondly, as a result of that increase in price of 50p per ton, £60 million is to be recovered from the market out of the £90 million which the miners' award will approximately cost. So, £60 million is to come from the market and £30 million from Government subsidy, inherent in this figure in the Supplementary Estimate of £100 million; the other £70 million is additional working capital for the National Coal Board on account of the losses during the strike.

Had I had this agonising decision to make, I would have put the whole £90 million on the price. I would then have abolished the fuel oil duty and would have let these two basic fuels, both indigenous, compete freely one with the other. What have we got today? The rout as I call it, of Government policy for prices and incomes. The Government stand utterly defeated.

Everyone knows the Daily Telegraph man. He has a bowler hat, a rolled umbrella—

Photo of Sir Gerald Nabarro Sir Gerald Nabarro , Worcestershire South

The Daily Telegraph man has no moustache. I read it only as a last resort.

Photo of Sir Gerald Nabarro Sir Gerald Nabarro , Worcestershire South

The Morning Star, so I know what the Opposition are going to say to me before they say it.

The characteristics of Daily Telegraph man are well known—bowler hat, rolled umbrella—and his bête noire is the National Coal Board and the other nationalised industries. But he is a Conservative, is Daily Telegraph man, and thus, a couple of days after the miners' strike ended, I was deeply grieved, as Daily Telegraph man is a member of my party, to see—

Photo of Mr Joseph Harper Mr Joseph Harper , Pontefract

That he had shot himself?

Photo of Sir Gerald Nabarro Sir Gerald Nabarro , Worcestershire South

He had not shot himself but almost the same thing. On the leading feature article on the centre page of the Daily Telegraph, written by Mr. Paul Einzig, there was the heading, "The Economic Men of Munich".

Photo of Mr Joseph Harper Mr Joseph Harper , Pontefract

Only Paul could write that.

Photo of Sir Gerald Nabarro Sir Gerald Nabarro , Worcestershire South

But he was right. "Men of Munich" is a term which has a very special ring and connotation. We all know what it means. It means, running away; acknowledging defeat. It means £35 million for U.C.S. It means all the reversals of the "lame duck" policies. Whether in the private sector or in the public sector, all "lame ducks" are now to be succoured by Her Majesty's Government.

Photo of Sir Gerald Nabarro Sir Gerald Nabarro , Worcestershire South

I am not sure whether they are flying or whether ducks normally fly, especially lame ones. But in this case, the outcome of the miners' strike and the outcome of the controversy about U.C.S. clearly denote not a change of direction in Government policy but exactly what I have described—a complete rout of the Government's policy for prices and incomes. We have to get out of this.

I cannot vote against the £100 million because it is part of the Consolidated Fund Bill, but I use this opportunity to proclaim my objections to this method of re-financing the National Coal Board. The whole of the miners' strike losses should have gone on the price of coal and the fuel oil duty should be abolished tomorrow. Then fuel oil—and natural gas as a corollary—and coal would have been able effectively to compete one with the other on equal terms. I am sorry that my hon. Friend has decided on the course which he has now adopted. I hope that we will not be confronted in the remaining years of Conservative Government with endless subsidies for nationalised industry, because this is what this £100 million amounts to—a subsidy for the Coal Board and it might as well be recognised as such.

It has already led to leading Opposition spokesmen, the right hon. Member for Manchester, Cheetham (Mr. Harold Lever) for instance, proclaiming that the coal industry must be aided by abolition of all interest charges on its capital. That would be another subsidy. My hon. and right hon. Friends when in opposition did not say any of this. They promised no subsidies for nationalised industries. They promised to cause nationalised industries to conduct their affairs on a strictly commercial basis, not as a social welfare service. Now they are doing exactly the opposite. I shall not in future support or vote for any subsidy for any nationalised industry.

Photo of Mr Michael McGuire Mr Michael McGuire , Ince

What is puzzling me about the hon. Gentleman is that he seems only to be against subsidies for nationalised industries. Is he against the principle of subsidy generally? Why is he selective?

Photo of Mr Joseph Harper Mr Joseph Harper , Pontefract

What about the farmers?

Photo of Sir Gerald Nabarro Sir Gerald Nabarro , Worcestershire South

I have to be selective in these matters. I cannot argue farming subsidies now. We are to end farming subsidies as part of the Common Market common agricultural policy. I am against all industrial subsidies, whether in the nationalised or private sector. That was the policy of my party when we sat in opposition and, so far as I am aware, there has never been any general consent from members of the Conservative Party to change that policy—until these special cases came along involving £100 million for the Coal Board and £35 million for U.C.S.

I am grateful to the hon. Member for Fife, West for providing this parliamentary opportunity to express a Conservative view on the derangement of the Coal Board's finances and the utter inadequacy of a policy of subsidies by the central Government to prop up an industry which I believe should be caused effectively to compete with oil and other sources of energy.

Photo of Mr Peter Rees Mr Peter Rees , Dover

My hon. Friend said that the whole of the consequences of the miners' strike should have been faced by an increase in the price of coal. Earlier he said that the proposed increases of 7 per cent. were a breach of the contract between the Government and the C.B.I. Would he tell us how he reconciles those positions?

Photo of Sir Gerald Nabarro Sir Gerald Nabarro , Worcestershire South

We have to face the fact that the C.B.I. initiative has been busted. It cannot be renegotiated, whether in terms of railway fares, coal charges, electricity or anything else. It has been busted by this Government's decision to subsidise the coal industry by £100 million and to allow prices to rise by 7½ per cent. Thus I say we have the worst of all worlds. It would have been far better to put the lot on the price and free us from the fuel oil duty, which would have allowed effective competition.

7.35 p.m.

Photo of Mr Alexander Eadie Mr Alexander Eadie , Midlothian

I, too, welcome this opportunity to speak on the Supplementary Estimate. The hon. Member for Worcestershire, South (Sir G. Nabarro) said that he welcomed the opportunity to put a Conservative point of view. I wonder whether hon. Gentlemen opposite realise the damage they have done by condemnation of the miners and of Wilberforce. The miners were condemned because they were not prepared to consider arbitration; they were being difficult. The Government set up Wilberforce which made a pronouncement favourable to the miners. If hon. Gentlemen carry on with this hymn of hate against the miners they will do great damage to the industry.

It will be impossible to have rational discussions about wage settlements if it is thought that the Government are concerned only about tribunals and arbitrations which make findings favourable to them. The whole of industrial relations will go by the board, and in this sense the Government are doing a great disservice to industry and industrial relations. If they persist there is not a single worker who will have any faith in them.

There has been an attack on violence during the strike. There were some incidents then with which some of us would not wish to be associated, but we have to remember that there were over 280,000 miners on strike. An article in the Sunday Times exploded this myth of violence. In the latter part of the 19th century, during a miners' dispute, 80 people were arrested and three killed. Nothing like that happened during this strike. If hon. Gentlemen opposite try to hang their hat on the peg of violence they are on a very thin wicket.

The biggest picket took place at this House when I and some of my hon. Friends took part. It was a new thing in the sense that miners' wives took part. The miners were angry and they thought they had a claim. The police at Tower Hill told us that there were 14,000 in that demonstration. What was the violence? One person arrested. Even the Conservative Party could not lobby this House and do better than that.

The hon. Member for Worcestershire, South mentioned the Daily Telegraph and, in an aside, the Morning Star. I must comment on this. We had a lot of interesting comments from the Daily Telegraph during the dispute. Some insulting things were said about the intelligence of the miners and their leaders. There was talk about stupidity. There were even some snide comments about miners' representatives in this House.

Honourable Gentlemen opposite and people who write in the Daily Telegraph believe that the acid test of industry is efficiency, and that anyone who is not efficient should be sacked. On the evidence of what the Daily Telegraph wrote about the miners' strike the staff of the Daily Telegraph should all be sacked. I am not a regular reader of the Morning Star but that newspaper was "spot on" in its diagnosis of the strike and reported it much more efficiently than did the Daily Telegraph. The hon. Member for Worcestershire, South must agree that the staff of the Morning Star should be promoted and the staff of the Daily Telegraph sacked.

Photo of Sir Gerald Nabarro Sir Gerald Nabarro , Worcestershire South

The hon. Gentleman misses the point. I read the Morning Star to ascertain in advance what will be the arguments used against me by Socialist Members of Parliament.

Photo of Mr Alexander Eadie Mr Alexander Eadie , Midlothian

If the hon. Member for Worcestershire, South had read the Morning Star during the miners' strike as diligently as he suggests he would have been more accurate in his diagnosis than he has been in debates in the House.

The conversion of coal-fired power stations to alternative forms of fuel has been suggested. One hon. Gentleman had the temerity to ask the Minister to consider converting coal-fired stations to nuclear-powered stations, which is an impossibility. This illustrates the depth of knowledge of some hon. Gentlemen.

Photo of Mr Alexander Eadie Mr Alexander Eadie , Midlothian

The hon. Member for Worcestershire, South is an exception. There are not many hon. Members who have as much knowledge of this subject as he has.

What has happened to the Chapman Pincher Report, which broke during the miners' strike? I appreciate that it would have been inopportune during the miners' strike for the Government to say that in discussing energy requirements they had discovered that all previous Governments had made a miscalculation about the future of coal, and that coal had a bigger part to play than was thought. But this story was headlined as a Cabinet leak and the Minister must tell us about it at some time. How did the Government arrive at this decision? Was it done through the "think tank", and what are the facts and figures?

The hon. Member for Worcestershire, South spoke of the £135 million fuel oil tax and of standing things on their head. But he is doing the same thing. The £135 million fuel tax is not a subsidy to the mining industry; the Chancellor of the Exchequer gets the money. The hon. Gentleman appealed to the Chancellor to do away with the fuel oil tax, but one does not have to be an economist to realise that if the Chancellor does away with £135 million revenue tomorrow that money will have to come from somewhere else.

Photo of Mr Robert Brown Mr Robert Brown , Newcastle upon Tyne West

I am sure my hon. Friend will appreciate that the Chancellor of the Exchequer has already earmarked an alternative source for a good part of that £135 million. If he phases out the fuel tax he will replace the revenue from that by the profits made by increasing rents under the Housing Finance Bill.

Photo of Mr Alexander Eadie Mr Alexander Eadie , Midlothian

That will be a matter for the Chancellor. He is in purdah; the whole nation is awaiting tomorrow with bated breath. I hope that the Chancellor will be a bit soft-hearted on council rents.

We on this side of the House who have associations with the coal mining industry welcome the oil finds in the North Sea. We are glad that this country has an indigenous source of oil, but nobody in his right mind will suggest that this oil will be cheap. It will be costly, but even so the nation requires the oil. I hope that we shall be able to meet 100 per cent. of our oil requirements from indigenous sources by 1980.

