I beg to move, That the Bill be now read a Second time.
I should like to say a few words to the House on the background to the Bill. Obviously I greatly regret having to come to the House with a Bill requiring the expenditure of £1,800 million. If further orders are taken, it may be as much as £2 billion. I regret it because otherwise it would have been possible to come to the House with a far more favourable report about the state of the coal industry.
I believe that 1984 could have been a year of very considerable opportunity for the coal industry. Many firms were considering the possibility, with the aid of Government grants, of converting to coal as a form of energy. My Department looked at the energy efficiency campaign and decided that a sensible target would be to try to persuade 1,000 firms in Great Britain to convert to coal. It was a year in which about £700 million to £800 million of capital investment could have taken place in the industry which would have increased performance and productivity and the prospects for capturing further markets. It was also a year in which we hoped that substantial progress would be made by the industry in reaching a break-even position and that it would no longer be a substantial liability for taxpayers.
I believe that the House should examine carefully the realistic opportunities and the downside risks that are involved in the industry. We have coal reserves which can be sensibly and correctly exploited, and a coal mining machinery industry which is a world leader. It faces competition only from Germany. As Germany's coal industry will probably decline, we have the opportunity to become a dominant force in the world's coal mining machinery industry. Therefore, the prospects are very good.
However, considerable improvements in productivity must be achieved. If one endeavours to look impartially at the last 10 years in the industry, before any strike action took place, the "Plan for Coal" contained three ingredients, only one of which was fulfilled, and that was the agreement by the Government—in the first place a Labour Government, followed by a Conservative Government—to invest substantially in the industry.
I make no party political point when I say that capital investment by this Government in the industry in both real terms and cash terms has been greater than that achieved by the previous Labour Government. It has been greater than the capital investment envisaged in the "Plan for Coal". The proponents and creators of the scheme considered that if capital investment were to be made at that scale over that decade it would result in an improvement in productivity of 4 per cent. a year. That was never achieved. For the 10-year period the total improvement in productivity was similar to the target for each year of the plan.
If those who are employed in the industry and if those who want the industry to be successful and to expand in the future are to have their hopes fulfilled, that will happen only if the industry uses the investment in it successfully and markets its products successfully. If it does so, I shall have great confidence in the industry. Therefore, I hope that trade unions and management will bear in mind that the best prospects for the industry lie in using the next two years during which this finance will be available to the best advantage of the industry, which means improving productivity and using the very substantial sums of money that are available to improve the performance of the industry.
The firm objective of the Government is that the National Coal Board must break even without deficit grant by 1987–88. That has been said in the past. Similar hopes have been expressed not only by Conservative Governments but by Labour Governments. It is absolutely essential for the industry to realise that, because of the sums of money involved, it is not possible for any Government, whether a Labour Government, a coalition Government or a Conservative Government, to continue to finance the industry at this level.
I am delighted to hear that this year the coal industry will at last make a profit. Since 1947 we have been promised that the coal industry would make a profit, yet each year—sometimes twice a year—we have written off thousands of millions of pounds here and hundreds of millions of pounds there. Does the Minister think that within the next three years there is any prospect of no taxpayers' money having to be put into the coal industry?
I should not have said what I have just said unless I believed that to be the position. It is in the interests of the miners and the mining communities to recognise that they are not being asked to make a great sacrifice but that they are being presented with an opportunity which will benefit them and the industry. It is essential for those who have in mind the best interests of the industry to recognise that fact.
Clause 1 provides for the payment of deficit grant to the National Coal Board—£1,200 million for 1984–85 and £600 million for 1985–86 and 1986–87 together. The latter figure may be increased, if necessary, to £800 million by order. Naturally I hope that no such need will arise. The provision of £1,200 million for 1984–85 is over and above the funds provided for that year under the Coal Industry Act 1983. We reached the limit on the deficit grant that we could pay in March; hence the immediate requirement for fresh parliamentary authority.
Total losses for 1984–85 are expected to exceed £2 billion, very largely due to the strike. The loss is still being added up, but at the last count no fewer than 71 coal faces—46 working faces and 25 salvage faces—had been lost, and 42—37 working faces and 5 salvage faces—were causing serious concern. The write-off of faces is costing millions of pounds. The recovery of faces, where recovery is possible, also costs many millions of pounds. Money is needed in the first instance not to make any real progress but to get the industry back to where it was.
Clause 1 also provides that, if the audited accounts of the NCB show that the full £1,200 million for 1984–85 is not required for that year, the balance may be carried over to 1985–86 and 1986–87. The reason is that it allows for present uncertainty about the proper allocation of strike-related costs and their amounts to be resolved when the board's accounts for 1984–85 are available and have been agreed with the auditors.
The board must operate within a financial framework. The subsidies to the industry in the past have been intolerable. However, there is a commitment in the industry to work towards new objectives. It is that commitment which counts and it must have the support of all, with a will to succeed so that the industry can become successful and solvent.
There will, of course, be pit closures. Since the strike ended there have already been some closures of pits where the majority of miners connected with them agreed that there was no likelihood that those pits could survive. There will be closures where it is the judgment of the board—and, I hope, the judgment of the unions—that spending money on pits that will contribute nothing to the future prosperity of an area is a mistake, not just for the industry in its collective form, but for the miners and their communities.
Essential closures will take place, but there will be substantial investment. Alas, part of the investment that would have been made in new plant and machinery and new coal faces will have to be spent on restoring some existing faces.
It is essential for the industry to recognise that the substantial sums that will be available over the next two years should be spent wisely and sensibly on projects that have a future and will provide jobs and opportunities for years to come and are not wasted. Therefore, I hope that when considering the closure of pits the three unions involved will be objective about where the available money can best be spent.
New procedures were agreed in negotiations with NACODS during the dispute. The existing procedures will be applied and if the unions and the NCB disagree on the conclusions there will be an independent review—as agreed with NACODS—before the NCB makes its final decision. When there is clearly no case for money to be spent on one pit when it could be better spent for the industry elsewhere, I hope that miners will not believe that it will be in their interests not to join the management and the NCB in taking rational decisions on such matters.
The form of the new procedures has not been agreed. Discussions are going on with the unions concerned. In the pits that have ceased to function since the dispute ended, the NCB has made clear to those affected the range of options available. It has said, "You can stay connected with the pit and the normal procedures will take place. If you take our view that there is no future for the pit and you would prefer to transfer now or to take voluntary redundancy, that can be done."
In a number of pits, the miners have decided to take that latter route. The procedures are still available. I believe that it is in the interests of miners and their communities to make such rational decisions. In Wales, NUM engineers went down a pit and agreed with the NCB that it had no future. The majority of miners also agreed. If the NCB had told miners that those options were not available and that men would be stood off for four or five months while the procedures were operated and the new procedure was agreed to, the majority of miners in that pit would have suffered.
I hope that the miners will show common sense. The NCB will not impose decisions. It will not say, "We are closing this pit and to hell with the procedures." It will tell the miners what it believes will happen to a pit and will ask them how they believe that the situation should be handled. Amicable agreements have been reached in a number of cases.
I have been encouraged by the increasing activity of NCB (Enterprise) Ltd. which was launched during the dispute. It has already made loans and given advice and help on a number of projects. It has generated 200 new jobs in mining communities and hopes quickly to produce another 400 jobs. An additional 1,000 jobs look like being in the pipeline.
I am told by the NCB that it intends to widen the scope of the company by bringing in a number of outsiders to help with such activities. I increased the loan capital for the company from £5 million to £10 million, and if further activity and expansion is found necessary I shall be happy to review the situation.
Within the context of uneconomic pits having to close, as they have had to close throughout history, I believe in the potential for success of the new company. There is no doubt that the prospects for young people in an area where an uneconomic pit must close will be far better if new industries come into the locality than they will if the district is left with an uneconomic pit that will not have a very long life anyway. We shall continue to be active and to endeavour to do what we can.
With the seams available and investment that we are willing to make, there is a good potential future for coal. However, there will be competition from other fuels which coal will have to win, particularly in industrial markets. Even during the dispute—and with more authority since it ended—my Department and the Ministers who have attended all the briefings on energy efficiency that we have provided have brought to the attention of 15,000 industrialists the grants and potential involved in using coal. We have suggested that industrialists should carefully examine the possibility of using coal, but that prospect will be of no interest to industrialists until they are sure that there is a guarantee of supply and that the investment will produce coal at reasonable prices.
Clauses 2 and 3 concern the power to pay pit closure grants to the NCB and to make payments to redundant mineworkers. The Bill does not affect the generous redundancy terms currently available to miners set out in the Redundant Mineworkers and Concessionary Coal (Payments Schemes) Order 1984, as amended. Also the Bill does not extend the period for which those terms are available, which remains 30 March 1986 as specified in the 1984 order. The Bill does not increase existing ceilings on total payments that may be made in respect of redundant miners and concessionary coal or in respect of the pit closure grants; they remain at £1,200 million and £400 million respectively.
Rather, the purpose of the Bill is to ensure that adequate powers exist to enable the continuation of the redundant mineworkers and concessionary coal payments schemes and to bring the scheme for the payment of pit closure grants into line with that proposed for the payment of deficit grants, and thereby avoid the need to burden Parliament with two coal industry Bills in one year.
My right hon. Friend has explained that payments of £1·2 billion, perhaps increased to £2 billion, can be made under the deficit grants scheme. Can he confirm that the Bill also allows up to £450 million for pit closures and up to £1,200 million—which may be raised to a maximum of £1,800 million—under the redundant mineworkers and concessionary coal payments scheme? Therefore, the maximum finance permitted under the Bill exceeds £4 billion.
No. The bulk of what is implied in clauses 2 and 3 and the £400 million—which could be increased to £450 million—is provided for in earlier legislation. The Bill allows that facility to be extended for a further year. For that to happen, however, an order would have to be laid before the House.
Now that the strike is over, the NCB must undertake a thorough review of the damage done and the options for the future. Many faces have been lost. At some pits there is insufficient work available for all men to return to normal working, and those who wish to leave the industry are being allowed to take redundancy. At other pits, area directors are coming to the conclusion that continued operation can no longer be justified and have instituted proceedings under the procedures laid down, which may lead to the closure of those pits.
It is too early to say what the final outcome of the board's review will be. The setting of figures for the Bill, alas, could not wait for the board's detailed assessment of its likely future manpower requirements and of the extent to which men might be willing to leave the industry on the terms available. The figures, therefore, had to be large enough to meet any conceivable circumstance.
However, the Government accept that it would not be right to increase the existing limits until a clearer indication of need emerges. That is why the Bill enables the limits to be raised by order approved by Parliament if and when that appears necessary.
The coal industry is of very important potential to the nation. The hon. Member for Bolsover (Mr. Skinner) refers to worthwhile investment. It is sad that the worthwhile investment of £800 million in capital investment did not take place last year. Instead, massive damage was done to the industry in a way that was entirely unnecessary and unwarranted and without any industrial purpose. As I said at the beginning of my speech, 1984 could have been a year of high investment, good pay, no compulsory redundancies and an increasing share of the nation's markets. Instead, it was the most tragic year in the history of the industry and I trust that it will never be repeated. I trust, too, that those working in the industry and all who wish it to succeed will take advantage of the Bill and will not waste and destroy the opportunities available.
As the Secretary of State said, the Bill gives us the opportunity to examine the financial arrangements proposed by the Government as well as the state of the industry following a dispute which lasted for more than a year. It is a shame that the Government have not responded to the real issues facing the industry as quickly as they have produced the Bill, but I shall return to that later.
