Coal Industry (Hansard, 29 March 1993)

§ Madam Speaker
A number of hon. Members may well be disappointed at not being called today. Therefore, I am now appealing most firmly for voluntary restriction on length of speeches. I have no alternative but to limit to 10 minutes speeches made between the hours of 6 and 8 o'clock.
As I said earlier, I have selected the amendment standing in the name of the Leader of the Opposition.

§ The President of the Board of Trade and Secretary of State for Trade and Industry (Mr. Michael Heseltine)
I beg to move, That this House approves the White Paper 'The Prospects for Coal: Conclusions of the Government's Coal Review' (Cm 2235). Let me remind the House of the opportunities for British Coal that I announced last Thursday. I followed very carefully the arguments put forward by the Select Committee on Trade and Industry. There were three themes to my proposals. The first was to create a wider market for coal. The second was to provide British Coal with a tapering subsidy to give it the chance to seize the opportunities of the enhanced market. The third was our determination to press ahead with our plans to privatise the industry.
Let me start with the wider market for coal. There are considerable differences of view as to the likely demand for coal. They reflect uncertainty about the longer-term demand for electricity. If the demand should prove to be as high as many commentators, including the Select Committee, expect, coal has every opportunity to take advantage of it. Within the existing firm forecasts, everyone agrees that we should help British Coal to secure the market that is currently filled by imports. That is why, on behalf of the Government, I am offering hundreds of millions of pounds to bridge the gap between British Coal's cost of production and world-related prices.
No one I know disputes that there is significant tonnage to go for, although, as I have told the House, there is considerable disagreement among the Select Committee, independent consultants, British Coal and the electricity generators as to the likely size of that market. I think that everyone understands that no amount of forecasting creates a marketplace; it is customers who create a marketplace. However, the Government are putting British Coal in the most favourable position to add these supplemental tonnages to the core contracts which, I am pleased to tell the House, have been announced today.
I have also told the House of the various ways in which I acted on behalf of the Government to increase the market for coal. The importation of orimulsion is to be reduced to the minimum contractual level for the foreseeable future. British Coal told the Select Committee that it believed that opencast production would decline from 16 million tonnes to 12 million tonnes. Last Thursday, my right hon. and learned Friend the Secretary of State for the Environment issued a statement of interim guidance to planning 26 authorities on opencast coal developments. We intend to renew our dialogue as soon as practicable with the French Government about the use of the interconnector.
I have, of course, published a summary of the legal advice which confirms beyond doubt that unilateral action by the Government would leave us open to very considerable risks. The outgoing French Government told us that they expected the present imports to decline and they confirmed that we are able to use their national transmission system to export electricity to France and to third countries beyond. As confirmation of that, a £100 million contract has been signed for electricity to be exported from the United Kingdom to France over the next eight years.
I have announced that, with the Director General of Electricity Supply, I shall enter into discussions with large users to examine the circumstances in which they might bypass the pool and whether demand-side bidding would improve the workings of the electricity market. In addition, the Government are reviewing the current regulation of on-site generation, which could offer large users an alternative source of electricity. They are all ways in which the demand for electricity could be increased, and that in turn means greater opportunities for British Coal.

§ Mr. Winston Churchill (Davyhulme)
I am grateful for the various measures that my right hon. Friend has announced but, at the very moment he was standing at the Dispatch Box making a statement last Thursday, a representative from British Coal was briefing the unions in Nottingham—the National Association of Colliery Overmen, Deputies and Shotfirers and the Union of Democratic Mineworkers specifically—on the prospects, as British Coal saw them. It told them bluntly that there was no additional market for coal to justify retaining the 12 pits beyond the period of the subsidy and that, furthermore, if there was to be any hope of survival, it would be by reducing their costs to the point that they could displace one of the 19 pits which at present has an assured future. That would seem to be directly sabotaging my right hon. Friend's statement and assurances.

§ Mr. Heseltine
My hon. Friend raises a most serious situation, which I have discussed with the chairman of British Coal this morning. I shall deal in a minute or two with the precise points that he has raised.

§ Mr. William O'Brien (Normanton)
The Secretary of State has been outlining what the Government are prepared to do to fulfil the statement made last Thursday. Is he prepared to assure the House that there will be a level playing field for the coal industry compared to the gas and nuclear industries? That is very important to the 700 men who work at the Sharlston pit in my constituency. The pit is doomed to early closure, as outlined by the Secretary of State last Thursday. May we be assured that there will be a level playing field and that the reserves at Sharlston will be worked? Unless the Secretary of State can assure us of that, the debate is meaningless.