The Minister must squarely face the strategic problems not only in the Middle East but in the North Sea. Oil pipelines are easy to sever. We are an island, and vulnerable and strategic considerations apply. We know that the world is using more oil than it is finding. All fossil fuels are wasting assets and we of this generation must carefully consider and plan our energy resources.

In the matter of energy requirements we have a responsibility to future generations. Nuclear power may well come more to the fore, but this will happen in the 1980s rather than in this decade. It can be said with truth that if we apply the same sort of cost argument to the mining industry as we apply to nuclear power, then nuclear power has been an expensive failure.

I hope that the Minister would consider these various factors. It may be that the world will have a requirement for oil in terms of the growing of food, a great deal of important scientific work has been done in this respect. Therefore, we cannot afford to look at the problems of energy and the use of fossil fuels in a narrow sense, but rather we should consider them in a global sense.

I also hope that the Minister will say how he proposes to implement the Wilber-force recommendations in making proper provision for miners' pensions. We shall not accept the argument that the right way to solve the problem is by introducing retirement at 60 without proper recompense for the person concerned. If miners are to be retired early without proper financial arrangements being made, it will merely mean that at 60 they will be receiving an unemployment pension. This will certainly be unacceptable to the miners. In conclusion, I should like to express my thanks for having been given this opportunity to make a few comments on the Supplementary Estimate.

7.53 p.m.

Photo of Hon. Adam Butler Hon. Adam Butler , Bosworth

I should first like to inform the House that my reading matter includes the Daily Telegraph, the Daily Mirror and the Morning Star. Furthermore, my headgear is sometimes as various and at other times nonexistent. Having referred somewhat lightly to the remarks of my hon. Friend the Member for Worcestershire, South (Sir G. Nabarro), I hope to return to his speech a little later.

I begin with the favourite opening of hon. Members opposite in a coal mining debate in which they say that we on this side of the House have no great sympathy for the coal mining industry, and there are no votes to be found in that sector. I totally refute this argument, particularly from a personal angle, and I would be prepared to guarantee that votes are to be found in that industry.

We have sympathy, but we also have something that seems to be lacking among Opposition Members—a sense of realism in our approach to this subject. A wage of £35 for a face worker does not seem to be too much money for the job that is undertaken. Today we read that the militant section of the National Union of Mineworkers will be looking again next year for substantial increases and a figure of £40 for those workers is mentioned. I suggest that in the context of the present wage structure, a figure of £40 is not necessarily wrong for face workers. But even a figure of £35 will put out of work thousands of miners. If £40 were to be granted this would cost many thousand more jobs in the industry. This is the realism of the matter and this is where I go part of the way with my hon. Friend the Member for Worcestershire, South.

My quarrel with the Supplementary Estimate is that it absorbs part of the wage increase. A strike in private industry must be paid for by private industry. The company concerned must meet the cost of the strike and the cost of the wage claim, if any, that is granted, and sometimes goes out of business because it cannot afford it. Most often it puts up the price and the public has to pay.

In this case the Government have chosen to carry part of the cost of the strike. Again the public pays because the £100 million which will be voted in this Bill comes from the taxpayer. I query whether it is right for the taxpayer to carry the cost of the strike in this way. Even if a compromise can be found—and it might be logical to suggest that the cost of the strike in terms of loss of production might be carried—it would be wrong to carry part of the cost of an additional wage increase.

My hon. Friend said that a figure of 7½ per cent. broke the C.B.I. initiative. I suggest that since the settlement was a "special case", then an increase in price above 5 per cent. should also be treated as a special case. If the correct mathematics for a £90 million wage settlement was a 10 per cent. price increase, or more, this should have been added to the price of coal.

Photo of Mr Alexander Eadie Mr Alexander Eadie , Midlothian

Is the hon. Gentleman saying that Wilberforce was too generous?

Photo of Hon. Adam Butler Hon. Adam Butler , Bosworth

That was not the run of my argument. I was saying that a wage increase should be found through the price of the product, not through subsidies in other ways via the taxpayer. The logic of Conservative philosophy must lie in the sort of competition mentioned by my hon. Friend. However, I do not go the whole way with him. I believe there must be some Government aid, but it must be aid aimed at helping to bring about a slim and efficient industry which can compete. Some aid too is necessary to safeguard the strategic national interests. We cannot risk being dependent to too great an extent for very much longer on foreign oil.

We are uncertain how much natural gas we can draw on in the years ahead. We are uncertain how much oil is available to us, as to its quality, and whether it will be suitable for power stations. We are also uncertain about the duration of that supply.

But we can be certain that some of our fuel requirements will come from these new sources. We can be certain that our dependence on coal must grow less. This means that the coal industry must contract. It has hastened its own contraction by obtaining a wage increase of the sort we have seen. If it aims to achieve a further increase of the same magnitude, it will further hasten its contraction.

What is not commonly known is that even the most efficient pits such as those found in my constituency are not at the moment profitable. As a result of the industry's pricing structure, the quality of coal which is mined in my pits and which goes to power stations does not attract a price sufficient to show an adequate profit, and although ours are the most efficient pits in the country, we are not producing profitably. If that is the case in my area, can we believe that there is a profit in the coal mined in, for instance, the pits in the constituency of my hon. and learned Friend the Member for Dover (Mr. Peter Rees)?

Photo of Mr Peter Rees Mr Peter Rees , Dover

It is true that the East Kent coal field has been continuously in the red since the war, with one exception. However, it is hoped that, with the insatiable demand for coking coal, which can be supplied from East Kent, there is a profitable future. However, that depends on the people who work there and those who lead them. What the future brings is up to them.

Photo of Hon. Adam Butler Hon. Adam Butler , Bosworth

I too, hope that there is a profitable future for mining in Kent and in other areas as well. However, the train of my argument is to the contrary, and when as distinguished and as honourable and dedicated a servant of the coal industry as Lord Robens says, as he did in the last few days, that 50,000 jobs in the coal industry must go, I am inclined to believe him ahead of many others.

Photo of Sir Gerald Nabarro Sir Gerald Nabarro , Worcestershire South

My hon. Friend says that the coal industry must contract. When he says that, he is speaking for himself alone. He is not speaking for me. Whether or not the coal industry contracts depends entirely on Government policy. As one half of all the coal is burned in power stations, we may well see an expansion of the industry if the Government decide to invest in several coal-fired power stations.

Photo of Hon. Adam Butler Hon. Adam Butler , Bosworth

I am not sure that my hon. Friend is quite following my line of thought. If the Government are prepared to do that and are not prepared to invest in convertible power stations, which is the safer and wiser policy, there will be an assured market for coal in the future, but it will be running at a greater loss or at a greater degree of subsidisation than anything that we have had in the past. This, in the context of the potential for fuel energy supplies for the future, would, in my view, be wrong.

I intended to intervene only briefly. I have made my points. I hope that I have expressed regret at what I see as the certain outcome for future employment in the coal industry. It is one of contraction. But I believe in the long run it is right that the industry should pay high wages. It should be sufficiently profitable to do so. Without massive Government subsidisation, which I reject, this can only be achieved by operating fewer pits at a profitable level.

8.5 p.m.

Photo of Mr Edward Milne Mr Edward Milne , Blyth

The hon. Member for Bosworth (Mr. Adam Butler) for some part of his speech dwelt on the supposed impending contraction of the mining industry. He followed the Tory trend in the weeks after the Wilber-force Report by appearing to lecture to the miners that they should not have applied for a wage increase at all since all they were doing was running themselves out of their jobs.

It should be said about any impending contraction of the industry that, unlike its contraction in the past, any future contraction must be preceded by the attraction and introduction of new jobs to the development districts in which, for the most part, the mining industry is situated. It is only by that and by gearing it to the fact that we move towards full employment rather than towards higher unemployment that the problems of the mining industry and of our fuel economy can be met.

I was disappointed to hear the hon. Gentleman quote with seeming agreement the prediction of the ex-Chairman of the National Coal Board that the victory of the mineworkers in the recent wage dispute would lead to the loss of 50,000 jobs. I believe that this will seem to be as accurate a statement as a great deal of the sunshine talk that we heard from Lord Robens over the 10 years that he was in the industry. If many of his statements during his term of office had been as accurate as they were claimed to be, the dispute through which we have just passed and the consequences of it would not have needed to be visited upon the nation.

I wish to deal briefly with the Supplementary Estimate of £100 million. It is being spoken of in certain quarters as if it was some sort of subsidy to the Coal Board. However, it is only an instrument to enable the Coal Board to clear one of its immediate financial hurdles. In terms of interest charges and other consequences, it is a further millstone round the neck of the industry. I hope that we shall hear from the Minister not so much about the strike and the likely consequences of it as about the future rôle of coal in our fuel economy and how the Government intend to deal with its finances.

When we talk about the contraction of coal, we must not forget the great number of imponderables attached to it. The Government speak optimistically about an expansion of industry which will lead to a rising demand on our energy requirements. At the moment, in terms of the four fuels supplying our energy requirements, no one can make any accurate forecast of demand for the foreseeable future. It would be a major disaster if the Government used the consequences of the recent coal dispute to run down coal in some way to punish the miners for having dared to ask for something approaching a decent living wage.

We want to know not just the effects of the Supplementary Estimate on the coal industry but its likely effect on the overall energy requirements of the nation for at least the next decade. While there may be some small reduction in the industry's production figures in the coming decade, in my view it will be considerably less than people anticipate.

In the mid-1960s it was said that by 1975 coal's contribution to our energy requirements would have reached just under 80 million tons. I believe that that figure is much lower than will be needed in the next five to 10 years to provide the fuel that the nation requires.

I come back to the Supplementary Estimate. Ought we not to be looking at the coal industry itself, the method of its financing, and so on? The hon. Member for Worcestershire, South (Sir G. Nabarro) spoke about the claim by my right hon. Friend the Member for Manchester, Cheetham (Mr. Harold Lever) during the dispute—not so much a claim, but an appeal—for the £900 million of outstanding debt to be wiped off. This is a matter which the Government must look at. The outstanding debt is now £950 million. The Government should look at that matter not merely because of an appeal on the part of the coal industry to have this load taken off its shoulders, but because it would also be of advantage to the nation.

We talk about the financial demand on the industry as though it were a subsidy. Are we not forgetting that the people who have made the real contribution to British mining, by spending their working lives in the industry, receive from the Coal Board each year a pension contribution of just over £13 million, whereas the interest charges on the money which the Coal Board receives rate an annual tribute of well over £30 million? In short, it is better to have loaned money to the Coal Board than to make a contribution to the stability of Britain's mining industry when measured in those terms.

Ought we not also to look at the structure of the Coal Board itself and the running costs of the industry? The cost of the production of coal, the improvements in output, and all the other records that the miners have achieved in the last 25 years have failed to give them the wage level to which they are properly entitled, and even the Wilberforce award has left them far short of achieving it.