The Secretary of State referred to the NACODS agreement and the colliery review procedure. I want to put some specific points to the right hon. Gentleman and to ask him some equally specific questions. Since the end of the dispute, and even before then, the Secretary of State, the Prime Minister and others have repeatedly assured us that the agreement signed by NACODS and the NCB is sacrosanct. On 17 April this year the Secretary of State wrote to Peter McNestry, the national secretary of NACODS, assuring him yet again that the NCB would honour the agreement and welcoming the impending meeting of the unions and the NCB to give effect o that agreement. On Monday the Secretary of State looked forward to yesterday's meeting to establish a new colliery review procedure and expected a speedy agreement to be reached on the operation of the new procedure.
In the meantime, we were led to believe that the existing consultation and review procedures for pit closures would continue to operate, but the NCB apparently does not share the Secretary of State's view. Since the dispute ended, pits have been closed without any consultation.
I was about to do so. If the Secretary of State will be patient, I shall tell the House about the closure of the Polkemmet pit in Scotland. I am sure that my hon. Friends will be interested to hear this, too. The Polkemmet pit is in the constituency of my hon. Friend the Member for Linlithgow (Mr. Dalyell). My hon Friend is unable to be present, but I have discussed the matter with him and with the Scottish secretary of NACODS, who tells me that the closure involves the loss of 1,400 jobs and a loss to the nation of 500,000 tonnes of coal per year, most of which is used by the Ravenscraig steelworks.
I hope that the Secretary of State will look into the details of this closure. I am informed that the power was switched off in that pit, leading to flooding, that valves were left open and that no attempt was made to recover the pit. [HON. MEMBERS: "Why?"] That is for the Secretary of State to answer.
That is not true. Safety cover was offered. The decision to close the pit in that way was taken by Mr. Wheeler, who urged people to take redundancy and then said that there was no one to take the jobs if the pit remained open. My hon. Friend the Member for Wentworth (Mr. Hardy), who speaks in the House for NACODS, can give chapter and verse on this. The agreement with NACODS was not honoured in this instance. That is a classic example of what has been happening since the dispute ended.
If the right hon. Gentleman had consulted the NUM instead of just talking to someone from NACODS, he might have been told that all but 19 of the 1,400 people at that pit had agreed to transfer or voluntary redundancy. There was massive consultation, and the picture that the right hon. Gentleman paints is totally misleading.
When NACODS saw the NCB about the future of that colliery, after it had been prevented from sending men down to deal with the flooding, which could have been done without any objection from the NUM, it was given a firm assurance by the NCB that when the dispute was over the pit would be pumped clear. No consideration has been given at Hobart house to that clear promise made to my association.
My hon. Friend has made that point clearly in answer to the Secretary of State—[HON. MEMBERS: "Unfair."] It is not unfair—the point was clear.
The Secretary of State referred to negotiations continuing. At the meeting yesterday, a request for an assurance that no pits would close without going through either the modified or the existing review procedure was rejected by the NCB. NACODS is extremely bitter about that. Peter McNestry told me only this morning that he and his chairman threatened to walk out because the agreement which had been signed, which the Secretary of State said was sacrosanct, had not been implemented.
It is even more extraordinary that the NCB is apparently refusing to accept that the principle embodied in the existing procedure should be incorporated into the new procedure. That principle is that while a colliery is under review there should be no redundancies or transfers, and that the status quo should prevail. That has happened in the mining industry over a number of years, but it is not happening now.
Will the Secretary of State, or the Under-Secretary, confirm that until the modified review procedure is set up the existing procedure will operate? Will they give an assurance that any pit which the NCB seeks to close will be subject to the existing or new procedures and that there will be no redundancies or transfers while the proposed closure is subject to the review procedure?
The NUM agreed to sign the NACODS agreement, but the Government refused to allow that—[HON. MEMBERS: "Answer the question."] I am answering the question. The procedure has been violated. I accept that the Secretary of State meant what he said about the agreement being sacrosanct, but he has been kidded by the NCB.
Does my right hon. Friend not find it strange that the Secretary of State is talking about the wishes of the majority of NUM members at one pit, when he ignored the wishes of the majority of NUM members who were on strike for 12 months? The right hon. Gentleman talks about ballots. Have the pits to which he referred held a ballot?
The Secretary of State is terribly confused about the review procedure. Rockingham colliery in my constituency went through the review procedure. During that procedure the men at the pit decided that the colliery would close and that they would either be made redundant or transferred to another pit, but that did not stop the review procedure taking place, nor did it stop those concerned accepting the view of the men.
I take my hon. Friend's point. The problems that exist, not only at Polkemmet but at many other pits, arise because there was no signed agreement to end the strike. Therefore, no agreement can take place against the background of the authority of an agreement. The Government and the NCB did not want an agreement, and that is the problem which the industry now faces. The Secretary of State did not face the realities of the position, nor did he face the facts put forward at the talks yesterday.
I deal now with the Bill—[Interruption.] We are talking about £2,000 million. We are talking about paying for redundancies and pit closures. I make no apology for my remarks in the debate. On the surface the Bill appears merely to extend the provisions of existing legislation, but a closer look at the possible intent and effects of the Bill gives us a clear idea of the Government's plan for the coal industry. The Bill adds £600 million to the redundancy scheme, making a total of £1,800 million. Nearly £615 million is already accounted for, but that still leaves more than £1,150 million. It is not unreasonable to assume that those figures have been arrived at by a projection of the number of people the Government hope will leave the industry. I calculate that that will involve the shedding of another 50,000 jobs at least, and possibly many more. An even more dramatic contraction can be envisaged by an examination of the finanial targets set by the NCB. To reach them, the NCB would expect to cut £650 million from its wages bill. That is the equivalent of about 65,000 jobs.
Further evidence that the Bill is designed to facilitate a rapid contraction of the coal industry is contained in the expected levels of capacity. The Secretary of State referred to the possibility of closures. The Government and the NCB have decided that during the next five years production should level out at about 100 million tonnes a year. From where will come the 130 million tonnes about which the Secretary of State spoke during the dispute? During the next five years, 25 million tonnes of new capacity will be introduced. Therefore, it is not illogical to assume that during the next five years 25 million tonnes of existing capacity will have to be shed.
The NCB has judged that 9 million tonnes of that will be from exhausted pits. What about the remainder? We are entitled to know the policy of the Government and the NCB and whether closures and redundancies will take place. On a straight profits-per-tonne analysis, the NCB could lose about 25 million tonnes by closing 69 pits, involving 67,000 jobs. We heard that argument during the dispute. Of course, the new capacity coming on stream will offset some of that, but Selby—which will produce about half of the new capacity—will involve only 3,500 jobs.
As if that were not enough, we have to face the EC plans, which were leaked to a German news agency. I have a copy of the memorandum but the House will recall that on Monday the Secretary of State implied that the leak had no basis. I welcomed what the right hon. Gentleman had to say and I have read carefully the report of what he said. He told us that he would wait to see what the Commission came forward with, but the memorandum tells us that the plans envisage a 15 per cent. reduction in the European coal industry, which will affect, basically, the two major producers, which are Britain and Germany. It appears that EC documents project job losses throughout Europe as a result of the reduction. Britain could easily lose between 60,000 and 70,000 jobs. It seems that it is proposed to lift import restrictions to make way for the importation of South African or Colombian coal into the United Kingdom. It is proposed also to eliminate all subsidies for the coal industry by 1987.
The Secretary of State told the House on Monday that as yet there were no definite Commission proposals. I hope that during his discussions at the Council of Ministers next month he will support the British coal industry by rejecting the proposals set out in the memorandum to which I have referred. I hope that, if necessary Britain will use the veto. We cannot have countries with no indigenous coal production dictating to Britain what it should do with its own resources.
It seems that plans and projections for the coal industry have been formulated by the Government and/or the National Coal Board and that no one has been told about them, least of all right hon. and hon. Members of this place. The Secretary of State has said that the coal board is making an assessment and has suggested that it is a comparatively short time since the miners' dispute came to an end. As soon as the assessment has been completed, the House is entitled to know the projections on which it is based and to debate it.
What are the coal board's plans? What size of industry is it aiming at? What is the estimated level of manpower and where will production be concentrated? Over the past 12 months the Opposition have made many speeches on the cost of pit closures to the nation and to communities. I do not intend fully to rehearse those arguments this evening, but it remains the case that the nation gains more if miners are kept in jobs than if pits are closed and jobs are lost. At a time of mass unemployment, the resources of the coal industry will not be used to create wealth for the nation elsewhere. They will remain idle, and nothing will be gained from that. Instead of the Government taking a negative view of the coal industry and thinking in terms of cuts, closures and redundancies, their time would be better spent seeking new markets for coal and expanding existing markets. If that were their approach, there would be even less justification for pit closures.
The Government should be seeking the expansion of the industrial market through the coal-firing scheme, which could provide a market for an estimated 6 million tonnes over five years. I hope that the Minister will confirm that the scheme will continue. Important areas of expansion for coal in the public sector are schools, hospitals, Government buildings and local authority buildings. If those areas were eligible for grants under the coal-firing scheme, there would be the possibility of a market for another 5 million tonnes. The promotion of the export market, especially in Europe, would similarly negate the need for pit closures.
Sulphur content limits have been set in some European countries, such as Italy and Sweden. Scottish and Welsh coal is low in sulphur content, and it should be promoted and marketed.
I met—probably the Secretary of State did too—Israel's Minister of Energy, who visited Britain a few weeks ago. He told me that he wanted to start to buy deep-mined British coal once more. Israel has the world market at its disposal, and I asked him why he wanted our coal. He told me that it was the best coal and, from Israel's point of view, the most economic.
Perhaps I have a more adequate answer for the Secretary of State. Perhaps my right hon. Friend should tell him that British coal is much cheaper than Slater-Walker was to British taxpayers. They had to bail it out for £110 million, when the right hon. Gentleman and his friends had been making money out of it hand over fist for many years.
I take my hon. Friend's point. If the market for coal were expanded by 15 million tonnes, pits would have to remain open to satisfy demand. The Opposition advocate that the Government should have a wholehearted commitment to gasification, liquefaction and combined heat and power. They should direct themselves to coal-burning power stations instead of turning their minds to the PWR system.
Finally, I shall deal with industrial relations. Over 700 miners have been sacked by the coal board. Reasons for dismissal have varied from area to area and there is no pattern or consistency. When Scotland is compared with South Wales and other areas, it is clear that there is an unevenness in re-employment and reinstatement. There must be direct negotiations between the various unions and the coal board, but they have not taken place. Why is it that not one of the 200 miners in Scotland—all those deemed guilty of some industrial misconduct or charged in the courts—has been reinstated?
The branch secretary of one of Scotland's largest pits was dismissed on 11 September 1984. On 27 November he was tried at the Edinburgh sheriff court on a charge of having assembled with others inside the gates of Bilston Glen colliery and having refused to move when requested to do so by the police. He was charged with having committed a breach of the peace, but the charge was found not proven. What right does the coal board have to instigate its own form of justice when the courts have decided that the case is not proven? I am aware that my hon. Friend the Member for Ogmore (Mr. Powell) can give other examples.
I know that a Labour Government introduced that legislation. If someone goes to an industrial tribunal and wins his case, he may receive some compensation, but he will be finished with mining for the rest of his life. Why should the coal board institute its own procedures when someone has been before the courts and his case has been found not proven?
It appears that Mr. MacGregor would like to introduce American-style industrial relations and mining techniques into our coal industry. Recently he wrote an article about mining practices in Mining Engineer, which is a professional journal in America, and NACODS fears that the NCB plans to introduce American methods into the deputies' areas of work, to reduce manning levels underground and to cut statutory safety standards. Will the Secretary of State assure us that present safety standards will be maintained? We are entitled to know.
The Secretary of State talked about co-operation. We want co-operation in an expanding industry, which will involve the Government as well as management and the unions. Britain urgently needs a coherent energy policy, not a mass of redundancies and privatisations. The coal industry today is a sad spectacle. The Government should set up a tripartite meeting to consider a new plan for the coal industry, to solve the crisis in industrial relations and to set the industry back on the road to growth.