§ Mr. Heseltine
The hon. Gentleman asks many questions. I must point out to him that the decision to close a particular pit has to be taken by British Coal. British Coal can take that decision only when it has gone through a process of consultation which takes into account all the issues that are raised in such a process. I cannot 27 today—and no Minister ever could in such circumstances—anticipate what the outcome of the consultation will be. The hon. Gentleman should listen carefully to what I have to say because it will apply to a large number of other pits—indeed, to all other pits—as well as to that to which he referred. A significant number of things that I have said, and which I shall be able to repeat in my speech, are relevant to the pits that may face closure.

§ Mr. Dennis Skinner (Bolsover)
The problem with what the Secretary of State has said today, what he said the other day and what was said on 13 October is that the figures for the contracts for coal to the power stations were 40 million tonnes last October plus 30 million for the four successive years. Last week he said that the figure was 160 million tonnes. It is the same amount—40 million tonnes followed by four successive years at 30 million tonnes. If he does not alter those contracts upwards, those 19 pits—[HON. MEMBERS: "Of course he cannot."] That was what he was supposed to do. That is what the review was all about. If he and British Coal do not alter those contracts, the 19 pits that still exist, the 12 pits that will stay open for two years, the six that have been mothballed and the pit at Maltby will all be scrambling for the same amount of coal. He can talk until he is blue in the face, but he must alter those basic contracts with the power stations, otherwise we shall not save any of the pits that he talks about.

§ Mr. Heseltine
I do not know about talking until I am blue in the face. The hon. Gentleman usually talks until he is red in the face if he is running into difficulty. However, if he had waited until I had made further progress with my speech, he would have seen that, in addition to explaining the additional opportunities that I have been announcing to the House since last Thursday, I am now about to come to the essence of the recommendation of the Select Committee's proposals: that we should help British Coal to gain some of the enhanced markets by subsidising its production costs.

§ Mr. Simon Hughes (Southwark and Bermondsey)
Will the Secretary of State explain how it is possible to make a decision about the future of the coal industry in isolation? He has agreed, in the White Paper, to bring forward the nuclear review, but that will not be until later this year. A decision on renewables will be taken later this year. The planning guidance on opencast mining will be issued, presumably, later this year—there is interim guidance already. The decisions about orimulsion by Her Majesty's inspectorate of pollution will not be made until later this year. The Secretary of State gives the impression that he is trying to buy a few votes to get him over the hurdle of Back-Bench opposition tonight. The strategic decisions about Britain's energy policy will be put off into the future when, one by one, each industry will have a decision taken separately. He will have washed his hands of the coal industry by selling it off.

§ Mr. Heseltine
The hon. Gentleman must know that the first imperative was to secure the signing of the contracts that have been announced today. They are due to run out on 31 March. Without them there was no contract at all for British Coal. I then agreed with the Select Committee all the items that it was to consider and all the items that I was to consider, as I was not prepared to come back to 28 the House and have it suggested that we had both not looked at all the items of common interest. There has been immensely constructive work together to secure those ends. I then took the principal recommendations of the Select Committee which relate not to core contracts, but to supplemental contracts.
It is those supplemental contracts which are now capable of being negotiated because of the decisions that I am announcing today and the decisions announced last Thursday. In addition, the market itself can be widened because of the various decisions that I have already announced. A significant number of decisions have already been taken. But—and this is the critical point from which the Select Committee cannot run and from which I cannot run—in the end it is not for Governments just to forecast or to say what they would like to happen. Customers have got to come forward and sign the contracts.

§ Sir Michael Grylls (Surrey, North-West)
Does my right hon. Friend accept that there are thousands, if not hundreds of thousands, of firms throughout British industry which, during the downturn in the economy, have been struggling to maintain their markets and to become more competitive? They have done that—all honour to them—without any subsidy from the taxpayer. Does my right hon. Friend further accept that the miners are exceptionally fortunate to have been given this opportunity to win back more markets if they can? They are now on their own; it is up to them to win back the markets, and they will not do so if they go on strike.