The hon. Member for Bosworth talked about a likely further claim by the N.U.M. in 12 months' time. The N.U.M. will be doing no more than Wilberforce was inviting it to do. The lesson and logic of the Wilberforce recommendations was that this wage increase was merely a halting stage on the way to seeing that no longer was the mining industry and the need for coal regarded by the nation as obtainable at the expense of low wages in the industry. Therefore, if Wilberforce has any meaning or logic, it is for a further wage application by the N.U.M. within 12 months. It is not, as some hon. Members opposite have indicated, a question of holding the nation to ransom. The Wilberforce Report is the key not only to the next wage demand by the N.U.M., but to a future stable coal industry.

This is why I believe that either this or the next Government must look at the structure of the National Coal Board. Is it top heavy? Is it too over-manned at the top at national level? Do we still need the National Coal Board headquarters in London when the industry is situated elsewhere? Would it not be better to have the industry operated on a regional or area basis with only small overall supervisory control from the centre, instead of the massive, somewhat unwieldy, organisation which we have at present?

I do not profess to argue that this is the answer. I suggest that we need to look at those matters as well as the financial requirements and provisions which are necessary for the industry in the years ahead. Therefore, we must go beyond a debate in the House of Commons. We must ensure that the Government either set up a Royal Commission on the industry to examine the points which have been and will be raised in the debate, or produce a White Paper on the industry and on the nation's future fuel and energy requirements. To fail to do this would be little short of disastrous not only in the interests of the mining industry and the mining communities, but in the best interests of the nation.

In addition to looking at these matters—I hope that the Minister will deal with this point in his speech—we ought to look at the assets already held by the Coal Board. For instance, why is it that people who lived in Coal Board houses a number of years back on a rent-free basis—not that they were living in those houses rent-free in the terms that many of us would consider "rent-free" to mean, but because rent-free housing was part of the wages structure of the industry which these people were serving—are now paying rents of well over £2·50? Those houses, now older and in some cases category C houses which cannot be brought up to proper standards, are fetching rents for the Coal Board, or some of the landowners to whom they have been handed back, of well over £2·50 and there is talk of raising the rents of those houses to well over £3·50 for retired miners. Therefore, the assets available to the Coal Board and the means of using them to further enhance the interests of the industry require the Government's immediate attention.

I hope that this will not be regarded by the Government as just another debate on the mining industry and that they can forget about the issue until it rears its head again. Let us have positive proposals and action from this moment.

8.20 p.m.

Photo of Mr Peter Rees Mr Peter Rees , Dover

I had not intended to intervene in this debate, and I apologise for doing so to those who have spoken, but any coal debate has a compulsive, perennial fascination for anyone who has the privilege to represent a constituency with even a small seam of coal in it, and therefore I hope that the House will forgive me if I take up a little of its time.

I am sorry that the hon. Member for Blyth (Mr. Milne) made an attack on Lord Robens, whom I have always regarded, at any rate during the period after he left the House, as a distinguished public servant. However, I have no doubt that Lord Robens can look after himself.

Photo of Dennis Skinner Dennis Skinner , Bolsover

He always has done.

Photo of Mr Peter Rees Mr Peter Rees , Dover

The hon. Gentleman has, however, emphasised one important fact which did not escape the notice of the miners in my constituency. It is that six of the 10 years during which Lord Robens presided over the destinies of the National Coal Board were years when we had a Labour Administration, and it was particularly in those years that the miners lost their place in the industrial pecking order. That fact has not escaped the notice of miners in my constituency in Aylesham, Elvington, and similar places.

Photo of Dennis Skinner Dennis Skinner , Bolsover

It is true that the miners did, to some extent, lose their place in the pecking order during those years but does the hon. and learned Gentleman remember—perhaps he does not—that the lowest-ever wage increase offered to the miners during the administration of Lord Robens, as a result of going to arbitration, was l0d. a day, during the period of the Tory Government?

Photo of Mr Peter Rees Mr Peter Rees , Dover

If it was accepted, presumably the mining industry felt that it was justified. If it was not accepted, perhaps the hon. Gentleman will have an opportunity to enlarge on the point that he is making.

The hon. Member for Blyth dragged across the trail that rather old and pungent red herring about borrowings from the Government by the board. What the hon. Gentleman did not emphasise—and, frankly, hon. Gentlemen opposite rarely emphasise this—is that four-fifths of Government borrowings have been written off over the last five years and the interest on the outstanding borrowings, substantial though it must be by any standard, being £30 million, is not ultimately going to make or break this great industry.

As regards the rents of houses owned, or once owned, by the board, if the rents go up, then, in view of what the hon. Gentleman said about pensions paid to people who formerly worked in the coal industry, I am confident that they will be eligible for rent rebates because of the far-sighted Measure which the Government have introduced and are still fighting through Committee.

It was not those small points that I wanted to take up. I tell the hon. Gentleman that on his major contribution—a far-reaching review of the industry—I find myself almost entirely in agreement with him. I shall come to that in due course.

This Supplementary Estimate is an inevitable consequence of the acceptance by the board of the Wilberforce Committee's recommendations. Tonight I shall not analyse or quarrel with Lord Wilberforce's recommendations. I have never believed in quarrelling with a referee, or even with the Chair in this House.

Photo of Dennis Skinner Dennis Skinner , Bolsover

I have never been known to do that.

Photo of Mr Peter Rees Mr Peter Rees , Dover

Mr. Deputy Speaker, I am delighted to hear of the unequivocal acceptance of your rulings by the hon. Member for Bolsover (Mr. Skinner). I hope that that will give you great comfort in the days to come.

The Wilberforce Committee's conclusions and their acceptance involved a measure of strain on the industry, or on the finances of the country. It was inevitable, with the financial structure of the industry as it was before Wilberforce, that the recommended increases could not be absorbed, and therefore there were four inevitable consequences. The consequences could have been mixed anyway, and it may be that the board will have to adopt a mixture of all four.

First, inevitably, there would have to be a rise in the price of coal. Indeed, we have heard that it is to be a rise of about 7½ per cent. I put it to my hon. Friend the Member for Worcestershire, South (Sir G. Nabarro) that there was a certain inconsistency in the position that he took up and that he was not able, as I thought, entirely to reconcile his complaint that these price increases break the compact between the Government and the C.B.I. with his statement, in the next breath, that the whole consequences of Wilberforce should have been absorbed by increases in the price of coal. I felt that it was inevitable that there should be an increase in the price of coal, but that 7½ per cent. was perhaps the maximum that could readily be absorbed without grave inflationary effects and a gross breach of the compact negotiated between the C.B.I. and the Government, so I do not quarrel with that.

The second inevitable consequence was that there should be a Government subvention to the N.C.B. That is the point of the Supplementary Estimate. The other two possible consequences—and we have yet to discover whether they are inevitable—are, first, a reduction of loss-making pits. Hon. Gentlemen opposite have talked about that. If there are to be reductions, hon. Gentlemen opposite are right to emphasise that alternative forms of employment should be found for the people in those pits. Finally, there should be an increase in productivity, because if there were an impressive increase the Wilberforce bill might more readily be met.

I have always believed that the coal industry should be a competitive industry, paying competitive wages. The corollary to paying competitive wages—I hope that hon. Gentlemen opposite will accept that competitive wages will now be paid—must be a competitive industry. We have made a start, but I shall press my hon. Friend for a fundamental review, with the board, of the industry and of all the consequences of the Wilberforce Report. That is where I find myself in total agreement with the hon. Member for Blyth. Whether or not it should be by Royal Commission I do not care, but I hope that there will be a far-reaching and fundamental review of the industry.

I conclude by setting out some of the points that I consider to be important. First, what is the right size of the industry? This opens up all sorts of fundamental questions which it probably would not be proper to debate tonight. What is the right mix between various sources of power? Hon. Gentlemen opposite have touched on that. It is just one of the fundamental questions that have to be considered.

Indeed, Lord Wilberforce touched on that issue, because he said that there was nothing sacrosanct in the figure of 140 million tons a year, He said that it might have to go down to 90 million tons. I am in no position to say—and I do not know whether hon. Gentlemen opposite are—what exactly is the right figure. That is something that we have to consider both in the national context and in the context of the industry itself. If it is to be a small industry, which pits have to close? Which pits can we no longer afford to maintain?

I am sure that hon. Gentlemen opposite will recognise that over the last 10 to 20 years there has been a certain welfare aspect about the N.C.B. From speaking to miners in my constituency, I know that many of them recognise that. They say, "We do not want to work in pits if there is no real contribution from them to the economy", but they add that if pits are to be closed they want some alternative form of employment. These are important questions, but we cannot answer them tonight. They can be considered dispassionately only in a long-term review of the industry.

There is a worry among many who work in the industry and look at it from outside that coal is not priced realistically. I have no means of checking, but I have been told that some grades of coal are sold to industry at below the cost of production. The national interest may be involved in damping down the fires of inflation, but this is a fundamental question which the Government and the N.C.B. should consider.

Are the profit margins of retailers too high? A dispassionate inquiry may show that they are not. When a member of the National Union of Mineworkers in my constituency, Mr. Jack Dunn, wrote to a prominent member of the retail trade that the retail profit margins were too high, the powerful reply that he received demonstrated that the retail side has contracted more rapidly than mining it self. I should like to see this question disposed of, if not once and for all at least for our generation. Is the retail industry making too much profit? Should there be more competition? Is competition fair betwen the private retailer and the retail division of the N.C.B.?

I know that productivity has almost doubled since 1947, from 20 cwt. to 40 cwt. per man shift. That reflects great credit on those who work in the industry, but it also reflects massive capital investment. Would a further massive injection of capital, further mechanisation, yield equally impressive results? [Interruption.] Some hon. Gentlemen obviously think not, but if not, the industry should not look for further Government subventions.

We should also consider absentee ism—

Photo of Mr Peter Rees Mr Peter Rees , Dover

In this place or any other place, but tonight we are considering the coal industry. I do not know whether the hon. Member thinks that he earns his salary. That is a question between him and his conscience—or between him and his constituents. He should answer that question at another time and in another place.

If we are to have competitive wages we must have a competitive industry, and the problem of absenteeism should be looked at. There may be a perfectly rational explanation. Perhaps we ask too much of those who work below ground. That is not. a question to be answered here, because the atmosphere is too feverish. There should be a cool inquiry by the National Coal Board or an outside body.

I want something constructive to come from this debate, as it did from our debates on the coal strike. I want to see a better industry—perhaps leaner, or fitter. If we are to pay these wages and ask men to do this work, we must ask whether they are producing the right kind of coal, in the right way, in the right place, and at the right time.