We give the Government notice that we shall not stand idly by if pits are closed and there are massive redundancies. That is not the future of the industry. We believe in an expanding and developing industry.
Tonight my right hon. Friend the Secretary of State for Energy unveiled the latest chapter in the coal industry's need for money. I welcome his statement and endorse his commitment to the long-term prosperity of those who work in the industry. Again, this illustrates and supports the evidence which is available for all to see that the Government, more than any other, have supported the coal industry and will continue to do so. For example, if we compare capital investment between 1983 and 1986, the United Kingdom spent £3,000 million, Germany spent £800 million and France spent £150 million. The figures speak for themselves.
During a debate on the Coal Industry Bill on 15 November 1983, my right hon. Friend the Secretary of State said:
I do not envisage the board's need for support ending after two years, but it will be timely when new provisions are laid before this House in two years' time for the Government and the House to review the board's progress up to that point.
—[Official Report, 15 November 1983; Vol. 48, c. 737.]
It is only 18 months since then, and the progress of the industry, solely because of the machinations of Arthur Scargill, can be described only as an unmitigated disaster for the miners and the country in general.
No one in his right mind could have predicted the events of the past 18 months, yet one man was busy putting the final touches to his attack on the democratic process of his union so that his desire for the downfall of the Thatcher Government could come to fruition. If proof of that were needed, it was in the movement of his union's funds three days before he instructed the Yorkshire area of the union to confront the board at Cortonwood, and also in the speed with which he organised and dispatched his hordes of bully boys to the areas that defied him. He makes Genghis Khan look almost like a saint.
Has the president of the NUM, in the interests of the industry, his members and job opportunities for the unemployed, decided to co-operate with the board? So far there is evidence only to the contrary. A Marxist entrusted with a mission that fails is more dangerous when given a second chance. His new orders, which he received on a recent visit to Moscow, have been published. They are completely to rewrite his union's rule book, which will enable the red army to march again. It was probably just a coincidence that that happened at the moment when an Opposition Front-Bench spokesman announced in the House that they would rescind the laws on union democracy enacted by this Government. If that happened, it would deny trade unionists the right to hold ballots, an example of which is the ballot that Nottinghamshire miners will hold soon to oppose the proposed changes in the national rule book.
What the coal industry requires for a successful future is the confidence of its work force and of its customers. Without both, the £2 billion expenditure being approved tonight will be but a drop down the pit shaft. The confidence and morale of the men can be assured by the board's investing in new pits, and the announcement of a new pit would nail the lie that the coal industry is on the way out. For those miners who put the industry before Scargill's politics, that would be the bonus of loyalty about which everyone spoke during the dispute. The sum that we are talking about tonight would be equivalent to the opening of five new pits with a combined output of 10 million tonnes of coal, at a cost of £25 a tonne, and the creation of 5,000 jobs.
I wish to draw my right hon. Friend's attention to what is happening in the Nottinghamshire coalfield——
As a result of the harassment of miners and their families, miners from all the English and Welsh coalfields, but especially from south Yorkshire, are transferring to Nottinghamshire pits. It is difficult to establish the total, but informed sources put the figure at 500—or 501 if we count Albert Wheeler.
That influx of highly regarded miners has raised some unanswered questions. The principal one is: what about the need and right of Nottinghamshire miners' sons to jobs in the Nottinghamshire coalfield? To defuse what could become an untenable position, the NCB should announce a starting date for the new Witham project, which is situated on the east side of Nottinghamshire, next to three 2,000 MW power stations. That would create substantial savings in the transportation of coal to the power stations and completely absorb the new arrivals.
The generous voluntary redundancy scheme, which will be extended to 29 March 1987, is welcome; but to overcome the uncertainty beyond that period, talks on a permanent formula for early retirement at 55 based on the number of years' service should begin. Without that, many highly skilled miners will opt to leave the industry before the end of March 1987 to take advantage of the present scheme.
The confidence that industrialists require from the NCB is continuity of supply at a price which makes their products competitive. The example of ICI's faith in converting its boilers to coal-fired is one that many should follow. The commitment given by the Secretary of State to support the conversion programme should also stimulate companies in that direction.
Efficient coal production starts with management, and the board's decision to streamline the administrative areas and to bring its operational and technical services personnel to Nottinghamshire is only a start. Those who run the industry should be seen in the coalfields, and the transfer of all but a few from Hobart house to the various areas would bring renewed confidence to those who mine the coal. They could then see that decision-makers are human beings, too.
The coal industry has just weathered a disastrous storm and the taxpayers are putting up a further £2,000 million to meet the expected revenue deficits for this year and the two following years. In the interests of those who support the industry, let us hope that common sense and purpose will prevail among those who work in and run the coal industry before there is a strike by taxpayers.
One reason why a debate on the coal industry at this time is so important is that what happens in the few weeks after the end of a strike may be even more important than what occurred in the strike itself. The bitterness that can be created in the period after the ending of a strike may have its repercussions for years to come. That is partly what we are debating.
It is evident from the debate that my right hon. Friend the Member for Salford, East (Mr. Orme), who showed an acute awareness of what was happening in the coalfields during the dispute, seems to have much greater awareness of what is now happening on the ground—or even above the ground and underground—than the Minister. However, that is not exactly a novelty.
Some of us can recall what happened after the 1926 strike. The cold vindictiveness shown after that strike left traces in the industry for a much longer period and was felt even more than what had occurred in the six months of the strike itself. Eventually the trade union movement earned out the pledge that it gave at the time, that it would remove the vindictive legislation and the action taken by the Government. Just as those vindictive measures had to be overcome, although it took a long time, so the same will happen now. It may take a long time, but the Government should begin to understand the mood in the coalfields
At a party meeting a few weeks ago a remarkable speech was made by my right hon. Friend the Member for Wakefield (Mr. Harrison), who gave an account of what had happened after the 1926 strike and of what people had sacrificed then. He quoted the case of Bill Blyton, now Lord Blyton, who was a respected Member of the House for many years. He still plays his part in guiding these affairs. The general strike left Bill Blyton with debts that took 20 years to pay off. Before the strike, as a miners' union official, he had been one of the guardians of the old poor law assistance, but during the strike he and his wife, who died in 1971, had to apply to the guardians for help. He had to pay back sixpence a week over 20 years. When he became a Member of Parliament in 1945, he received a letter from South Shields telling him that he still owed £7 2s 6d, so for the first time in his life he sat down and wrote a cheque. Such was the legacy of the 1926 strike.
In the mining communities today there are multitudes of families bearing heavy burdens. It is the duty not only of the Labour movement and the trade union movement to come to their aid, but of the Government to do everything in their power to change the atmosphere in which these matters have to be dealt with.
I know that when I say what I am about to say there may be problems and some people may say that it is counterproductive to mention it, but it has to be said. I do not believe that Mr. Ian MacGregor is fitted to do the job of chairman of the coal board.
Indeed. This is not hindsight. Some of us remember what happened in the steel industry, when we bitterly protested against the appointment of Mr. MacGregor, and particularly the absurd financial terms that were arranged. We bitterly protested because it was an insult not only to the workers but to the managers in the steel industry. There were plenty of managers in the steel industry who were capable of doing that job. Instead of that, MacGregor was brought over from America and put into the job at huge cost. Far from his contributing to great advantage, all that he did was to cut and cut. When he carried out wise measures, they were mostly measures that had been arranged by previous managers.
I wrote to the Minister at the time, so anxious was I to avoid what might occur under MacGregor-type management. I urged that somebody else be appointed. There were quite a few others who supported the Conservative party who could have been put into the job. However, the Government would not accept that advice.
During his time in the steel industry, Mr. MacGregor quarrelled with Mr. Bill Sirs, just as strongly as he did with Mr. Arthur Scargill. The bitterness in the steel industry and among the steelworkers about the way in which MacGregor went about his task still rankles in every steel area in the country. After that, for Mr. MacGregor to be transferred to the coal industry was a monstrous act by the Prime Minister. I imagine that it was imposed on the Ministers in charge. I do not suppose that any of them was in favour of it happening, and certainly the coal board was not.
What has happened since? A large part of the responsibility for what has happened during this terrifying year rests directly at the door of Mr. MacGregor. The whole of that catastrophic strike could have been avoided. My hon. Friend the Member for Wentworth (Mr. Hardy), who represents Cortonwood in the House, and who represented it so well throughout the bitter dispute, has given chapter and verse of how it could have been dealt with differently if the coal board had wanted it or even if the procedures prevailing in other coalfields such as south Wales had been applied in Yorkshire. All of it could have been avoided. But MacGregor was appointed to have a fight, and he thought that he would win it much more easily.
What did Mr. MacGregor say during the strike? Whenever there was the possibility of a sane arrangement or an understanding that could be sensibly reached, he would make a statement that wrecked the possibilities. I remember when he said, "We shall have a new system of management in the coal board. We must re-establish the power of management in the board." That was an insult not merely to those who had been negotiating with the management in the previous period, but to the managers themselves, including Sir Derek Ezra. Almost every utterance that MacGregor made about the way in which the industry had been run before was an insult to Ezra and the way in which he had done it. But Ezra was devoted to the industry and showed much more sense about the way in which it should be run.
Having spoken about the vindictiveness of the Government and the way in which Mr. MacGregor has behaved, will the right hon. Gentleman explain why, under the Labour Government, when he was a Minister, no redundant miner under the age of 50 received any capital payments, whereas under the present Government, whom the right hon. Gentleman has so heavily criticised, a 49-year-old miner with 33 years' service is eligible for redundancy pay of £36,000?
If the hon. Gentleman paid a little more attention to these matters, he might learn a little more.
I accept full responsibility for everything that was done. We settled such disputes by intelligent discussion with the trade unions, and in that way this dispute could have been avoided. My hon. Friend the Member for Midlothian (Mr. Eadie) was tireless in his efforts all over the country to ensure that the agreements made under the "Plan for Coal" were properly and faithfully carried out. But MacGregor said, "The 'Plan for Coal' does not mean anything. It has been cooked up by a lot of civil servants who did not understand what they were doing." Many Ministers and miners understood what they were doing. On the basis of those agreements, we were able to proceed to expand the industry, with a good future for it. If those agreements had been faithfully carried out, we could have avoided the dispute.
Mr. MacGregor's attitude to the steel and coal industries seemed to be, "I'm not bound by anything that may have been done by my predecessors. I have been put in here to do a special job, and whatever the British Steel Corporation or the National Coal Board may have agreed before, that is not my business." Of course, one cannot conduct great industries in Britain like that. One may be able to do it in some outlandish parts of the United States, but it cannot be done here.
It was not only the managers of the industry with whom MacGregor quarrelled. We should discuss in the debate what has happened in the coal board. It has been in chaos for much of this period——
The Minister shakes his head. He had better talk to Mr. Ned Smith or Mr. Geoffrey Kirk, who know much more about the coal industry than he does. They devoted their working lives to the industry, but they found that the method that MacGregor was using was so intolerable that they were forced to leave or be slung out. Either way, it was bad enough.
After the strike, in an interview with Mr. MacGregor, Mr. Graham Turner, a reputable reporter, who I imagine is a supporter of the Conservative party, asked:
in the long battle with the NUM, who had been tougher, himself or Mr. Peter Walker, the Energy Secretary?
Mr. MacGregor answered, according to the article,
'Why do you mention him? … Mr. Walker had nothing to do with it. All the decisions were taken here, in this room'. He looked to Cowan for confirmation. 'I certainly don't remember anybody else being consulted', agreed Cowan.
Is that the truth? I do not believe that it is. I have always believed that the Government intervened in the dispute. For a few weeks the Prime Minister said that there was no Government intervention, but we all knew that to be false. Government intervention was exposed and everyone knew that the Government were meeting every week and almost every day to discuss strategy.
