Coal Prices

Oral Answers to Questions — Trade and Industry – in the House of Commons at 12:00 am on 10th June 1992.

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Mr. Alan W. Williams:

To ask the President of the Board of Trade what is his policy towards the attempts being made by the European Commission to establish a reference price for coal.

Photo of Mr Timothy Eggar Mr Timothy Eggar , Enfield North

The Commission has put forward preliminary ideas on reference prices for coal as a device to restrain excessive levels of subsidies for coal mining in some member states. There is no suggestion that the Commission intends to subsidise Community coal production so that it is all sold at a reference price level. We support the Commission's aim of reducing unjustifiable subsidies.

Mr. Williams:

Is there not an appalling unfairness and absurdity in the fact that Britain, which produces the cheapest coal in Europe, is running down its coal industry while Germany, whose coal production is twice as expensive, is providing massive subsidies? What are the British Government doing to open up Europe's coal market?

Photo of Mr Timothy Eggar Mr Timothy Eggar , Enfield North

I have made it clear that the European Commission is as concerned as we are about the subsidies offered to some coal-producing member states and has made proposals to reduce the level of subsidies which it currently pays. Although we have some doubts about the precise proposals, we support the broad thrust of the Commission's suggestions.

Photo of Mr Phil Gallie Mr Phil Gallie , Ayr

Will my hon. Friend and the House take note in response to an earlier question that Scotland is a supplier of low sulphur coal? May I welcome my hon. Friend's comments on the reference price and urge him to take urgent action to ensure that our coal can be sold on a level playing field with other coal produced in Europe?

Photo of Mr Timothy Eggar Mr Timothy Eggar , Enfield North

Yes, I share my hon. Friend's objective. Clearly, it is important that no artificial subsidies are available which distort market pricing.

Photo of Mr Rhodri Morgan Mr Rhodri Morgan , Cardiff West

In the light of the President of the Board of Trade's curiously forked-tongued speech yesterday to the annual conference of the Union of Democratic Mineworkers, in which he said that he would not intervene in the relationships between British Coal and the two electricity generators, can the Minister tell the House what price and what length of coal supply contracts National Power and PowerGen should sign with British Coal to ensure long-term security of supply, long-term viability for the coalfield communities and his long-term friendship with Roy Lynk?

Photo of Mr Timothy Eggar Mr Timothy Eggar , Enfield North

The hon. Gentleman should do my right hon. Friend the courtesy of reading his speech, which clearly he has not, or—if he has—he has misinterpreted it. His latter question is a commercial matter for the generating companies and British Coal.