The country has been asked to pick up the cheque for the coal strike, so the country is entitled to know whether we have the right coal industry. Is this great industry, which is still fundamental to our economy, being run in the right way? I hope that the Minister will give us some of his thoughts on these important questions, if not tonight, at some other time.

8.33 p.m.

Photo of Mr Joseph Harper Mr Joseph Harper , Pontefract

We should not have been discussing this Supplementary Estimate had it not been for the Government's appalling attitude in allowing the miners' strike to take place and then allowing it to continue for seven weeks. Not many right hon. and hon. Members opposite will agree with that assertion, but it is true. The strike could have been settled much earlier, at much below the ultimate cost.

We keep knocking the industry, yet the following figures are relevant: 100,000 of the 278,000 male employees are under 40; 178,000 are over 40; nearly 70,000 of those 178,000 are over 55. Therefore, in ten years' time, providing that we do not knock the industry too much, we shall have a much younger work force than we have at present.

The hon. Member for Worcestershire, South (Sir G. Nabarro) made an interesting and eloquent speech, in almost his usual rocking horse style—he rocks backwards and forwards as he orates. However, the hon. Gentleman was not his usual self tonight. I thought that he was irresponsible. I am relieved and thankful that during the hon. Gentleman's speech I did not notice the Minister give one nod of agreement with what the hon. Gentleman was saying.

The hon. Member for Worcestershire, South talked glibly about the 2d. a gallon tax on oil. The present Mr. Speaker was Chancellor of the Exchequer in April, 1961, when that increase was imposed. The increase was imposed not to protect the men in the industry, nor to protect the coal industry, but to raise revenue. The revenue was estimated to be £50 million in that year and £60 million in the following year. It has been said tonight that the resulting revenue is now £135 million. The hon. Gentleman asks for the removal of that 2d. a gallon tax so that oil can be competitive with coal

The hon. Gentleman did not make great play of the fact that the miners' recent wage increase will result in the price of coal being increased by 7½ per cent. I have never known a Government act so stupidly in imposing an increase because they wanted to convince the country that this was the result of the miners' strike and the increased wage award.

Photo of Hon. Adam Butler Hon. Adam Butler , Bosworth

Does the hon. Gentleman disagree with the increase in the price of coal or merely with the rapidity with which it was imposed? I hope that he acknowledges that, in the words of the Leader of the Opposition, one man's wage increase is another man's price increase.

Photo of Mr Joseph Harper Mr Joseph Harper , Pontefract

We have heard all that tripe before. We have heard all the tripe about one man's wage increase being another man's redundancy. If anybody knows anything about redundancy, it is we in the mining industry, because since 1949 no fewer than 490,000 of our people have been made redundant. I am not disagreeing with the price increase of 7½ per cent.; we realised that the price of coal would have to be increased. That was the point that I was coming to before the hon. Gentleman jumped on to the table before the dinner was ready.

Some months ago I obtained some figures—the figures are now a little out of date—relating to the price of coal that we import. These figures must be seen in the context of an increase of 7½ per cent. on the price of indigenous coal. These are the sort of prices we must pay for coal from other countries: from Australia, £9·2; from Belgium, £20·46; the Irish Republic, £8·21; Netherlands, £9·92; Norway, £30; Poland, £10·46; South Africa, £35·95; the United States. £9·32; and West Germany, £21·52.

Photo of Mr Peter Rees Mr Peter Rees , Dover

The hon. Gentleman will agree that those figures are meaningless unless they are related to grades of coal.

Photo of Mr Joseph Harper Mr Joseph Harper , Pontefract

I agree. The figures were given to me by the Department. The pithead price of United Kingdom-produced coal varies between £4·50 and £15.

Photo of Dennis Skinner Dennis Skinner , Bolsover

Does my hon. Friend recall that when he was given those figures some months ago in reply to a Parliamentary Question it was made clear at the time that the grades of coal to which they referred were those required not for general use but for the British Steel Corporation, which are low grades, and for the Central Electricity Generating Board, which requires a type of coal that we in Britain can produce for less than £4?

Photo of Mr Joseph Harper Mr Joseph Harper , Pontefract

Yes. The figures I quoted relate to some of the cheapest grades of coal.

We have said time and again that the prosperity of the nation in the post-war years was built on coal at a reasonable price. We missed the boat because of that. It is all very well for hon. Gentlemen opposite to talk about a free market, but if we had got the price we could have charged for the coal we produced after the war—we could have asked for the moon at that time, and got it—the industry would not now be in this state. We would not have needed to ask the last Labour Minister for £415 million and something over £400 million from the present Minister to put the industry on a proper footing. But that is water under the bridge. There is nothing more dead than a pit that is finished, closed and not producing coal.

I take issue with my hon. Friend the Member for Fife, West (Mr. William Hamilton)—I seldom have to do this—over what he said about the pension of £1·50 in the mining industry. But he was right to say that those who were responsible for arranging the pension should have their heads examined. I was one of them. Not only should we have our heads examined; we should be certified for falling in the way we did. In the first place, it was £1. It was recently increased to £1·50, but as the supplementary benefit grabs the 50p, it is fair to say that the N.C.B. scheme is subsidising the Department.

In 1952 we got two weeks holiday with pay for the first time in the history of coal mining. We had had many weeks holiday without pay—too many to count—and the N.C.B. said "If you are prepared to work the second week, we will pay you your week's holiday money and whatever you earn, and we will put £2 million into a pension fund to start you off on a pension scheme." We fell for it.

Photo of Dennis Skinner Dennis Skinner , Bolsover

It will not happen again.

Photo of Mr Joseph Harper Mr Joseph Harper , Pontefract

You can bet on that.

Some of our old people got payments straight away for little or nothing—except 50 years' endeavour in the pits—worth 10s. a week. That was increased to £1 and later to £1·50. Wilberforce pointed out that there should be a review not only of redundancy payments but of pension rights.

Photo of Mr Michael McGuire Mr Michael McGuire , Ince

I am grateful to my hon. Friend for reminding us about that scheme. Will he explain that for those miners who fell between both stools and did not qualify for the 1952 scheme, we in the industry paid a couple of coppers a week, without subsidy from anyone, to give them an admittedly small pension but one which was much prized?

Photo of Mr Joseph Harper Mr Joseph Harper , Pontefract

That is correct. That had escaped my memory. I have made the point crystal clear. Much has been said about the need for a fuel policy. We have tried repeatedly for this. The Minister's predecessors did something about a fuel policy of £250 million by 1970, and the money was borrowed on that projection. That is why we are faced with all our troubles. My right hon. Friend brought out his fuel policy in 1967. That has been proved hopelessly wrong. Whether it is the present Government or a future Labour Government who try to get a fuel policy, they will be faced with a difficult problem. It is not as simple as is thought by the hon. and learned Member for Dover (Mr. Peter Rees), as a past town clerk, preparing his budget estimates in the April or May meeting of his council. It is full of so many imponderables.

Photo of Mr Peter Rees Mr Peter Rees , Dover

The hon. Gentleman could not have been listening to my speech. It is because of the difficulty of it that I suggested that we were not likely to evolve any answer this evening and that we should have a cool, dispassionate view outside the House. Everything the hon. Gentleman has said confirms my view that we are not in a mood tonight to reach conclusions.

Photo of Mr Joseph Harper Mr Joseph Harper , Pontefract

No one is cooler than I am. I never get het up about these things. I have been trained for years in a hard school and my feelings never show. I was once described as speaking with great emotion in the House. It was not emotion; I had a bad attack of influenza and my voice had cracked.

I address myself to the future fuel policy. On 21st December there was a meeting between the National Executive Committee of the National Union of Mineworkers and the Chairman of the National Coal Board and other officials. The pattern of energy policy was laid down, for which I shall read the figures. Within a decade it will remove our utter dependence on oil from the Middle East.

The total energy consumption in 1971 was the equivalent of 330 million tons of coal. These are the Coal Board figures. They show that by 1980—say 10 years hence—we shall need the equivalent of 430 million tons of coal. There is another imponderable here. If we have a continuation of a Conservative Government until then, we shall not need the equivalent of 430 million tons. It will be much less than that. But, to be fair, it is 430 million tons, of which coal provides at present 140 million tons.

The Coal Board is not asking for 200 million tons or 250 million tons. It is asking for the present figure of 140 million tons to be left. The industry, in view of what I have said, will be able in 1980, given the opportunity, and if we do not keep knocking it and destroying confidence in it, to get 430 million tons of coal; what is more, with reduced manpower, some 70,000 employees in the industry are over the age of 55. We must give confidence to the industry and to our youngsters to take up mining as a career. It would be a good job if we could do that—we need the coal, which has to be paid for and worked for—but we cannot do that without youngsters coming in in such numbers that they replace the older people leaving the industry.

Of the 330 million of coal equivalent, nuclear and hydro-electric power accounts for 12 million and the Coal Board says that will increase to 40 million; North Sea Gas is 24 million of coal equivalent, which will increase to 70 million; and North Sea Oil, which is nonexistent at the moment, is estimated by 1982 to be worth 80 million tons of coal equivalent. Imported oil, which now accounts for 47 per cent. of the total requirements, will fall from 154 million to 100 million which will mean we shall be dependent on Middle East oil to the tune of 23 per cent. only, which will be half the present liability rate.

In arriving at an energy policy we must take notice of those who know most about it. The 1967 White Paper, although an admirable White Paper, has failed dismally. A lot of its predictions and targets are wrong. If we can arrive at a proper fuel policy and restructure the coal industry on a proper footing then there is a future for it and a future for mining for many years.

I want to make a pedestrian point about fair rents. An hon. Member from the Government side of the House referred to the fact that rebates would be paid. I have never known anyone try to brainwash this country more than the Government about rebates and fair rents. If a tenant is paying £2 a week in rent which is increased to a fair rent of £4 a week, even with a £1 rebate he will still be paying £1 a week more. It will be no comfort to him to tell him he will be getting a rebate. That is a load of nonsense.

We must try to educate our people against being told that everyone will get a rebate and everyone will be better off and there will be a surplus at the end of the road, 50 per cent. of which will go to the Government and 50 per cent. to the local council. There is not a mathematician in the House who can make an equation of that kind balance. We never should have been discussing this matter tonight. The £100 million is in the Supplementary Estimate simply because the Government caused it to be there.

8.54 p.m.

Photo of Mr Harry Ewing Mr Harry Ewing , Stirling and Falkirk Burghs

I have few if any miners in my constituency, and therefore I do not speak with the authority of those who represent mining constituencies. I represent a constituency in which is centred the heart of the oil industry in Scotland, if not in this country. I am interested in the future fuel policy, and on behalf of my constituents I want to ensure that oil plays its full part in any policy which may be decided by the Government. I cannot avoid the feeling that after the debate the miners will heave a sigh of relief and express the hope that at long last Parliament and the Government will be taken off the backs of the coal industry and the miners. In recent months the miners have been through a very traumatic experience, and it does no one any good to allow the situation to exist and to cause debates to take place where hon. Members, particularly from the Government side, are allowed to draw out their old prejudices against the mining industry.