Mr. MacGregor wanted to establish some authority. He claimed that every decision was taken by him and Mr. Cowan and that the Government had nothing to do with the dispute. I do not expect Ministers to accept that.
I am sure that the Minister could say something much more insulting about Mr. MacGregor than I have dared to say because the Secretary of State was told by Mr. MacGregor to clear off. He told the Secretary of State, "We don't need you. We have done it our way." Perhaps he did everything his way and perhaps that was why everything was so catastrophic.
To do the Minister credit, I believe that if Mr. MacGregor had not been there, or if he had had the guts to go to No. 10 and say, "We must get rid of this fellow because he is causing such trouble to the country and the industry", he could have saved a whole heap of trouble. If he had done that, a proper negotiated settlement could have been achieved earlier.
Either the story about Mr. MacGregor's relationship with the Ministry is true or it is untrue. If it is true, it is a gross reflection on the way in which the Government have dealt with a great national industry at a time of crisis. The Government have a right and a duty to instruct a board of that nature when it is engaged in such a dispute, particularly when the board is so incapable of conducting industrial relations on an intelligent basis.
It is possible that the Government did not intervene and that the story is true. The other possibility is that Mr. MacGregor is telling a complete falsehood and that the Minister intervened by choosing sometimes to accept advice and sometimes to brush it aside. What a way to run an industry. What a way to deal with an industrial dispute. It is intolerable that the dispute should have been conducted in that way. We now have to clear up the consequences and to deal with all the individual disputes.
Most coalfields are now involved in disputes about civil liberties. People have been treated differently in different parts of the country. All the difficulties have been dealt with in different ways in different pits.
I do not wish to take away the power of the managers in the pits because they are capable of bringing some intelligence back to the industry, but when regional managers start to make intelligent attempts to solve the problems created in the aftermath of the dispute Mr. MacGregor says, "No. You cannot do that. If you do, you will be pushed somewhere else and will not be promoted like Mr. Wheeler." I know that some terrible things have happened in Nottinghamshire, but no one deserves Wheeler whatever they have done.
I hope that the Government will pluck up the courage to say how grossly mismanaged industrial relations have been in the industry. The Minister should ensure that the problems are dealt with, in the interests not only of the country but of the proper civilised treatment of great communities in our country. The mining communities must not be destroyed.
One of the ways in which the Secretary of State says that he will solve the problem is by encouraging new enterprises. The irony is wonderful because the Labour Government set up such an organisation to operate in the steel areas. We set it up on a proper basis. Ebbw Vale received more money than the Government now propose for the whole coal industry. That area needed every penny. Today that sum is chickenfeed. Over three or four years the area received about £15 million and then another £15 million. In addition, there was new investment. If £60 million or £70 million had not been invested in the tinplate industry, that industry would have been wiped out. In those difficult years we introduced an expanding investment system. We cannot operate on a tuppenny-ha'penny basis.
Investment in the steel industry has brought great benefit. New industries would have been impossible without the expertise, money and financial support of the British Steel Corporation. That process was begun by discussions with Mr. MacGregor's predecessors. When Mr. MacGregor joined the British Steel Corporation, he said that the industry had to be run down and that we should leave it to the Government. He said that the Government should put up the money. He said that the steel corporation could not be engaged in such activity. To anyone who says that Mr. MacGregor will clear up the mess I can point only to experience.
The Government must take back the £5 million or £10 million and introduce a scheme that will bring a whole range of new industries to the coal mining areas. They must ensure that the rundown of the pits that must go in the end is done at a proper pace when the whole apparatus is in working order. That is the way to do the job. That is what the Government should be saying they are doing today.
We are assembled to go through a depressingly familiar ritual which occurs each year. We hear from the Government Front Bench how the problems of the coal industry are exceptional this year and that exceptional measures are required. We hear how the current measure will last for the next two or three years. We hear that at the end of that period it is hoped that the NCB will be able to balance its books.
From the Opposition Benches, we hear a series of depressingly familiar speeches year after year. The Opposition resist rationalisation in the industry. They resist the attempt to make the industry financially viable. Year after year, they defend the past and seek to maintain the status quo.
The House is apparently expected to accept the same thing year after year. I do not intend to go back over the past, but perhaps we should dwell for a moment on what has happened merely since the general election. In November 1983 we were asked to sanction a sum of £650 million for deficit and social grants for that year. Incidentally, that sum was equal to £50 a week for each person employed in the coal industry. At 1983 rates, that sum approached half the average weekly wage in the industry. That money was paid through subsidy by taxpayers, the majority of whom earned less than those whom they were subsidising.
In November 1983, a little less than 18 months ago, the Government told us that the NCB's estimated loss for the year would be £200 million. That did not last very long. Practically a year to the day later, 26 November 1984, we undertook the ritual once again, except that the figures had altered. We were told that the deficit could not exceed £1·2 billion and might perhaps by order be allowed to rise to £2 billion. We were told that that amount would last some considerable time.
In May 1985 we are going through the ritual again. This time, the figure is £2·6 billion. The figure had doubled in 1984 and doubled again in 1985. There has been a fourfold increase since the general election.
These are massive sums of money. Let us try to put them in perspective. They represent a forced tax of over £110 a year on every worker in the country—or, in other words, over £2 a week in extra taxation. What we are being asked to sanction tonight is that every worker should pay to subsidise those in the coal industry, who earn higher than average wages. Those on lower incomes are being asked to subsidise them.
The figures that the hon. Gentleman gives are relatively small when compared with the subsidies that are forced out of us for the farmers, who are substantially richer than the people to whom the hon. Gentleman refers——
I include my hon. Friend the Member for East Lothian (Mr. Home Robertson).
With the one notable exception of my hon. Friend, many of the farmers who receive substantial amounts from the taxpayer are represented on the Government Benches and, indeed, in the Cabinet. Why is the hon. Gentleman so selective? Why does he deal only with a subsidy to the coal industry, when subsidies to the farmers, many of whom are millionaires, are much greater?
The House is not being asked tonight—[HON. MEMBERS: "Oh."] I would be called to order if I responded to the hon. Gentleman's question. The House is being asked to approve a massive sum for the coal industry. It is interesting that the Opposition regard that as a relatively insignificant sum. [Interruption.] The hon. Gentleman used words to that effect. We shall have to read Hansard tomorrow.
The extra tax of £2 a week on every worker in the country to subsidise the coal industry workers is having to be paid by all those trade unionists who refused to support the mine workers in their strike. The electricity workers, the steel workers and a host of other workers refused to come out in support of the mineworkers, yet tonight the House is being asked to tax those people who refused to support the mineworkers by a compulsory levy of £2 per week.
The hon. Gentleman is regaling the House with statistics. Part of this large and important sum of money is to help meet the cost of the miners' strike. I have worked out that the cost of the miners' strike, according to the Government's figure of £6,500 million, is £32,500 for every person engaged in the coal industry. The point that the Opposition are making, and were making before the strike started, is that it would be highly desirable for the nation to avoid that massive expenditure.
Indeed, it could have been avoided if the miners had been allowed a ballot. This massive sum works out at £16,000 per worker in the industry, and that is under this year's measure alone.
The House and, indeed, my hon. Friends have been through many traumas because of the proposed cuts in Government expenditure for relatively piffling amounts as against the sum that we are being asked to authorise tonight—a cut in parental grants for education, a cut of £75 billion in regard to generic prescribing and a host of such measures—yet in one three-hour debate on Second Reading of a Bill that was introduced only on Thursday last week we are being asked to approve a compulsory taxation on every worker in the country totalling £2,650 million.
Given the Government's regional policy and the objective of seeking to direct industry to the north of England and other places of high unemployment, I suggest to the Ministers concerned that there is no case for continuing to subsidise one industry in the south-east, namely, the coal industry. There is no case for continuing to subsidise the Kent coalfields. They are in the south-east of the country in which no other industries are allowed to set up and receive subsidies. In accepting this measure, we will be continuing to support that industry.
My right hon. Friend the Secretary of State, in introducing the measure to the House, said that this level of subsidy to the coal industry in the past has been intolerable. I agree with the Secretary of State that this level of subsidy has been intolerable. The level now proposed by definition must be even more intolerable.
In my opinion, this Coal Industry Bill is no different from previous coal industry legislation introduced by the Government and it will probably be no different from any future coal industry legislation that may be introduced by the Government.
The Government have declared their firm intention that the coal industry should break even by 1986–87. They say that they want to bring down the cost of coal to help industry. I do not believe them. The whole idea of the Coal Industry Bill, as with previous, and no doubt future, coal industry legislation, is to make the industry break even so that the Government and the National Coal Board together can sort the wheat from the chaff and close the uneconomic units, after which they will prepare the industry for privatisation.
The Minister, I note, shakes his head. I am pleased that he does, because I intended to ask him whether he would deny this when he winds up the debate.
I am grateful for the Minister's advance notice.
I hope that I am not being unparliamentary when I say that I just do not believe the Government. The thousands of millions of pounds that the Government boast they are investing in the industry are being invested for one reason only. The Government are involved in asset-stripping and closing down pits in order to prepare the industry for privatisation. The amount of money about which the Government have boasted pales into insignificance when one considers what it has cost them to beat the miners in the recent dispute. That strike was caused deliberately by the Government when they announced five pit closures without any prior consultation. The amount of money that it cost to win the Falklands war was peanuts compared with what the Government were prepared to spend to beat the miners.
The Secretary of State spoke of the loss of coal faces. I am more concerned about the loss of pits, because the first closure to be announced after the strike ended was Ackton Hall colliery in my constituency. That colliery is the life-blood of Featherstone, and we are concerned about what will happen to that community when the pit closes in a few months' time.
It is said that if Featherstone Rovers needs footballers, one need only whistle down the shaft and up will come players good enough to go straight into the first team. I am proud of that because I am a vice-president of Featherstone Rovers, and we have not had a bad season. We finished ninth in the league, and we had no crowd trouble. We do not need an electric fence. I point out to the chairman of Chelsea that last February an electrical fault was the cause of Featherstone Rovers' grandstand being burnt down. There must be a moral there.
I am particularly concerned about job opportunities for the youngsters of Featherstone when the colliery has closed. The men will be transferred. Those under a given age will be found jobs at other collieries. Fortunately, Featherstone is only a dozen or so miles from the Selby complex.
What will happen to the youngsters of the area? It is all very well for the Secretary of State to talk of the enterprise scheme and how 200 jobs have been created as a result of it. When the Ackton Hall closure was announced, I made inquiries of the NCB about the enterprise scheme, and the details that I was given were confusing. In any case, £10 million is inadequate to make up for the jobs that will be lost in mining areas such as Featherstone, Hemsworth and South Kirby. A total of £10 million will be only a drop in the ocean. Far more jobs are being created by the efforts of local authorities.
I urge hon. Members to take care lest they think that the enterprise scheme is designed to hand out money for the provision of jobs. I have a letter from the chairman of the NCB which makes it clear that the money will be given in the form of a loan. Not many jobs in areas such as mine will be created simply by money being loaned. We need real aid, and £10 million will go nowhere towards solving the problem.
The Secretary of State referred to the need for "rational decision-making." We cannot divorce this debate from the recent dispute. The right hon. Gentleman can talk all he likes about the need for the NCB and the NUM to reach rational decisions together, but in the present climate rational decision-making is an impossibility. That is a pity in view of the good will that was built up in the coal industry since nationalisation, and a great deal of good will was needed.
Nor should Conservative Members refer to clap-trap about the bad old days being uttered from these Benches. I lived through those times.
My right hon. Friend the Member for Blaenau Gwent (Mr. Foot) talked about Lord Blyton paying his debts. I know all about that, because it happened to my own mother, who was widowed in 1926. My father died of a broken back in a pit accident, but his rent book was never changed. My mother went to court after the strike to be charged with owing rent. When my father's name was called, she stood up and said that she was there to reply. She was told that there was no case against her, but she said that she wanted to pay all the money that her husband owed on the rent book. It took her until 1945 to pay off at sixpence a week the sum imposed by the court.
Does the hon. Member accept that those miners who have incurred debts as a result of the recent strike had no opportunity whatsoever to decide whether they wished to go on strike? They were forced to incur those debts because they were forced out on strike without a ballot.
The hon. Gentleman has overlooked the fact that I am a Yorkshire miner. The strike started in Yorkshire and it was virtually solid to the bitter end. A ballot was held in Yorkshire, and permission was given to the Yorkshire executive committee to call the men out on strike if any pit in Yorkshire was closed for a reason other than seam exhaustion. The ballot was taken in 1981 and 84·6 per cent. voted in favour of strike action. When it was decided to close Cortonwood without prior consultation, the Yorkshire miners to a man walked out and remained out until the end of the dispute. All this claptrap about not having a ballot is a load of nonsense.
It is all very well to talk about rational decisions, but they have gone for good. The good will and the open-door policy which were manufactured, worked and slaved for and brought about men such as Arthur Horner, Will Paynter, Joe Gormley, Lawrie Daly and Lord Ezra, Ned Smith and Geoffrey Kirk on the board side have now gone. Instead of our having an open-door policy, the door is now, and is likely to stay, firmly locked, bolted and barred.
This week a strike started at my old colliery, the South Kirby colliery, where I worked before I came to the House. Four men were sacked. Their crime was vocal intimidation. I spent six and a half years in the army during the last war and I found that there was a crime called dumb insolence, and my God it was a terrible crime. One smack in the face by dumb insolence and we saw stars. Here we have four men committing a crime that is far worse—vocal intimidation. If grown men cannot fall out and have words, whether it be about Steve Davis and Dennis Taylor, Everton and Manchester United or Arthur Scargill and Ian MacGregor, without getting sacked, where the hell is the industry going?
It is all very well to talk about rational decisions. I have here a newspaper which was sent to me this week. I do not recommend it to anybody, but I want to point out a headline on page 3—"NCB's duty to heal wounds."—[HON. MEMBERS: "Hear, hear."]—Yes, "Hear, hear."
How can wounds be healed when, as soon as the strike is over, the National Coal Board decides on a policy of reorganisation and promotion and the men who are promoted are the hardliners—those who have issued dismissal notices to men without any thought of giving them back their jobs. Yet we are talking about rational decisions.
At practically every pit in my area the local branch officers, who have to deal on the spot with any dispute that might occur, have all been told, since the strike ended, that they have to take backshift work, work afternoons, nights, and all the hours of the day. Normally they were on regular days so that they could be present and meet management to talk about the disputes which crop up day by day—probably nipping many little disputes in the bud. They have all been put on regular rota and backshift work, which makes it virtually impossible for any pit manager to call on his branch officers and get a reasonable decision or to talk about any possible dispute. That is why South Kirby colliery is now out on strike and calling for the rest of Yorkshire to come out. Four men who had a vocal punch-up at a bus stop have been sacked. Yet people are talking about coming back to the making of rational decisions.
I am worried about the coal industry. I worked in the pits for most of my life. I started when I was 14 years of age. I left the industry to come to this House in 1974 I have been a member of the union ever since I started work as a boy. I served on the consultative committees and worked through my branches to make my pit a happy pit. There is no such thing today as a happy pit, and there is nothing in the Bill to make any pit happy. The Bill is inadequate. There is nothing in the Bill to improve industrial relations.
I should like to know why there is no mention in the Bill of the enterprise scheme. [Interruption.] Something needs to be in the Bill if we are to help areas in which pits are being closed.
There is no one in the House with his ear closer to the ground than mine in mining areas. I speak as a practical man. There are nine pits in my area and I know the officers of every one of them. I know the feelings in every one of them. It is no good talking about getting back to normality. At the present time that is impossible. The Government are to blame for that, and I do not take any joy in having to say it.
It is no use Conservative Members paying lip-service to the coal industry. We are wise to them. The Secretary of State for Transport let the cat out of the bag. The only sympathy that Conservatives have for the coal industry—if it can be called sympathy—is related to getting the industry on to a rational, saleable footing, so that it can be sold off. Bit by bit they will get rid of it. Pits that cannot match up to the Government's economic considerations will go by the board. There will be more closures, there will be more job losses, and there will be more unhappiness in pit areas such as mine.
I take no joy in having to state the simple truths about what people think in areas such as mine which depend on coal. We have depended on coal all our lives; it has been our life-blood. The Government are going to drain the life-blood out of us. Shame on them for it.
I have listened to the debate with growing astonishment and wonder. When the right hon. Member for Blaenau Gwent (Mr. Foot), as befits a distinguished historian and essayist, took us on an excursion into the past, my wonder increased. The hon. Member for Hemsworth (Mr. Woodall), in the latter part of his speech, gave a spirited defence of intimidation, and increased my astonishment further.
It occurred to me to speculate on what a casual visitor to the Chamber, who did not know what the Bill contained, would think we were talking about. We had wonderful sentimental phrases from the right hon. Gentleman about "this great industry of ours". In what I hope was a slip of the tongue he referred to "this great industrial dispute of ours". It was an unfortunate slip of the tongue. When we refer, in a slightly sentimental way, to this great industry of ours it is salutary to remember, as we were reminded by my hon. Friend the Member for Ludlow (Mr. Cockeram), who injected a welcome measure of common sense into the debate, that we are referring to an industry which costs the taxpayer every year well over £1,000 million. This Bill will enable a further £2,600 million to be paid to the coal industry, yet the Opposition would have us believe that this is a wicked measure which will allow the great coal industry of Great Britain to be sold to Taiwan. Instead, it will enable an enormous amount of money to be levied from the taxpayer and paid to a bankrupt industry in order to keep a large number of men in work.
As Mr. Speaker reminded us yesterday, the House of Commons has the sole right to levy taxes in this country. Therefore, it behoves us to remember that this represents a levy on every taxpayer in the country of £2 a week in order to sustain the industry. When I hear the hon. Member for Hemsworth say that we are paying lip service to this industry it annoys me. If £2,600 million is paying lip service to the industry, Heaven help us when we actually get down to business.
The hon. Member has referred to the cost of this industry to the country. Does he realise that from the day that the very first sod was cut the Selby complex cost £2 million a week? That continued for three years before a single nut of coal was mined. Money is invested in the mining industry and the return on the investment comes later. But the Government intend to sell off the industry.
I shall ignore the last part of the hon. Gentleman's intervention, a leit motif that ran through his speech which is wholly irrelevant to the discussion of the Bill. Instead, I shall concentrate upon the substance of his intervention. He referred to the public money that has been spent upon developing Selby. That is investment and is wholly separate from the sums of money with which we are dealing. We are dealing in the Bill with a subsidy for revenue deficit and with various other revenue subsidies. We are not dealing with capital. Capital is in addition. When the hon. Gentleman refers to Selby he ought to sort out the difference between capital and revenue. I do not think that he is clear in his own mind about the difference between the two. We are talking about a vast sum of money which makes investment in a number of other industries seem insignificant. My hon. Friend the Member for Ludlow told us that over the last three or four years the amount of money needed to sustain coal miners in work has doubled every year.
The hon. Gentleman refers to the pits in Warwickshire. I represent, as does the hon. Member for Hemsworth who preceded me in the debate, a coal mining constituency. I shall deal later with the Warwickshire aspect of the industry. My right hon. Friend the Secretary of State for Energy expressed the hope and the intention that by 1987 the coal industry would break even. I am sure that I am not the only hon. Member who has heard those sentiments expressed on previous occasions. One might call them pious hopes. However, every 18 months or two years a similar Bill is introduced.
I believe that I am not alone in thinking that the coal industry will start to break even and seriously address itself to the problems of losses, uneconomic capacity and subsidy only if it is told that in 1987 the tap of public subsidy will be turned off. That would concentrate the minds of all those connected with the industry, including managers, deputies, miners and, I hope, hon. Members who have the honour to represent coal mining areas.
No. I make no apology for that reply, because I am an hon. Member, not a coal mine manager, and it is for those who are employed to manage the industry to decide what is economic and what is uneconomic.
I know about the argument that the hon. Member for Barnsley, West and Penistone (Mr. McKay) would like to adduce, namely, that it is not always a straightforward matter to decide which mines are economic. Of course, it is a difficult decision, but the House raises the money to pay for the losses and we can see that the industry as a whole is grossly uneconomic. That problem must be addressed quickly.
Two avenues must be followed if the industry is to break even and become cost effective. The first is the reduction of uneconomic capacity. Labour Members sometimes react as if that had never been done before and as if private industry had never had to do that. All industries constantly have to examine their capacity to see whether it is efficient and economic. If it is uneconomic, it must close. It astonishes me that, after all that we have been through and after all the debates on these matters, there can be any remaining doubts about that. Yet the sentimentalists and traditionalists on the Opposition Benches wish to retain the system under which we have a major battle every time it is proposed to close even a small amount of uneconomic capacity.
I wish to be brief, so I hope that the hon. Gentleman will forgive me if I do not give way to him.
The other avenue that has to be followed is the development of new, low-cost capacity. We have heard about Selby and Asfordby and no doubt various hon. Members will mention other possible developments. Hon. Members will be keen on such developments if they are outside their constituencies and less keen if they are in their constituencies. I am in the first category in talking about the prospects of developing the south Warwickshire coalfield. We have the potential there to develop the most profitable coal in Europe. It is an enormous reserve, which can be easily mined and it would help enormously to reduce the average cost of British coal.
I wish that we did not have to go through this degrading business of discussing enormous levies from the taxpayer to sustain the coal industry. I should like to see a low-cost industry which is exporting—as it used to—is high volume—as it would be if we were exporting—and pays high wages. Labour Members talk about American styles of mining and management. I should like to see American-style wages, because miners in parts of the American industry earn £25,000 a year. Do Labour Members wish to pretend that that is not so? Should not they be fighting for such wages?
The evidence is readily available and I will provide it for the hon. Gentleman. One of my hon. Friends tells me that the evidence is in the Library. I do not have the evidence with me, but I can certainly pinpoint it for the hon. Gentleman.
Members sponsored by the NUM and NACODS should be jumping up and down with glee at that prospect, bullying the Government to take those steps and banging on the door of Hobart house fighting for those developments and for a high-wage industry. We should put these degrading spectacles behind us and move to a high-wage, high-volume, low-cost industry as quickly as possible because that must be the future for the coal mining industry in this country.
We had an extremely disappointing speech from the Secretary of State. I appreciate the limitations on a Minister introducing a Second Reading debate, but the Secretary of State failed to address himself to the immediate problems which have arisen as a result of the strike and which will continue for a considerable time.
Regrettably, too, the Secretary of State implied in the first part of his speech that the dispute had been caused by the National Union of Mineworkers. Any fair-minded person, certainly anyone with the Secretary of State's intelligence, would have said at the very least that there were two sides to the problem. For reasons that we have given many times in the House, we believe that the strike was caused by the National Coal Board, not least by its chairman, and by the Government themselves.
Having begun in that extremely disappointing way, the Secretary of State went on to talk about "rational decisions", by which he meant Government decisions. Government decisions are not rational decisions, although I hope that from now on some literally rational decisions will be taken.
The Bill will help to accelerate pit closures. As the Government and the NCB are hell bent on that objective, we must consider what can be done to mitigate the effects of such a misguided policy. It should be stated clearly and firmly that what was said during the strike about the case for coal and about the effect of pit closures on mining communities is as relevant today as it was every day throughout the dispute.
I intend to ask some specific questions and I hope that we shall get specific answers from the Minister. Those questions are crucial not just to the industry but to the inhabitants of mining areas. First, however, I should make it clear that I have never shared the Government's view that confidence in the industry has been lost. I can understand that view, but in fact throughout the year-long dispute that loss of confidence did not take place. l shall give two examples.