I listened with interest to the two main points that seem to have emerged so far. One was the economic theory that if workers will accept only the level of wages that the Government determine is good for their industry they will enjoy a longer life in it, and their future will be more secure. That has not been proved by precedent. My hon. Friend the Member for Fife, West (Mr. William Hamilton) referred to something in which I was involved—the postal strike, last year. In the end we were forced to accept what the Government dictated, yet not long afterwards the Government were talking of sacrificing 25,000 jobs in the industry. Therefore, if workers in any industry, and especially the mining industry, accepted the Government norm—whether it be 8 per cent., 7 per cent. or 20 per cent.—their future in that industry would not necessarily be the more secure.

The second main point was the theory expounded by Conservative Members that what we need is a much slimmer, more efficient and, therefore—they say—better-paid mining industry. I cannot help recalling the theory of the American trade unionist, John L. Lewis, that workers were much better off with a small, well-paid labour force than a poorly-paid labour force. The miners would speak eloquent testimony to the fact that as a result of subscribing to that view over years of successive Governments they have finished up with a small, poorly-paid labour force rather than a small well-paid labour force. Therefore, I am concerned about some of the views expressed by Conservative Members.

The future fuel needs of the country must also be taken into consideration. Our fastest-expanding industry is the energy supply industry. If there is to be a greater need for energy it seems ridiculous to suggest that we should contract part of an industry that supplies it, namely, the coal industry. I wonder, like one of my hon. Friends, how we can reconcile the view that the Government are trying to expand the economy with their talks of contracting the coal industry.

It ill behoves Lord Robens, of all people, to talk about 50,000 miners losing their jobs as a result of the industrial dispute from which the country has recently emerged. He should realise that the only thing that saved him from having to handle such a dispute was not his efficiency or ability but the fact that the rules of the National Union of Mine-workers at that time necessitated a two-thirds majority before strike action could be called. So he has nothing to look back on with credit to himself. It ill behoves him to talk as he did at the end of last week, spreading fear and panic in the mining industry at a time when all concerned with the industry—Government, Opposition, National Coal Board and N.U.M.—should be doing their level best to instill confidence.

I finish on a general theme. Perhaps it will sink home before the Budget is announced. No Government of any political complexion in the industrial his- tory of this country have ever got away with creating a need for higher wages and then not being prepared to go even half way to meet it. If any Government have created a need for higher wages the present Government have, not only through the Housing Finance Bill but through the 13 per cent. rise in food prices, the withdrawal of school milk, the increased prescription charges—indeed, one could go on all night about the effects of their economic policy on the cost of living. If the present Government or any other Government think that, having created the need for higher wages, they can say to industrial workers—be they miners, postmen, seamen or any others—that they will not go half way to meet the need, they run the risk of the sort of conflict that took place with the miners.

I hope that two things will emerge from this debate. The first is the need for a co-ordinated fuel policy, and within that context I particularly emphasise the need to co-ordinate the developments of North Sea oil supplies. I warn the Government that they are placing the industry in a position in which, through indiscriminate development, benefits will accrue to no one. The Government should be taking a greater interest in the development of North Sea oil, and a greater financial interest, at that.

Secondly, I hope there will emerge a clear understanding by the Government that social justice will not only have to be done but must be seen to be done. No doubt that is an old cliché, but it is worth repeating at this time in our economic history. I hope that the coal industry in particular and the miners in general will now be allowed to settle down on a decent standard of living—which, after all, is what the miners were campaigning for in the recent dispute.

9.3 p.m.

Photo of Mr Robert Brown Mr Robert Brown , Newcastle upon Tyne West

I hope that the House will bear with me if the introduction to my remarks tends to have a constituency connotation. There were once seven pits in my constituency. Now we have not one. Nevertheless, many of my constituents are still miners in active work in the pits. Nearly all of them have had the dreadful experience of being made redundant more than once. Many of them have been shunted from pit to pit, first within my constituency and then, after the closure of the last of its pits—North Wallbottle—to pits in other areas of south-east Northumberland, involving considerable travelling time to work. Then those collieries in their turn closed down, so once again they were shunted from colliery to colliery in south-east Northumberland.

I want to personalise this issue by mentioning an old neighbour of mine. When the High Montague pit in my constituency closed, this old boy was faced with a transfer to Prestwick pit. In his lifetime of work at High Montague, he had been used more or less to stepping out of his backdoor almost directly into the pit cage. This man was of advanced years, probably the late 50's. In the mining industry this is an advanced age. Thousands of miners do not live to draw their retirement pension, and many of those who do do not enjoy it for long.

This man was transferred to Prestwick Colliery which necessitated a two-mile walk to the nearest bus stop, which took him five miles to the nearest point close to the colliery and then he had another two-mile walk. This was after he had spent almost a lifetime living more or less next door to the pit head. He had to walk four miles before and after a shift. Referring to the speech of the hon. and learned Member for Dover (Mr. Peter Rees), I cannot imagine many town clerks choosing to walk four miles before and after a shift.

Photo of Mr Albert Roberts Mr Albert Roberts , Normanton

My hon. Friend should add that that would be at half-past four in the morning.

Photo of Mr Robert Brown Mr Robert Brown , Newcastle upon Tyne West

I am grateful. This old boy to whom I am referring had been used to being wakened at perhaps one o'clock in the morning, and he might have had a cup of cocoa or a snack before going into the cage at twenty past one. This man is typical of many of my constituents who have suffered this sort of hardship.

I know that the Government do not relish the defeat of their policies through Wilberforce. Wilberforce need never have happened if we had not had such an obdurate Government, determined to teach a section of the public service workers a lesson. The Government tried to do it with my union members the year before last when we had the dirty jobs stoppage and last year they managed to do it with the postmen whom they drove back to work. Here 40 per cent. of the miners voted against strike action and the Government thought they saw a soft touch. They did not need to intervene, they thought.

What the Government did not understand—I doubt whether the Prime Minister understands anyone—was the mind of the miner. I should have thought that at least the Under-Secretary, being of Northumberland stock, might have had some idea of what miners are worth. If he did, his voice did not mean anything to his senior colleagues. True, there were 40 per cent. against strike action, but what the Government did not understand was that the 40 per cent. who voted against were as solid as the rest—more so, once the strike began.

The tendency among miners is that once a decision is taken those who are in the minority become keener than the majority to implement that decision. The Government did not expect this, and we had the nonsense of the Coal Board being instructed to withdraw its offer before the strike started. I do not regard Derek Ezra as an evil man, but as a weak tool of the Government.

Since the miners returned to work we have witnessed the savagery of Tory backbenchers. The hon. Member for Torquay (Sir F. Bennett) talked of closing the pits to save the miners from having to do this dangerous, dirty work. He suggested that the Government should rapidly change from producing electricity by coal to producing it by oil, natural gas or nuclear power. Hon. Gentlemen do not realise that the mining areas which are in the greatest jeopardy in Scotland, the North-East and South Wales, are already carrying the greatest share of the misery of unemployment and taking a desperate hammering from the Government's policies. The Supplementary Estimate of £10 million is bitter medicine for hon. Gentlemen opposite. It must be dreadful for them to have to swallow it so soon after the nationalisation of Rolls-Royce and also to have to swallow the £35 million for U.C.S.

My hon. Friend the Member for Fife, West (Mr. William Hamilton) has spoken of the need for a fundamental review of the future fuel policy. For a long time to come we shall need a fairly large mining industry, and it must be a healthy and contented mining industry. Could not the Select Committee on Nationalised Industries, of which I was a member, have a look at the mining industry? It has been suggested that a Royal Commission should be set up, but the trouble with Royal Commissions is that the report goes on to the Minister's desk, is read and gradually forgotten.

My constituents who are working in the pits want to be able to have confidence in the future. We shall need a strong, healthy mining industry for many years to come. Without it, the expanding economy which we are told is round the corner cannot be sustained. If we want youngsters to come into the mining industry we must give them confidence that they will be able to look forward to a lifetime's work in the industry.

It will be a great tragedy for this nation if we do not evolve a policy in which we can encourage young men to come into the mining industry so that they may be sure in the knowledge that they have before them a lifetime in a healthy industry.

Photo of Mr Albert Roberts Mr Albert Roberts , Normanton

Since we have had so many debates on this point, perhaps I should remind my hon. Friend that there has been talk about a fuel policy for the last 25 years.

We must bear in mind that oil and coal are extractive industries. Since day by day they are diminishing in quantity, we cannot afford to waste them, and therefore we must always see they are used efficiently. We must ensure that we keep a balance in our fuel policy. In the near future it may well be that oil will be extracted from coal quite cheaply, and I would remind my hon. Friend that this may make the product far more competitive than oil which is imported from the Middle East.

Photo of Mr Robert Brown Mr Robert Brown , Newcastle upon Tyne West

I am grateful to my hon. Friend, who has great knowledge of the mining industry, for that contribution. Obviously, he can develop his point a little later if he has the opportunity to do so. I conclude by saying that I hope the Minister will resist the blandishments of the wild men behind him for an immediate and sizeable contraction in the coal industry.

9.17 p.m.

Photo of Mr Michael McGuire Mr Michael McGuire , Ince

The great advantage of this debate is that it enables hon. Members, in a calm and quiet atmosphere, to look at the coal industry rather than to concentrate overmuch on the effects of the national strike. There is no doubt that from time to time the coal industry has been the subject of scrutiny and people have produced various plans to seek to lay down their idea of a fuel policy, though we have not yet seen one actually adopted.

My hon. Friend the Member for Normanton (Mr. Albert Roberts) reminded us of the need to conserve something which most modern industrial countries are not merely preserving but are accelerating and developing. They are not leaving the materials in the ground but are using coal to help to expand their industries. Countries which are taking these steps include Russia, the United States and Poland, and certain other countries are creating industries where they have not had them before. They have had the coal, but have not extracted it at anything like a modern industrial rate.

When I was in the industry—and I and many of my hon. Friends around me are fully paid-up members of the union—I well remember the famous Idris Jones fuel policy. This was on the lines of the industry's being told, "There is a target, and the maximum that we expect is round about 253 million tons per year. "I was at that time branch secretary in a pit in which we had been busy for almost two years discussing how we could fit our manpower into the situation in such a way as to produce the expected tonnage. We knew that there would be a few closures, and we knew that other pits would be developed. We also knew that long-life pits were to be built up. We even built new pithead baths to accommodate 2,300 men. However, as things turned out the existing baths were adequate and we did not need the new ones. That was the kind of capital expenditure which went on in all the pits in the country which left the industry with a dead weight. That point was emphasised by my hon. Friend the Member for Pontefract (Mr. Harper). He is quite right. There is nothing deader than a dead pit. Curiously enough, it is very sad. I do not know why we lament the closure of pits. After all, they are not very good places in which to work. When the economy is at full stretch we know that men do not dash from Fords and other well-paid jobs to go down the pits.