On 20 February, the Minister replied to a question from me about the coal-firing scheme, in which I have taken a special interest because boiler conversion to coal is important for the development of the industry. I asked how many projects had been accepted and the amount of grant paid in each year since the scheme began. It is significant that in 1983, before the strike, 127 projects were accepted compared with 94 in 1984. More than once in debates and at Question Time the Secretary of State gave the clear impression that the scheme was virtually at a dead end because business men were no longer applying for it, but the Minister will readily agree that the figures that he gave on 20 February show no such lack of confidence in the industry. During 1983, grant for the 127 projects amounted to £3·82 million. Last year, grant amounted to £6·72 million—double the previous year.
I do not accept that—it is a red herring. We are entitled to compare the number of projects that received grant last year during the thick of the strike with those that received grant the previous year.
I have to be careful about my second illustration because I do not want to reveal too much. During the past few days I have spoken to a senior manager—he is not really a manager, but I have to disguise him as he is at a very senior level in the coal industry. He is concerned about recruiting markets. He has been around the world a little and I asked him what was happening. He said that it was tough, but the markets were coming back.
It is vital for the future of the industry that markets return. I have visited many potential coal conversion schemes during the past few weeks, and at last confidence is returning. However, it is returning for one reason—because during the 12-month strike the NCB, thanks to the efforts of its marketing department, was able to keep the industry supplied. The working miners kept confidence in the industry.
The Government cannot have it both ways. The simple fact is that markets are returning because there is confidence either in the short, middle or long-term future of the industry. The Minister gave a non-answer.
My first question relates to the £10 million that NCB (Enterprise) Limited is making available for the rejuvenation of the coal mining areas. The first announcement about such aid three or four months ago involved only £5 million. Someone described it as chickenfeed. Then, in answer to my parliamentary question, the Secretary of State said with great pride that the sum had been doubled to £10 million. My constituency could use £10 million, let alone the whole of the British coal mining areas. Is there any likelihood of that sum being increased? I know that the right hon. Gentleman said today that it would be increased, but I hope that that will not mean an increase to only £12 million or £12·5 million. We need a minimum of £50 million.
Let us consider what happened in the steel industry. I remind the House of Consett in the county of Durham. Money should have have been made available to that area, but almost no improvement has occurred in that part of Durham. I implore the Government vastly to increase publicity about the scheme. I have spoken to a number of business men in my constituency and elsewhere but have come across only one who has heard about the scheme and applied for aid.
My hon. Friend the Member for Hemsworth (Mr. Woodall) said that administrators were uncertain of what to do. I do not blame them for that. They are hesitant to consider a grant. I urge the Minister to take a close look at this matter and ensure a speeding up in the granting of money.
My second question relates to the contribution that the Department of Energy will make towards reconciling mining communities with the police. I hope that the Minister will not play Pontius Pilate and say that that is a matter for the Home Office. It is a matter for his Department, and I am pleased to have the Minister's assent. I accept that it is a matter also for the Home Office. I cannot stress too much that relations between the police and mining communities have broken down. I am proud that I have been a member of a mining community all my life. I am proud also that I come from a mining family. Mining communities are great respecters of law and order, or have been. I tell the Minister with all the force that I can muster that that is not the attitude now in mining communities. I hope that the Department of Energy will make a contribution to restoring respect for law and order.
What do Ministers in the Department of Industry intend to do about the wholesale breaking of local agreements? If anything was designed to poison industrial relations, it is the breaking of the agreements, which were a demonstration of flexibility and good management in a particular pit or local area. In some areas a seven-and-a-half hour shift was agreed for good reasons, but there is a move back to the old eight-hour day. That has been happening throughout the area which I represent. It is a demonstration of the hard line which the coal board is taking, with the knowledge of the Secretary of State and the Under-Secretary of State.
What are the Government's policies on opencast coal mining and on the importation of coal? We all know that strip mining is so much cheaper than deep mining. We want an assurance that the balance will not be changed to the disadvantage of deep-mined coal. This is important for the future of the industry.
I wish to draw the Minister's attention to the coalfields', local authorities' and communities' campaign. It is a consortium of local authorities whose communities will be affected seriously by pit closures and colliery job losses. Will the Secretary of State undertake to have continuing consultation with the consortium? It will ensure that all the problems stemming from closures and job losses will be collated. The problems should be considered by the Government if they are concerned genuinely to restore good will and economic progress in the coalfields.
I believe that the Government are underrating the problems in the coal mining communities. Some would say that it is more likely that they do not care about the problems. The Secretary of State has said nothing this evening to convince me that the Government care and that they are prepared to work constructively in areas such as the one that I represent. The breaking of local agreements is a perfect example of how not to improve industrial relations after a dispute. The provision of £10 million for new jobs is already being laughed at by miners and their families. It is a sign of the Government's lack of real commitment to rejuvenate miners' communities. Thousands of young miners who have been made redundant will not have another job for years. I beg the Secretary of State to undertake a complete reappraisal, in spite of what has been said this evening, of the future of the industry in mining communities. The Bill does not even begin to meet the problems.
I regret that I cannot support the Bill. I have seen too many Coal Industry Bills to stomach yet another. I have heard it all before. I have heard all the promises about the industry breaking even, but each new Coal Industry Bill is accompanied by even greater handouts from the taxpayer. The more subsidy we provide, the less financial discipline remains.
We should have before us a Bill that includes the repeal of the nationalisation Act. The industry should be restructured to promote the development of competition. Such a Bill should promote private investment in the industry. It would serve the miners and the communities to better advantage.
The Government's successful privatisation programme was implemented not only to raise cash for the Treasury. The Government's central strategy is that it will improve the efficiency and competitiveness of the economy if we reduce public sector expenditure. That has been the motivation. Could any industry be more eligible within that central strategy than the coal industry?
If we are to make the industry self-supporting and profitable, if we are to improve conditions and industrial relations, the only way to achieve those aims is through privatisation, as the Government have admitted with all their other privatisation measures. Why should the coal industry be exempt? Indeed, it should be the top priority, because it has been a bigger burden on the economy than have other industries, and it is more vital to the future of the economy than are many industries which have been privatised.
I would argue further that, had the industry been privatised earlier, we would not have had the recent terrible, damaging dispute, because the hopelessly uneconomic capacity would have been closed long ago, new investment would have gone ahead earlier, industrial relations would be more harmonious instead of being chaotic, productivity would be higher and the earnings of those working in the industry would be better.
I shall not give way, because I wish to be brief.
If anything is to be learnt from the latest dispute, it is that nationalisation has been disastrous. It has not fulfilled its promise. Even if there were political, economic and social justification for nationalisation in 1946, those arguments are completely irrelevant now. It must be evident that nationalisation has brought weak, inefficient and bureaucratic management and poor industrial relations. It has not brought incentives or rewards to those who work in the industry. Morale has been poor from top to bottom, and marketing has been uncommercial.
No. The hon. Gentleman will have an opportunity to make his own speech if he allows me to make progress.
The cost to the nation of endless subsidies to the coal industry has been a huge burden on our economy. Consumers have suffered from unnecessarily high coal prices, which in turn have brought uncompetitive electricity prices. That has aggravated our industrial decline and created unemployment. The high price of electricity and the burden on the Government of having to finance these huge and ever-increasing deficits have prevented those resources from being deployed in other areas. I estimate that, since 1966, coal board deficits that have had to be financed by endless Coal Industry Bills, adjusted to today's money terms, amount to £7 billion. If we add the figure in this Bill, the amount is more than £9 billion. In addition, we have written off from the balance sheet another £6 billion in capital debt. None of those figures includes the investment programme on which we have not had an adequate return.
If that huge cost to the economy had produced an efficient industry and low-cost coal, there might have been some justification for it, but it has not done so. Indeed, it has had the opposite effect. It has perpetuated the inefficiency in the industry, and now we are being asked to provide more. Had those subsidies been allocated to other more cost-effective projects, we could, for example, have had a Severn barrage providing 10 per cent. of our electricity at the cheapest possible cost. On top of that we could have had three or four nuclear power stations, again providing the cheapest power that we could have, and we would still have had enough left over to build about 10 major combined heat and power district heating schemes, which would provide cheap heat for millions of our citizens. We have done none of that. Year after year we have sunk in increasing subsidies to the coal industry——
I have already said, if the hon. Gentleman will forgive me, that I should prefer to allow him to make his own speech if he will let me make a little progress.
Therefore, I argue that, whatever justification there might have been for nationalisation in the past, it is totally irrelevant today. We should now get on with the restructuring of the industry. Its monopoly powers should be broken. Opencast mining should be hived off entirely from the coal board, with the Department of Energy as the licensing authority. Then it would be not held back and restricted, but set free to compete.
We already have a deep-mine private sector coal industry, with about 130 mines. Why should each mine be restricted to 30 miners and limited production? Why not allow the monopoly statute to be broken so that we can encourage private sector mining?
Why cannot we have mineworker and management buy-outs, as with the National Freight consortium, so that the miners can benefit from what they produce in terms of profit-sharing? In that way many of the so-called marginally uneconomic mines could turn out to be marginally profitable.
With regard to the new coal areas, there is no reason why private sector investment should be prohibited from participating. Why should British companies, such as British Petroleum, with huge mining expertise, have to invest abroad in coal mining and be prohibited from participating in our industry? Many British enterprises would look for successful investment opportunities in the coal industry if they were allowed to participate. We could be producing at least 60 million tonnes of coal in the private sector at below £30 a tonne. The rest of the production could still be subsidised on a phased-out subsidy, but it would be far more cost effective to the taxpayer if subsidies were made available to the private sector rather than to the NCB.
My argument rests on my concern for the industry. Why should miners, who have had such a raw deal from nationalisation and, more recently, from their NUM leaders, be denied the benefits and advantages that have come to workers in other industries that have been privatised—profit sharing, share ownership and other real incentives? Why should they not be allowed to benefit from the advantages that are enjoyed in industries that have been liberated from the state?
If it were the Government's intention to provide the consumer, the taxpayer and those working in the industry with a better deal, we would be moving in that direction in the Bill. We have the largest reserves of economically recoverable coal in western Europe. We know that coal has an increasingly important role to play in our energy economy and that of western Europe in the two or three decades to come. We have a huge potential for increasing, not contracting, production, because of the export markets that we could win back and because of the new markets from pulverised coal, coal gasification, combined heat and power and fluidised bed. We could win back markets that coal will have to win back in the long term in any case. That potential has not been exploited by the nationalised industry. Indeed, it has failed to do so. Yet that potential will need to be developed if our economy is to benefit.
On past performance, there is little to inspire confidence that the industry's structure can be relied upon to harness its enormous potential, even if we could afford the huge price of retaining the industry in the public sector. We must now set it free and give it an opportunity to realise that it must make a critical contribution to the national economy.
Some hon. Members have attacked nationalised industries and have said that if they were privatised they would not have to be subsidised. One industry which is not nationalised is farming. It is efficient and receives subsidies year after year. Conservative Members contradict themselves. They vote in favour of subsidies for farming. I do not criticise that, because it might be necessary to subsidise the farming industry to make food cheaper, but if that is so hon. Members should not attack subsidies to the coal industry.
That is a fair point.
We must consider other countries, especially those in the EEC. The 1983 subsidy for the United Kingdom was £7·4 per tonne. For West Germany the subsidy was between £11 and £12 per tonne. For France it was £19 per tonne and for Belgium £13·3 per tonne. Our industry receives the lowest subsidy in the EEC. The figures are not mine, but from the EEC accounts.
One of the reasons for the coal subsidy is that our coal is sold too cheaply. After the war, the market price for coal could have stood an increase of £1 or £2 per tonne, but inflation had to be kept down. It could have been a rich industry if the market price had been charged. Selling coal so cheaply helped business and the country, but it did not help the industry or the miners.