Often I have polite arguments with doctors, architects and others in well-paid professions. They chide me about industrial wages, and lately they have chided me about miners' wages. My answer to them is a simple one. I do not know of anyone who has specifically set out to train his son to go down a pit and boast about it. That is hard fact. We can expect people to be miners only if we pay them wages which are more than commensurate with what is paid in outside industry. I do not take outside pay as the measuring stick. I think that the Wilberforce Report is right when it says that miners should be paid more than those in outside industry.

Photo of Mr Alexander Wilson Mr Alexander Wilson , Hamilton

Does my hon. Friend agree that the very essence of the success of the miners' struggle was that it showed that there is no substitute for a good miner? No one else is able to do his work when he is on strike. That is the essence of the Government's failure and the miners' success. The miners have proved that they deserve a real wage for the dangerous and dirty work that they do.

Photo of Mr Michael McGuire Mr Michael McGuire , Ince

I agree entirely with my hon. Friend. I shall come to that point later in my remarks.

I was saying that there is an element of sadness about a pit that has been closed. It may be argued that the sadness arises only because the men who have been put out of work have nothing else useful to do. However, there is something akin to an old warship about a pit that has been closed. Miners take a certain pride in the masculinity of their job. That is essentially true.

We have had plans for an annual output of 250 million or even 300 million tons, which have never been realised. Then we came down to the last plan, which was for about 140 million tons. It was never debated, nor was it accepted, but those of us in the mining group knew that there was a tacitly understood figure which was down to about 80 million tons by 1980. The figure was never mentioned, but we had sufficient knowledge from our reading to know that that was the ultimate aim.

Instead, there was a great shortage. Manpower fluctuated. When I first went into the pits we had men of 85 working there. Then we stopped them at 70. Then we stopped them at 65—quite rightly, because there was not enough work for those in the industry. We also stopped the influx of untrained men, and said that they could come in only as apprentices. I think that that was wise, too. But then we had a shortage of coal.

The solution is twofold. If we have the right policy, it will be possible to plan the manpower requirements. However, two winters ago, following the trauma that we had about colossal and runaway closures, the then Labour Government took a hand and tried to bring some social responsibility to bear. They said that if the Coal Board would bear a certain proportion of the cost the Exchequer would add so much to it. They tried to phase out pits, paying a subsidy to keep certain pits going for longer than they should have been.

After all that we find that when there was a coal shortage they blamed the miners. The Government said that they were short of coal. We had a programme of closing pits almost willy-nilly, and yet they said that there was not enough coal and they blamed the miners. It was incredible.

We must have a fuel policy, in the national interest. The Minister for Industry was a very effective member of the Select Committee on Nationalised Industries. He was a reasonably well-informed critic of the activities of the Coal Board. If we have to wait until we get a proper fuel policy I hope that it will be one which says to the Coal Board: "We, the Government of the day"—the Labour Government did not do it; I am not saying that we were everything perfect and white and that this Government are all black—"say that this is the amount of coal"—given a mild margin—"which we expect you to produce reasonably competitively in the national interest. Given that, we will then slot into position all these other requirements."

With the last fuel policy it was just the opposite. The Government decided what everybody else could produce, and then said to the Coal Board: "It might be that; it might be something else. We do not know. But do your best."

It reminds me of the story of the old lag in America who was up before the judge. He had obviously committed a lot of crimes. In America they give extravagant sentences. The sentence on that old lag was from 80 to 150 years in the "State Pen", as they used to say in all the best pictures which I watched as a lad. The judge asked the old lag, "Have you anything to say?" The old lag, who was about 75, said: "I have got arthritis, a weak heart, fallen arches. You name it; I have got it. I will never be able to do the sentence, judge." The judge said: "I know, but do the best you can."

That has been the attitude displayed by successive Governments to the National Coal Board. They have tried to show this tremendous sympathy without realising the practicalities of the job.

The key to the problem is a proper fuel policy. Following and concomitant on that will be a highly paid though obviously much slimmer industry.

My hon. Friend the Member for Pontefract reminded us that successive Governments—the Labour Government initially, successive Tory Governments, and the last Labour Government of 1964—have always dangled before the miners the carrot of a much bigger industry if they went for what they considered not to be too big an increase. I am ashamed now, when I look back and realise how modest the claims and increases were. I can recall 7d. a day once being awarded by arbitration. We used to go for modest increases. In other words, we used to ask for 15s. and expect about 7s. 6d. or 10s. Of course, 10s. was quite a reasonable increase. The carrot which was always dangled before the miners' leaders was: "Look, we know you are worth 15s. By jove, you are slipping down the table. However, you are a regional employment force in areas of already high unemployment and you must have some social conscience."

There is no doubt that this message got through to many miners' leaders. I have attended many conferences. Although I have not taken part in the big debate, I have been present and I have gone back to my branch with the message from conference that uppermost in miners' minds has been that if they took too big a slice of the cake the size of the cake would be diminished the next time, the next time, and the next time.

I can demonstrate that the miners still have a social conscience—and here I pay tribute to the miners represented by my hon. Friend the Member for Mansfield (Mr. Concannon). They demonstrated, as no other industry has done, their willingness to hold back when, quite justifiably and legitimately, they could have demanded and succeeded in getting high wages while still producing coal competitively.

The miners have a history of being against district agreements, because such agreements enable one district to be played off against another. Since they became a national union the miners have striven for uniformity. Basically, they have said that a miner in Scotland, in South Wales and in Lancashire, working at the coal face, or whatever job he is doing, should be paid basically the same rate. It has perhaps had some defects on the productivity side but it is, nevertheless, a wise and humane policy.

The miners have always been conscious that if they had too big a slice of the cake on one occasion, on the next occasion there would be less cake—but that was a false argument to use against them. The fact was that because they were receiving low wages they were slipping down the table and, in addition, jobs were racing away from them, with the result that they received no benefit at all.

The modern miners and their leaders take the view that low wages and poor conditions will not maintain their jobs. They sometimes wonder whether they are in any case worth maintaining. We must have a high-wage industry, with an increasing record of productivity, but a prerequisite of that is a proper fuel policy. I hope, therefore, that if the debate serves any purpose it will help to concentrate our minds on the fact that we need a coal industry, and that modern nations are not merely strengthening their coal industries but expanding them. That is the lesson for us, and I hope that the debate tonight will play some part in putting that lesson over to the Government.

9.32 p.m.

Photo of Mr Gwynoro Jones Mr Gwynoro Jones , Carmarthen

I agree with what my hon. Friend the Member for Ince (Mr. McGuire) said about the need for a fuel policy. It is easy for someone to say that he wants a fuel policy. Working it out may prove difficult, but if it had been accepted that the coal industry should be the cornerstone of our fuel policy, it being an indigenous fuel, and we having a fair idea of our reserves of it, we should have had a far better fuel policy than we have today. Instead of starting with coal as the base material for a fuel policy, successive Governments allocated energy requirements to natural gas and other fuels, and then used coal to make up the total requirement.

It is ironic that we should be debating what is termed Assistance to the Coal Industry and what, under a further subhead, is referred to as an Emergency Grant to the National Coal Board. We all welcome the emergency grant, but I am sure that it is not beyond the wit of the Government to understand that assistance to the coal industry would have been far better deployed had it been provided two or three months ago, and by a vastly different method.

One of my main reasons for taking part in the debate is to make sure that the Government do not try to put it over to the taxpayers of this country that they are having to bear the burden of the strike; that the consumer is having to pay for the strike through increased coal prices. It is our duty to emphasise again where the responsibility lies for the imposition of this £100 million on the taxpayer.

Nobody can deny that there has been a considerable mismanagement of the situation over the last three or four months. It started with a bluffing campaign. It was said that there was not to be any interference by the Government. Then it was said that the board and the unions were holding discussions and it was not the Government's rôle to interfere in such a situation.

The great bogy of wage inflation needs to be examined. If the Minister is going to blame it yet again as the basic cause of redundancy and unemployment at peak levels, perhaps he would consider two points. The report on Wales by the C.B.I. in March of last year inquired of 190 firms why there was a fall in demand, why they were announcing redundancies and lay-offs and why investment programmes were being abandoned. Of 20 reasons given for such action, investment grants and other things were at the top of the list, while wage inflation, the Government's main argument, was at the bottom. Why are areas of high unemployment also those with low wages?

This emergency grant to the coal industry need not have been paid. Not only did the Government's management damage the economy, the miners and their families and the general public; there is also the loss of equipment and production, and, on top of that, there is the wage bill. If the justice of this claim had been recognised earlier, we would not have lost £10 million or £15 million in production and £4 million or £5 million in equipment. After seven or eight weeks of strikes and many weeks of overtime ban, after the Government's great bluff, they said that the miners were a special case, and the Secretary of State for Employment said that they had maintained this from the beginning.

The Government bear the total responsibility, because of their insensitivity, for having had to bail out this industry. If one Minister had gone to mining areas and discovered the strength of feeling, I am sure that they would not have persisted in this policy. As for the problems after the strike, we have heard of the miners' loyalty and their rôle in the economy. Any hon. Member who was in doubt about that must have found it out over the last two months.

There need no longer be any doubt about the rôle of the coal industry in our economy. It is easy to mention statistics and to say that 70 per cent. of electricity comes from coal-fired stations, but in the last few months we found to our cost the true worth of the industry. The industry is a cornerstone in our economic development and in any assessment or reappraisal of fuel policy.

Perhaps of even more importance, it is a regional industry. The Government have proved so incapable of devising sound regional policies that our suspicions are aroused that the mining industry will suffer even more. In Wales, jobs in prospect are declining; in the last year 20,000 people have been made redundant; unemployment is 70 per cent. up; the number of new factories is half what it was in 1967, 1968 and 1969; only 5,000 new jobs were created last year, as against 20,000 people made redundant.

This is the background against which we are discussing the industry. In Carmarthen 2,000 people have been made redundant in the last year. Compared with the experience of many British towns, that is not a high figure, but Carmarthen is in the main a non-industrial area. It is becoming a fact of life that the coal mining industry, in, for instance, the Gwendraeth Valley, where I come from, is the only staple employment.

We want a categorical assurance from the Minister that there will be an acceptance by the Government of the present size of the industry. Not enough coal is being produced in Britain and we import millions of tons a year. We are not sure whether the world's energy demand will continue at the present rate. I have read somewhere that, if the post-war rate of growth of energy demand in the developed world continues, it is questionable whether the energy supply will be able to meet the demand in the year 2000. The Government should undertake that they will close no more pits.

This is more than just a regional problem. Nobody particularly wants to go down a mine. Although I am the son of a man who has worked in the mines all his life and both my grandfathers worked in the mines, I have been down a mine once, and that was on the occasion of the tragic disaster at Cynheidre a few years ago. We realise that no one is eager to go down a coal mine, but it is a fact of life that for too many people it is the only means of employment.

We must look at it, not purely as a regional problem, but in terms of Britain's whole economic prospects, the total demand for energy, and the contribution that coal can make.

We may have oil and natural gas around our coast, but what are the quantities? It is said that North Sea gas will run out in 20 to 30 years. For imported oil we are at the mercy of various countries. But with coal we know that we have beneath our feet enough to last us 100 to 150 years.

There is more to this whole issue than forecasting how much fuel we have or how long ahead we can look. Bound up with this whole problem is the need for a proper fuel policy. Before coming to this House I worked for the Gas Board in Wales as an assistant economist. I recall that on one occasion we were informed that seven out of ten householders in one newly-built estate had chosen gas for their main supply. This is, therefore, not simply a Government imposed policy but one of personal choice.

We must be assured that there will be a thorough appraisal of fuel policy, with coal established as the central fuel. It must be the cornerstone on which the policy is based. The Minister must also say that, whatever he is told by his supporters behind him, there will be no more pit closures. Some hon. Gentlemen opposite think the miners need a lesson because of the recent strike. That is not the case. Indeed, the experience of the last three months suggests that the Government rather than the miners need a lesson.

Hon. Gentlemen opposite are always telling us how they are the commercial wizards, the managers of the world; that when the going gets tough, just call them in and everything will be put right. If they really want to run the show in a business-like way, they should accept coal as the central fuel for their future energy policy.

I urge the Government to reflect that the recent dispute was the first national strike. The 1920 affair was not a strike but a lock-out. I trust that the Minister will confess that, in addition to the Prime Minister, there were other stubborn Members of the Cabinet and that collectively they mishandled the whole dispute. That followed the miners constantly being told, "If you ask for £1 more, 20,000 miners will be out of work." The Government stand condemned for their actions.

We need to examine the contribution that the Government can make towards restructuring the industry's finances. The Coal Board certainly needs assistance, but it did not require this form of assistance. Ultimately, this is not assistance but an admission of a major miscalculation which damaged the industry and our economy. The Government stand condemned on that basis.

9.50 p.m.

Photo of Mr Alexander Wilson Mr Alexander Wilson , Hamilton

My intervention in the debate will not be a very long one. Unlike my hon. Friend the Member for Carmarthen (Mr. Gwynoro Jones), I have been down a mine more than once. I have been down mines since I was 14, and until I came to the House. For that reason alone I am proud of the miners' struggle. I am even more proud that they have won their struggle against the most reactionary Tory Government that the House has ever seen.

In the Supplementary Estimate the sum of £100 million is mentioned. Had the Government shown a modicum of common sense when the miners first submitted their claim in the latter part of last year the misery and hardship bestowed on the miners and their families, and flung on to the British people, could have been avoided. The blame surely lies at the heart of the present Administration. The Government must recognise that all their pie-in-the-sky promises of the last 18 months about the expansion of the economy can be of no avail unless they recognise that the fuel and energy requirements of our economy depend to the extent of 70 per cent. on our coal industry.

One point that has not been mentioned in the debate so far is that there have been deliberate attempts by the Government to import coal, particularly coking coal, at a far higher price than that for which it could be obtained in Britain. That was done during October, November and December last year, with no other intention than to circumvent the claims of our miners. When we consider the importance of our only indigenous fuel and the fact that it supplies 70 per cent. of our energy requirements, we wonder where the true patriotism lies—and whether it is on the Government side or on this side.

Over the years, the miners did not struggle through, because of their patriotism, under a Tory Government or a Labour Government. The miners have been very lenient in their claims over the years, but they had reached breaking point when they decided that a reasonable standard of living must be given to them because of the dangerous nature of their occupation and the value of that occupation to the British economy.

The confrontation came but the Government did not see the light. They did not foresee the possibility of the complete solidarity exhibited by the miners and their families and they did not foresee the unity of the other trade unionists who were determined that the miners were entitled to a standard of living which rewarded them for their dangerous work.

One aspect of the debate has not been sufficiently highlighted. It is evident from questions to the Minister that the import of coal was increased from the moment the miners first lodged their pay claim and I believe that the Government intend that imports should be further increased. I hope they do not plan a conversion of coal-fired power stations to another fuel. I will give them a warning, as a miners' representative. I have the vested interest of 300,000 miners and their families, and so the warning is serious: what the miners did once they can do again when their livelihood is threatened and when their standard of living is at risk. Let the Government show where their patriotism lies by declaring that the only true indigenous fuel in this country will have its proper place in an integrated fuel policy which will help to expand the economy in the way the Government have promised for the last 18 months.

I hope that the Government will not too often tell the story about expanding the economy to the hundreds of thousands of unemployed. They do not believe that there will be an expansion of the economy. I doubt very much whether they will view the Budget tomorrow with other than scepticism, whatever it may bring, because not a single promise contained in the Conservative manifesto has come true.

The price of imported coke and coal cost the nation £7 to £8 a ton more than home-produced coal. Are the Government prepared to saddle industry with that extra cost, to the detriment of the coal industry in Britain? Are they prepared to see collieries like Cardowan and Bedlay in Lanarkshire shut? Are they prepared to see Lanarkshire turned into an industrial desert for their own purposes, or are they prepared to say now that they will give coal its true place in the expansion of the economy that the Cabinet says will come. Why close down collieries? Why attempt to convert power stations? Heavy unemployment would result from closures of concerns like U.C.S. and Rolls-Royce. But the figure would be far greater in the mining industry if there were further pit closures. Do the Tories say that everything must be measured in monetary terms, or will they consider the social consequences of pit closures?

Let them consider my own constituency, where 600 to 700 men and women were put on the scrap heap as a result of the research and development unit of Rolls-Royce being closed in March, 1971. Are they prepared to see the escalation of unemployment not just in Lanarkshire but all over the country? The job loss will be counted in thousands, in addition to the 1½ million now unemployed. I do not expect a Tory Government to measure the consequences in human terms. I doubt their ability to judge the human effect—the human consequences to men and women thrown on the scrap heap, particularly those over 50.

I hops that the Minister will acknowledge the needs and aspirations of the men and women in the coal industry who helped build up the economy to its present extent. It was they who built up the balance of trade surplus, not the Tory Party. They were the people who put the "Great" into Great Britain over the centuries—the ordinary working people, the miners, steelworkers, and so on. I worked in a pit, and two months before the General Election I took part in three pit closures.

Do not the Government realise that the miners are sick and tired of being shuffled about from pit to pit—[Interruption.]. The Minister may laugh, but he had better realise that the miners will no longer be pushed about by a Tory Government, or any Government; that they will not accept pit closures on the basis of economy, but will accept from the industry only closures based on the exhaustion of seams. They will not accept any more direction of labour as a result of Tory Government whims. What we demand when hundreds and thousands of men and women are placed on the scrap heap is direction of industry to the areas concerned—the North-East, Wales, Scotland, and so on.

Will not the Government accept the lesson taught them by the determination of our workers not so many weeks ago, to see that the great coal industry found its proper place in the economy? Instead of giving concessions on oil to private industrialists, instead of bowing their knee to foreign oil barons, will not the Government agree that their own people who built up the coal industry are entitled to a fair share of the economy? Will not they accept the need for emergency action in connection with the industry?

We believe this to be the most reactionary Tory Government in our history, but I make one last appeal to them. In Lanarkshire there are over 13,000 unemployed and fewer than 300 vacancies available for them. If another pit is closed in Lanarkshire for reasons other than that of exhaustion, the results will be on the Government's own head. Within the next 12 months—I give them no more than that—they had better, through one measure or another, alleviate the unemployment situation in the first place and, secondly, leave the coal industry alone, apart from giving it help to sustain itself and to build itself up as a modern industry within an expanding economy. If the Government do that, even I will be prepared to admit that that is at least one promise they are prepared to keep. I hope that they will sincerely consider the problem and do just that.

10.6 p.m.

Photo of Hon. Nicholas Ridley Hon. Nicholas Ridley , Cirencester and Tewkesbury

We have had a good and long debate, but I was a little surprised when the hon. Member for Fife, West (Mr. William Hamilton) selected this subject for debate. We had a long debate on coal and fuel policy on 10th March; we had many debates during the miners' strike; we have another debate tomorrow night on two orders to change the deficit and borrowing powers limits of the National Coal Board.

It seems that there is some apprehension in the minds of hon. Members opposite. We have had debate after debate in order, as it were, to ascertain from the Government whether in some way the events of the last few months have gravely altered the position and whether some threat has been caused—whether, indeed, the strike went too far.

Me thinks they do protest too much! I really would ask them to be a little more patient. I have said over and over again, as has my right hon. Friend, that these matters are being reviewed. The points which have been made are perfectly well understood. They have been taken on board long before tonight. There have of course been the usual careful studies in order to make sure that the right answers are arrived at. I am sorry, but I must tell hon. Members that I can give no assurances tonight about the future. This is no time to give them. Indeed, it is always dangerous to give assurances about the future at any stage.

It was clear that hon. Members, in the most eloquent and persistent terms, were arguing the case of the share of the coal industry in future fuel policy. I was surprised to hear not one word in defence of the small, privately-owned mines, which employ 2,000 people, nearly all in development areas, with their problems arising from the events of the last few months. Their problems are being looked at by my right hon. Friend sympathetically, just as he is looking sympathetically at the National Coal Board and its finances. But it did surprise me that, in all this talk about the coal industry and employment in the regions, not one mention was made of these privately-owned mines.

Photo of Mr Edwin Wainwright Mr Edwin Wainwright , Dearne Valley

Does not the hon. Gentleman realise that a week last Friday there was a Motion on the Order Paper, tabled by some of his hon. Friends, which sought to teach the miners a lesson? Today there have been two Questions on the Order Paper talking about accelerating pit closures, yet neither mentioned anything about jobs for miners once the pits were closed. Will the hon. Gentleman bear in mind that in almost all mining areas there is a high unemployment rate and before anyone talks about putting pressure on the Government to close mines there must be pressure on them to bring in new jobs to the areas?

Photo of Hon. Nicholas Ridley Hon. Nicholas Ridley , Cirencester and Tewkesbury

I did not notice that the terms of the Motion on Friday week inhibited the hon. Gentleman from making his usual forceful contribution, and I am delighted that he did. I am not complaining about the opportunity being taken to discuss the coal industry, I am just surprised that it seems to be so much in the minds of hon. Gentlemen opposite that they ought to make sure that the Government are not in some way trying to take it out of the miners, as the phrase goes.