The Bill is supposed to help the industry in the next three years. The Government figures are always a year behind the coal board accounts. The grants allocated for 1987 will be paid in 1988. The grants would then be given in a financial year that was the same for the Government and the NCB. Otherwise the grants will be for a different financial year. That would mean that the NCB might not have to break even on the Bill in 1987, but could carry on till 1988. I hope that the Minister will be able to explain how he hopes to help the industry through that crucial period.
Can the Minister also tell us how far the administration costs are charged to the NCB? Perhaps he could give us a percentage figure. I am also interested in deferred payments. They are not referred to in the Bill. We never seem to see the figures. I shall take the example of Thorne colliery in my area. It is a new colliery. About £3 million is being invested at the pit bottom this year, and about £20 million or £30 million is needed to start the number three shaft working. With Thorne colliery as with all new pits, the critical path is about 10 years. A tremendous amount of investment will be needed before coal is produced. Will the money be borrowed on deferred payment terms? If so, is that money over and above the sum that the NCB is permitted to borrow?
The NCB can be criticised for borrowing from the Government but is not allowed to look anywhere else. It is not allowed to turn to the free market or to the EEC. Especially with regard to new developments that are in the pipeline, it is important that the NCB should not be expected to break even when it is borrowing millions of pounds that will not bear fruit for some time because of the critical path.
Managers do not produce coal. They are necessary, and they are responsible for the colliery, but they do not produce coal. One might say that machines produce coal, but the machines have to be worked by miners. If the relationship between the management at colliery level and the miners is unsettled—and it is unsettled to say the least—there will be no coal production. The relationship is very bad. Some of the lads are saying, "Wait till the black stuff comes out. There will be good relations then or they won't get it." It is vitally important that relations at colliery level should be better.
Then there is the question of custom and practice accepted at the pits for years. Not all customs are good. Some may be good; others could perhaps be reconsidered. However, management is breaking them without any negotiation at all. It is unbelievable that a management that wishes to work with the men and produce coal should behave like that.
For example, some lads work in water from the roof. That water is very salty and sometimes there is oil in it. When a miner has worked on the coalface or the frontlip for six hours, he is ready for a bath. It was the accepted practice and custom that the men arrived an hour earlier, although they did not leave the pits earlier because it took them that long to bath and to scrub off. However, the management stopped it. When the lads reach the pit bottom now, they stand waiting in the queue with their clothes wet through because the management has decided that the local agreements just do not stand up. It is not logic. If I were a manager—of course, I am not—I could not do that because I would want the men to produce more coal for me.
It is the duty of the Secretary of State to bring this matter to the attention of the leaders of the nationalised industries. We all want an efficient industry. The attitude of management must change. Managers must work with the union men. They are not even negotiating compensation cases. These cases are important, and they must be settled. The Secretary of State would do well to discuss this matter with higher management to see whether something can be done to improve the silly method of industrial relations which has continued since the dispute ended.
I agree that the industry needs increased productivity, but it also needs increased production. It is no good increasing productivity if production is decreased because the unit costs then fall on a smaller number of units, and pits which were economic will be made uneconomic. I can remember the Minister stating during the strike that the production target should be 125 million tonnes, an increase of 25 per cent. That is good sense. The market is at fault because it is left to the whizz kids of the NCB, the sellers of the coal. For selling coal abroad, one may have to use different methods. Indeed, coal may have to be sold cheaper for various reasons. There is nothing wrong with that because it will keep down the unit costs. I hope, therefore, that the Minister will agree that production as well as productivity must be increased. If not, the industry will never break even, because the unit costs will increase.
We must work for an efficient industry, although I do not agree with the closure of pits. Towards the end of the century, we will need all the coal that we can get in order to extract its oil content for the use of other industries. If we consider the matter in any other way, we will be taking too narrow a view. We must aim for a good and efficient industry and, in so doing, we must look after the work force. If we look after the miners in the British coal industry, they will produce the coal for the country.
I wish first to pay tribute to the hon. Member for Orkney and Shetland (Mr. Wallace), who has been present throughout the debate—the only member of the Liberal party who has. He must carry a heavy burden, of course since he also represents the Social Democratic party, not one member of which has been present throughout the debate. Those hon. Members with coalfields in their constituencies read frequently in the local papers of the passionate concern for the coal industry demonstrated by that other half of the alliance.
Although they are not present, they may share the Secretary of State's view that there are substantial prospects, that we have good reserves that the investment record, to the tune of 95 per cent., is British-based and that over the years the NCB has ensured and will continue to ensure that we have a leading mining engineering and mining equipment industry. I agree that industry has an important part to play, but its future depends on the size of the base of the British mining industry.
If we are to achieve improved productivity, two aspects must be borne in mind. First, the Government's economic and industrial policy must be reversed. The main reason why productivity gains were not achieved in the early 1980s was that miners could see enormous stocks of coal, and nothing is more discouraging for miners than the sight of huge stocks outside their collieries.
If there had not been enormous cuts in the consumption of electricity, for example, by the special steels section of the steel industry, coal consumption for electricity generation would have been much higher, stocks would not have been so high, the dispiriting effect of the sight of those stocks would have disappeared and, as a result, morale and productivity would have improved.
We saw the decreasing morale problem developing with the appointment of Mr. MacGregor. As I have said in the past, some of us warned the Government months before the strike took place that a strike was coming, that it could be vicious and that it would be gravely expensive, and it proved to be even more expensive that some of us feared. It cost £32,500 for every man employed in the industry. That money could have been used to revive British industry and create the employment we need.
That is now behind us. As my right hon. Friend the Member for Blaenau Gwent (Mr. Foot) said, we are going through a delicate period. The efforts and priorities of the Government should be devoted to ensuring that the industry succeeds and that the problems and bitterness that have developed do not persist, so enabling the industry to achieve the success that we all want to see.
I am sure that the Secretary of State and his colleagues in the Department have devoted a great deal of attention and energy, and perhaps even enthusiasm, to ensuring that the industry succeeds in this post-strike period. The problem is that they are not being assisted in that endeavour by any evidence of wisdom on the part of those at the top at Hobart house. I had hoped, as the Secretary of State also hoped at Question Time on Monday, that yesterday's meeting would prove meaningful and helpful and would lead to progress. While I am sure that Ministers want to see progress, I am not sure that those at the top at Hobart house do. If they did, they would adopt a more sensitive attitude to all concerned, and in particular the trade unions.
When union leaders tell me that the NCB boasts that the men are accepting voluntary redundancy—when the men are told, "It is either voluntary redundancy or down the road"—those union leaders are right to say that that is not voluntary redundancy at all. If the men are told they must accept the NCB's terms or become unemployed, that makes a mockery of the use of the word voluntary.
There is bitterness. It is clear that bitterness exists over the situation at Polkemmet, an issue which I discussed with my hon. Friend the Member for Linlithgow (Mr. Dalyell), as did my right hon. Friend the Member for Salford, East (Mr. Orme). The NCB lied to NACODS. NACODS was deceived and tricked. The Minister can take the NCB's word for it if he wishes to do so, but I have been associated with that for a long time and I assure the House that the leaders with whom I discussed the matter are not in the habit of lying, and I do not believe that they would lie to me. Be it Mr. O'Connor, the Scottish secretary, Ken Sampey, our long-serving president, or Peter McNestry, the general secretary, they are convinced that the NCB has deceived and cheated them on the issue of Polkemmet pit.
I am told that NACODS men offered to go down to turn on the valves to allow the pumps to operate. I am told that the National Union of Mineworkers would not have objected to that involvement of my association's members. I am told that the National Coal Board would not allow the valves to be turned or the NACODS men to go down, but that it assured my association that when the strike was over that pit would be pumped and the jobs saved.
However, the National Coal Board has now determined that, because of flooding, that pit must close. It has not even had the grace to wait until the NACODS agreement is in force before coming forward with that suggestion. It is also true that, under the old procedures before the strike procedures which my association's agreement is supposed to approve, the status quo certainly applied. The status quo is not applying now and, as far as I can see, the National Coal Board—I believe against the advice that Ministers have offered—is determined to get the pits closed before it makes progress on the NACODS agreement.
That is not the way in which honourable men should behave and the Government are in an embarrassing position. That is why my association, without wishing to get headlines, is now seeking the highest level meeting possible so that the Government can demonstrate that the words which they used in the House and outside it justified. If the Minister and his colleagues, including the Prime Minister, use the word "sacrosanct", that word must be applied. I have no time for the present Government, but I believe that the occupants of the Treasury Bench must stick to the words that they use. The British people, albeit that they may be members of trade unions and therefore not quite so highly regarded by Ministers and the rest of the population, believe that if Ministers use words at the Dispatch Box to make a commitment that must be honoured. I hope that the Government will take seriously the position which has now arisen and which has led my association to seek consideration at the highest level. I am awaiting the response to that request.
I am deeply concerned that we should allow the industry to succeed. That is why it would have been better for magnanimity to be shown immediately rather than for area directors to have to intervene at the level of decision making, which should have been left to managers. Many managers have made sensible decisions. There are pits in my area where managers have not sacked anybody even though that may be a posture that is not currently fashionable in the industry. The pits where that has happened are back at work and relationships are far better than in pits where vindictiveness has been shown and a particular manager may have sought glory or congratulation from the more hidebound or hard-line people who have been singled out for favour by the present administration of the industry.
I am making these points because I believe that we must have a successful coal industry. It is therefore highly desirable that consideration be given to the application of wisdom.
I accept that pits will close. No one in his right mind can expect a colliery to remain open indefinitely. I know, for example, that at Cortonwood a substantial proportion of the labour force would like to take early retirement or go to a pit with a long-term future. It is a pity that careful consideration was not given a year ago to allowing that procedure to develop naturally. But when pits close we are faced with dreadful problems, and £5 million or £10 million for the sort of scheme that is now being introduced and which may be the little seed from which great things will grow—although it will require a great deal of expensive fertilisation as well—will be necessary.
I heard from my borough council today in reference to a coalfield community campaign—of which the Minister will have heard and which must achieve a great deal—how great is the need.
This morning I looked at the analysis carried out by the director of planning in Rotherham. We lost 1,100 jobs in coal between 1979 and 1981. One would not have imagined so, judging by all the accusations of failure to contract, and so on, that we have heard recently. The labour force in mining in Rotherham fell by 18·4 per cent. in two years before the strike—6·6 per cent. in the country as a whole. But we also have to recognise that in those two years there was a 34 per cent. increase in the number of cases referred to our social services department; that the number of people on rent and rate rebate increased from 11,000 to nearly 20,000; that the number of people in housing rent arrears and the number of people approaching the poverty level virtually doubled in a two-year period before the strike. Yet the Conservative party wants to put areas such a mine into a position where that sort of experience is greatly intensified.
The time scale of change should not be so abrupt that it reflects cruelly upon any particular community. In my constituency, Brampton Bierlow is the village serving Cortonwood colliery. That village, which has 57 per cent. male unemployment, is dependent on Cortonwood, which is not a long life pit. The proposal to close it in five days did not assist that community. But £5 million or £10 million for the nation as a whole in generating economic activity in the coalfields will not help Brampton Bierlow sufficiently if it gets only an absolute statistical share of that money.
The mining communities and the local authorities serving mining communities, where the pits are old and of limited life, need a greater priority, particularly because there are no jobs, as some of my hon. Friends have said, for our young people. In the metropolitan borough of Rotherham, the proportion of our people under 25 is above the national average, which merely means that we face a more intense problem than we had before. But there is another aspect of the matter. If our crime rate in south Yorkshire increases over the next seven years as it has over the past three years, by the end of the decade it will be five times as high as it was when the Government took office. No civilised society can maintain itself if the crime rate rises in that way. If that trend continues, by the middle of the 1990s we shall have a crime rate seven times higher than it was in 1979.