Nothing that the Government have said should give the Opposition this impression, and they need not have this earnest desire to settle the fuel policy before basic studies have been completed to get the Government to commit themselves to a particular target for coal before we have had a chance to examine this question. Surely the time for this is when the Government can come to the House with some conclusions.

Photo of Mr Alexander Eadie Mr Alexander Eadie , Midlothian

The hon. Gentleman is being less than fair. I made the point that there was a Cabinet leak reported in the Daily Express during the miners' strike. The hon. Gentleman should tell us about this now that the strike is over.

Photo of Hon. Nicholas Ridley Hon. Nicholas Ridley , Cirencester and Tewkesbury

I will come to that point. I do not want to talk about the strike or the handling of it, but I do want to say something in all sincerity to hon. Gentlemen. They talk about victory as if there was no area of doubt but that to force the biggest pay increase possible is the right thing to do. I have listened intently to them and I want them to ponder upon whether, if every industry and every group of workers could prevail upon the Government to yield wage increases in excess of the national increase in productivity, it would serve any interest. The person who has been beaten is the ordinary citizen, not the Government. The ordinary citizen has made it clear that his or her main worry is rising prices. This is the effect of such pressures and such a settlement. It is bound to put up prices.

There was no singling out of the miners, to quote the hon. Member for Fife, West. There was no hymn of hate, as the hon. Member for Midlothian (Mr. Eadie) alleged. There is no particular feeling about any one trade, profession or industry. There is a policy which has been trying to bring about a moderation in the inflationary growth of incomes and a moderation in the rise in prices. This is being applied as far as the Government are able to do so fairly and squarely across the board.

Photo of Mr James Dempsey Mr James Dempsey , Coatbridge and Airdrie

The hon. Gentleman implied that it was the miners who forced a wage increase in excess of the national productivity increase. Is it not the case that it was the Wilberforce Inquiry that compelled the Government to meet the increase, not the miners?

Photo of Hon. Nicholas Ridley Hon. Nicholas Ridley , Cirencester and Tewkesbury

I do not quarrel with the hon. Gentleman except to say that the Government accepted the Wilberforce increase, which they might well not have done.

I remind the House of the advantages which the coal industry has. The hon. Member for Hamilton (Mr. Alexander Wilson) and others who pleaded for special help for this indigenous fuel must not ignore the position of the industry. Until the year before last coal imports were forbidden except in special cirmumstances. It was the shortage in the1971 winter which justified imports. The amount of coal which came into the country was very small, and much of it was coal which was not available in this country and was specially required for various metallurgical and chemical processes. The C.E.G.B. imported a considerable bulk of ordinary steam coal so as to secure its supplies when it was thought that coal would be in short supply.

The effect of this was wholly beneficial to the coal industry. The price of imported coal for ordinary steam-raising purposes tends to be higher than the price of domestic coal. The coal industry, therefore, has protection in the form of its own keen price. When one adds the cost of transport, distribution and handling to the price of foreign coal there can be no doubt that it is to the advantage of all consumers in this country to purchase home-produced coal rather than imported coal so long as the supply is available. Twice in the last 18 months that supply has not been available, and that is why consumers should have freedom to import.

Photo of Mr Alexander Wilson Mr Alexander Wilson , Hamilton

Does the Minister agree that pits have been closed far too readily under both Administrations? All I am asking is that the Tory Government should slow down the rate of closures so that pits are closed only because of seam exhaustion. It is folly for the Government to import coal which costs between £7 and £8 per ton more than it costs to produce in this country when they can keep open pits, particularly for coking coal on which the steel industry depends.

Photo of Hon. Nicholas Ridley Hon. Nicholas Ridley , Cirencester and Tewkesbury

I heard those remarks from the hon. Gentleman when he was sitting elsewhere. It is like stereophonic sound, coming from both corners of the room at once.

The Supplementary Estimate gives £100 million to the Coal Board as a grant for one reason only. This is that without it the Coal Board would be illegal in that it would have exceeded its statutory deficit limit at the end of March when its financial year runs out. Taken with the two orders which I shall move tomorrow, it ensures that the Coal Board will not exceed its statutory limits. This is the immediate action which had to be taken to prevent the Coal Board becoming illegal in terms of its power to run up deficits and to borrow. It has no significance other than the immediate short-term one of bringing the Coal Board financially into the clear. It is not, as my hon. Friend the Member for Worcestershire, South (Sir G. Nabarro) alleged, to finance the losses which will arise from the settlement of the pay dispute. It will probably be inadequate to meet short-term losses caused by the strike.

We have announced that the Coal Board will be increasing the price of coal by an average of 7½ per cent. which will bring in £60 million. That will still mean £30 million per annum of continuing deficit which will have to be met in the same way as I am at present specifying. But it must also be remembered that even the 7½ per cent. price rise will make coal less competitive. My hon. Friend's suggestion that the full cost of the settlement should be put on the price of coal would have drastically reduced the consumption of coal in a very sudden way.

Let us look at the other advantages of the coal industry. Over the last six years the contribution to its social costs which the Government or taxpayer have made amounts to £43 million. The Government's contribution to the redundant mineworkers' pension scheme amounts to £31 million; the Government's contribution to early pensions amounts to £7½ million. The Labour Government wrote off £415 million of capital, leaving it with a very low capital reserve of £675 million, and with an interest charge of only £36 million per annum. In addition, there is a fuel oil tax which provide? a protection in terms of its competitiveness of something in the region of a half new penny per therm, which gives it a considerable advantage in bidding for markets. It has no financial target at present, but its last target was to break even.

When the hon. Member for Fife, West suggests that its financial obligation should be greatly eased, I am not sure how one can ease an obligation to break even. Even if its entire capital were written off—which is not what I am suggesting will happen—the reduction of only £36 million per annum in interest charges would not do more than meet the cost of the unmet part of the Wilberforce settlement.

Despite these enormous advantages, more must be done. My right hon. Friend has made it clear that there will have to be a capital reconstruction of some sort and is examining ways of meeting the problems I have mentioned. For the hon. Member for Fife, West, to suggest that we should go on saddling the Coal Board with paying £10,000 to each miner who becomes redundant would be compounding these financial problems as well as setting up difficult comparisons with other industries.

My hon. Friend the Member for Bosworth (Mr. Adam Butler) was right to say that this settlement has placed extremely difficult problems in the way of the coal industry. Its competitive position is considerably impaired as a result of what has happened. Whatever the Government do—and the Government are examining these problems sympathetically—it cannot be assumed that the result will be that everything will go on exactly as before and that by a few debates in this House all can be put right.

I should like to say a word about redundancy, before coming to the question of fuel policy. The redundant miner gets his redundancy pay in the same way as does everybody else. He also qualifies for the pension scheme and he qualifies for the redundant miner workers' payment scheme as well. [An Hon. Member: "What pension scheme?"] The pension he gets if he is of pension able age. As I was saying, he also qualifies for the redundant miner workers' payment scheme which was approved by the House a few weeks ago and which gives him £3 which is based on an average of past earnings. This is the only industry that gets such a payment. That scheme was genuinely welcomed when it was introduced in the House not so very long ago. When I heard the hon. Member for Fife, West say that a miner who had been 40 years in a pit could end up with only thirty bob a week, I could not believe it. He would not have been able to get the redundant mineworker's pension unless he had started at the age of 14, in which case he would get it next year. The hon. Gentleman should take into account this generous scheme, which is far more generous than the E.E.C. scheme designed for similar purposes—[Interruption.] When hon. Members complain that the coal industry is not being well treated, they have only to compare it with the way in which other coal industries are treated.

I want finally to say a word about fuel policy implications. The hon. Member for Midlothian (Mr. Eadie) referred to the Chapman Pincher Report which I and my hon. Friend the Minister for Industry said that we had not seen until we had read about it in the papers. We still have not seen it, and I do not know of any of my right hon. and hon. Friends who have. I must dismiss it as one of those kites which occasionally fly over Whitehall.

Photo of Mr Harry Ewing Mr Harry Ewing , Stirling and Falkirk Burghs

If the hon. Gentleman looks in the same place as the recommendations for the U.C.S. were placed, he may find it there.

Photo of Hon. Nicholas Ridley Hon. Nicholas Ridley , Cirencester and Tewkesbury

I come, then, to the question of energy policy. There are a lot of new and difficult factors, as I said on 10th March, There is the problem of the security of North Sea oil and gas to which the hon. Member for Midlothian referred. However, I think that they are much more secure fuels than many others. Certainly Middle East oil lacks credibility in terms of price and security, but so does home-produced coal, after the events of the past few months. It must be regarded in the minds of customers as a much less secure fuel than it was. We already have some evidence of a desire to switch by customers of the coal industry as a result of what has happened.

The most dominant feature in the minds of customers is probably the price. Convenience is one. Security of supply is another. But price is certainly one. What is imponderable is what will the price of Middle East as well as home-produced oil and of nuclear power be, and what will be the price of coal, because coal has taken a large increase in price already. The prospects for each of these fuels has never been more difficult to assess. I remind hon. Members that we shall have to live with the decisions taken now perhaps for 30 years. Power stations which are commissioned five or six years ahead based on today's decisions will be in existence for another 25 years after that time. It is of paramount importance to give the Government time to make use of all these inputs so that they get the right answers when finally they make up their minds.

We take account of regional policy and regional unemployment even in calculations of this sort. There are about 115,000 of the Coal Board's employees situated in development areas—and I am talking not of intermediate areas but of development areas. That is obviously a major factor which must be taken into account in any review of these matters. What we shall not be able to do is to say, as the hon. Member for Ince (Mr. McGuire) requested, "This is the amount of coal that we want produced." The hon. Member for Carmarthen (Mr. Gwynoro Jones) gave the hon. Gentleman his answer when he did his survey of the new houses in the Wales Gas Board area, where he found that seven out of 10 consumers wanted gas and not coal. The hon. Member for Ince must tell his hon. Friend how to change this and persuade those who want gas that they should have coal. This remains a country where the consumer can choose the fuel which he wants to buy. If the Government, through their policy of controlling the fuelling of power stations, give an added advantage to coal, as they have in the past, that is only half the market. The other half of the coal market will depend upon its price, security of supply and the general convenience which its users find for it.

Photo of Hon. Nicholas Ridley Hon. Nicholas Ridley , Cirencester and Tewkesbury

No, I will not give way. I have just about finished.

At the end of the day we must all remember that it is the consumer whom we are trying to serve with our fuel policy. Whether it is oil, gas, nuclear or coal, it is not in itself an end. The end is to give the consumer the cheapest and most convenient fuel at the time, place and security of supply that he wishes.