If we condemn our young people to hopelessness, and if we deny hope and economic support to our communities, the quality of life in the coalfields of Britain, which once were stable and where people could live decently, will be in peril. It is not simply a matter of balancing the national books or of selecting areas for investment; it is a question of making sure that life in Britain remains civilised and stable. It will not remain civilised and stable if we have people at the top of the coal industry who believe they have succeeded if they have tricked and deceived a trade union as responsible as mine.
The Minister has a very heavy responsibility. I trust that in his reply he will say something that will satisfy my union, but it will be satisfied only when the Government's word is demonstrably kept, and it has not been yet.
I thank the hon. Member for Wentworth (Mr. Hardy) for his kind introductory remarks, even if they were somewhat two-edged.
When I rise to speak in a coal industry debate, I am conscious that—unlike the Opposition Members and some Conservative Members who have spoken—I do not come from an area with any coal mining interests. Nevertheless, it is only fair to say that money going to the coal industry is contributed as much by people in my constituency and elsewhere as by people in mining areas.
Without any disrespect to hon. members representing coal mining, I suggest that the British coal industry is not their sole preserve. It is a national asset in which we all have some interest. That was one of the mistakes made by the hon. Member for Ludlow (Mr. Cockeram) when he looked at the deficit grant and said by how much it would subsidise each miner. He overlooked the extent to which the coal industry makes a contribution to our national life. Prior to the 1984 dispute, coal had emerged yet again as the principal primary source for the generation of electricity in this country. One cannot ignore what would happen if the subsidies to the coal industry were to be withdrawn, as has been suggested in the debate by ome Conservative Members. However, it is only right for the House to look carefully at the reasons for providing such large sums of money to the industry. We should look forward not to an open ended commitment but to the day when, as the hon. Member for Doncaster, North (Mr. Welsh) said, the industry will be efficient. That will be brought about not only by improved industrial relations, as the hon. Member suggested, but also by the replacement of old, worn out and uneconomic capacity by new capacity and by developing existing capacity in such a way that it can win coal more cheaply.
Although this is a large sum of money, I believe that it ought to be regarded almost as a bridging loan. It was suggested earlier that the coal industry has been making losses ever since it was nationalised. That is not the case. The projected production levels in the "Plan for Coal" were substantially met until 1979. Those who worked out the "Plan for Coal" in 1974 could scarcely have foreseen the size of the recession in the coal industry and its great contribution to the lack of demand for coal. As many hon. Members have suggested, the prospects for the coal industry are very bright. Therefore this amounts to a bridging loan.
The Secretary of State for Energy referred to the interest which has been shown in the coal conversion scheme. Substantial numbers of former customers of the coal industry have returned and the industry has recovered the ground that it lost during the dispute. In the much longer term there are prospects for the gasification and liquefaction of coal. Although it may be 15 or 20 years ahead, it is essential that research into those techniques should be maintained.
It is agreed that there is a potential market for the coal industry, and in the immediate aftermath of the dispute it is important that we should do everything to enhance customer confidence in the industry. Although it was said that the hatchet would be buried and that there would be reconciliation, events have occurred since the strike ended which do not necessarily bear that out. Reference has already been made to Polkennet. In September 1984 Mr. O'Connor, the Scottish secretary of NACODS, appeared on television and said that he was alarmed by the brinkmanship tactics of the National Coal Board in Scotland. I wrote to the Secretary of State and expressed my concern about what Mr. O'Connor had said. I do not know him but——
The hon. Gentleman says that he is a very responsible man and I am sure that he is. What he said caused me considerable concern. I join those who say that there ought to be an inquiry into what took place in the Scottish coalfields during the strike.
The other matter raised by the right hon. Member for Salford, East (Mr. Orme) relates again to Scotland and to the lack of reinstatement of those miners who were sacked. I have spoken to the Parliamentary Under-Secretary of State for Energy, the hon. Member for Wirral, West (Mr. Hunt), about this. He pointed out that in Scotland perhaps greater care was taken prior to dismissal than happened in other places. Nevertheless, I have been informed of a good number of cases where the grounds upon which dismissal took place appeared to be relatively trivial. The right hon. Member for Salford, East mentioned the case of a senior union official at Bilston Glen who was acquitted in the Edinburgh sheriff court of the charges brought against him. I cannot accept that somebody who has been acquitted should suffer the double jeopardy——
The hon. Gentleman says that he was not acquitted because the case was not proven. If he knew anything about the law of Scotland he would realise that a verdict of not proven amounts to an acquittal.
It is all very well for Conservative Members to say that sacked miners can apply to industrial tribunals and claim unfair dismissal. However, that misses two fundamental points. First, the unfair dismissal procedure cannot compel reinstatement and a person who is not reinstated loses not only his job, but entitlement to the various industrial benefits, redundancy pay and so on. Secondly, there is a conciliation and consultation procedure in the industry and that should be the first step. Going to an industrial tribunal should be the second step.
I wish that the conciliation and consultation procedure were used more often. My latest information is that the NCB has objected to the re-appointment of Mr. Jack Kane, who was the chairman of the conciliation and consultation committee. He is a respected former Lord Provost of Edinburgh, and before the dispute he had done his work successfully. The NCB's objections were seen as a fly in the ointment. They impeded moves towards better relationships between management and the unions.
Hon. Members have mentioned NCB (Enterprise) Ltd; and I remind the House that my right hon. Friend the Member for Plymouth, Devonport (Dr. Owen) accepted the need for such a company long before the Government. He pushed the case for establishing the company and my right hon. and hon. Friends believe that the £10 million given by the Government for the new company is inadequate. The Secretary of State told us something about the company's progress, but I note that in the United States some companies spend between 2 and 5 per cent. of pretax profits on community projects. The equivalent figure here is 0·1 per cent.
It is inevitable that some mines will close. Often miners themselves see the need for that. I hope that talks that take place before closures will involve not only representatives of the work force and the management but representatives of the local community, because a wider community interest is involved in such decisions. I do not come from a mining area, but communities matter greatly in my constituency and I empathise with mining communities that feel threatened.
No community should face the prospect of a closure without the prospect of new jobs. The planning for new jobs should not wait until the closure takes place. There should be discussions at an early stage to allow new employment opportunities to be planned and established before a closure. If that means postponing a closure, with some loss to the NCB, the Government should accept that that is a social cost, rather that an ecomomic cost that must be borne by the coal board.
The Bill gives an opportunity to bridge a gap and allows the NCB to get itself on its feet and reorganise more efficiently. As well as ensuring that possibility for the coal board, the Government must offer hope for areas which, because of closures, might not participate in the future of the coal industry. Those areas deserve hope and new forms of employment.
The Liberal party's case might have more force if its leader had taken the time to visit a pit and a strike centre when he came to my constituency during the dispute rather than just whizzing through the area. As for the SDP, the right hon. Member for Plymouth, Devonport (Dr. Owen) shows exemplary interest in a number of things, but he has shown the extent of his interest in the coal industry by his continuous absence from coal industry debates. [Interruption.] If the hon. Member for Roxburgh and Berwickshire (Mr. Kirkwood) wishes to intervene, I should give way, but he should not mutter from a sedentary position.
I have some sympathy with Conservative Back Benchers, having listened to the Secretary of State introducing this important Bill. I have characterised the right hon. Gentleman on previous occasions as the custodian of the public interest, representing the shareholders of the nation. He comes to the House asking for a huge sum of money and, as it were, lays down the prospectus for the future of the industry. Unless I missed something, however, he said nothing whatever about the future output of the industry, future employment in the industry or even the number of pits. That is no way for a Government of business men to bring forward a prospectus and to ask for huge amounts of money.
In the circumstances, it is not surprising that some Conservative Back Benchers have objected. The hon. Member for Erewash (Mr. Rost) said that he could not support the Bill, because he wants the industry to be privatised. If he has read any economic history at all, he must know that up to the 1940s the industry was privately owned. All the difficulties in those days were the result of rapacious private enterprise. The idea that the Government should use public money to put the industry on its feet and then sell it back into private ownership is preposterous.
The Secretary of State has come forward with a good Bill for the industry, but he is counting the cost of the dispute after the event when a prudent Government would have counted the cost before the strike even began. My hon. Friends have referred to Polkemmet. I shall not rehearse the arguments about Bogside. I have described the situation in my constituency on several occasions. Ministers seemed to be well versed in what happened at Polkemmet, but they were completely ignorant about the huge exercise in industrial vandalism perpetrated at Bogside by Mr. Wheeler and his cohorts. The people of Nottinghamshire are welcome to Mr. Wheeler. I shall pray for them if he adopts the same attitude there.
On Monday the Secretary of State, in answer to questions that the Scottish director had been unduly vigilant in examining the cases of people whom he wished to dismiss, said that he was operating a unilateral policy and that Mr. MacGregor had nothing to do with it. More than 200 men were dismissed, but the Secretary of State tried to argue that people in other areas had objected because they had been dismissed for incidents less serious than those that occurred in Scotland.
I shall not deal with the whole Scottish coalfield or with every pit in my constituency. I shall not even refer to all the men dismissed from one of those pits, although I have sent details of all of them in a letter to the Minister. I shall give just a few examples of the dismissals at Comrie colliery. Check No. 1089 David Carruthers, aged 51, was convicted of a breach of the peace and fined £25. After 30 years unblemished service in the coal industry, that man has been dismissed. If that is a serious crime, he should have been charged with a serious crime. In Scotland breach of the peace is not regarded as a serious crime.
Another man, George Wallace, check No. 1517, aged 30, was bound over to be of good behaviour for six months. He had been in the industry for eight months, and was dismissed. I could give other examples. One of the finest men I know is the chairman of my constituency party—[Laughter.] Why are Conservative Members laughing? This is a serious matter. His name is Robert Young, check No. 1569, aged 41. The offence was breach of the peace, and he was fined £75. He had 10 years service in the industry, and he was dismissed. I know that there have been instances of more serious offences, but all the offences involved in the cases I have cited have been for breaches of the peace.
Conservative Members ask why these men do not go to the industrial tribunal. It is because the NCB has a statutory responsibility to carry out a conciliation and consultation procedure. Those who have taken the trouble to read the report of the Monopolies and Mergers Commission will know how highly that has been praised. Do Conservative Members want unions to throw that away? They know that if an umpire decided that someone should be reinstated, that decision would be binding. That is not the case with an industrial tribunal.
These are serious issues. It is one thing for the Secretary of State and Mr. MacGregor to say that it is appropriate to adopt a flexible attitude to investment and profit; it is another to argue for decentralisation and a non-uniform policy for industrial relations.
I repeat that doing business with Mr. MacGregor is not something that I would ever want to do again. Ten Labour Members, including my hon. Friend the Member for Glasgow, Garscadden (Mr. Dewar) met him on 20 March. We came away from the meeting thinking that at least we had made some impression. Yet within half an hour, he was contradicting every impression and word that he had given during the meeting. That man cannot be trusted.
I made a great mistake on Monday be referring to Mr. MacGregor as a Scot. He is a Scot by birth and an American by choice. The sooner that he returns to the United States, the better. It is a crying indictment of British management to have that man in charge of a public sector corporation. The Secretary of State should be ashamed of himself for asking us to put these sums of money into the hands of that vindictive employer. I am sure that the right hon. Gentleman, in his better moments, recognises that that man is not the person to carry the industry into the future. If we want better industrial relations and if we want the men to recognise that they have a responsibility for the pits, the lead must come from the top at Hobart house. It is my humble opinion that that lead will not come from the top while Mr. MacGregor is still at the NCB.
I hope that what I have said about Comrie colliery and the unfairness of the treatment there will be taken on board by the right hon. Gentleman and his hon. Friend. I hope that men throughout Scotland, but particularly those I have described on a case-by-case basis, will see the conciliation and consultation procedure reinvoked for the benefit of all.