§ Mr. Heseltine
My hon. Friend has raised some important points.
Ever since I became responsible for this policy subject, I have been deeply concerned about the problems facing the mining industry and particularly about the mining communities that are dependent upon that industry. That is one of the reasons why I was able to persuade my right hon. and hon. Friends to secure a significant redundancy package—which is not in any way equalled by those received by the vast majority of people who lose their jobs in the recession—and to make my announcement about the regeneration package about which I shall say something in a few moments.
The House is well aware of the problems that face tight-knit communities when the principal industry on which they depend declines or has to be closed. That is not a new phenomenon: the problem has faced this country as long as I have been in politics and has not been restricted to the coal mining industry.
Let me now deal with the subsidy that the Government will make available to meet the difference between British Coal's cost of production and the world market-related prices. I have accepted the principal recommendation of the Select Committee that I should provide a subsidy to enable British Coal to compete with imports, which are currently running at about 8 million tonnes. Some people have claimed that the subsidy is only for two years. That is not what we say in the White Paper.
The subsidy is there to help British Coal become world competitive over a period of time. The Government's policy, therefore, is that the subsidy should be reduced, over the period to privatisation. Yes, as I said on Thursday, we are committed to privatisation at the earliest practical opportunity. It is the only way of enabling the 29 industry to take full advantage of the opportunities that the market offers. Privatisation may well come in two years' time. I myself would very much like that to happen. If it does not come then, the subsidies can continue. If it does, negotiations about the financial terms become part of the sale process. I must emphasise that we have made it clear that we are prepared to embrace the range of figures put forward by the Select Committee on Trade and Industry.

§ Several hon. Members
rose——

§ Mr. Heseltine
It is important that the House should hear a complete section of my speech at a time so that it can take these matters on board.
We have made it clear that we are prepared to embrace the range of figures put forward by the Select Committee on Trade and Industry. The Government are prepared to follow the central proposal that emerged from a thorough and careful review. I have not been able to accept every aspect of that reveiw, but, in the main, I have consistently praised the work of the Select Committee. It should be remembered that we have based our response to the House on the work and conclusions of an all-party Select Committee of the House.
Finally, I have guaranteed—and the chairman of British Coal has announced—that no pit threatened with closure will be closed without the private sector being given the chance to operate it. In that context, I am prepared to offer the private sector equivalent subsidy arrangements, subject to the relevant EC provisions, if it can demonstrate that it can secure a genuinely additional market.

§ Mr. Tony Benn (Chesterfield)
Has not the Minister now given the whole game away? The subsidy is to encourage privatisation. [HON. MEMBERS: "Rubbish."] Of course it is. Everyone in the mining industry knows that, if a pit is mothballed and offered to the private sector, the private sector will get the benefit of the subsidy and offer to re-employ some miners—some—at lower wages and in poorer conditions than they had before. That is why the Minister's statement last week was simply not believed by anyone. We did not think that he wanted to save jobs; we thought that he wanted to put the mines back into private hands. That is what this is all about.

§ Mr. Heseltine
Talk of giving the game away is rich coming from the right hon. Member for Chesterfield (Mr. Benn), who announced the connector with France without signing up on the details. If anything was given away, it was Britain's mining industry by the right hon. Gentleman.
We will press ahead urgently with our plans to privatise the industry. On any calculations, British Coal, as a private company, would be one of the world's largest coal companies.
I made it clear last Thursday, and I have made it clear from the beginning, that I cannot offer a guarantee about the size of a future market. In deciding not to specify the number of pits for the future, the Select Committee clearly recognised that and agreed with the point that I am making. As the chairman of British Coal said today: I welcome the fact that all collieries have an opportunity to compete for a market that was not available at the outset of the coal review. The subsidy arrangements will therefore enable British Coal to do that. The chairman has made it clear that his 30 company will do all in its power to seize the opportunities that the White Paper makes possible. There is, therefore, now a significant new market to go for. These opportunities are above and beyond those provided by the core contracts.

§ Mr. Patrick Cormack (Staffordshire, South)
I listened carefully to what my right hon. Friend said about the chairman of British Coal. Statements apparently came from British Coal this weekend which gave the clear impression to some people that a number of the 12 pits would not remain open for more than about nine months and that, among those that did remain open, some might well be substituted for the 19 that are not at present on any list. I should be most grateful for any assurances that my right hon. Friend can give on those points.

§ Mr. Heseltine
I am grateful to my hon. Friend. He heard what I have just said about the pits on the list of 12 and those on the list of 19. The chairman of British Coal has made it quite clear, and I could repeat the words, if my hon. Friend the Member for Staffordshire, South (Mr. Cormack) would like me to—[HON. MEMBERS: "Answer."] I will. As I said, the chairman of British Coal said today: I welcome the fact that all collieries have an opportunity to compete for a market that was not available at the outset of the coal review. That is the point that I am trying to put to the House. The subsidy arrangements will enable British Coal to compete for that market which was not available. The chairman of British Coal has made it absolutely clear that he will do all within his power, as will his company, to seize the opportunities that are now available as a result of what the White Paper has made possible.
As I was saying, those opportunities are above and beyond those provided by the core contracts. It is not British Coal's intention that the future of the 12 pits will be secured at the expense of the 19 pits which were outside the scope of the present review. The opportunities for the 12 pits are those of the additional market.
The Government are, as I said in response to an earlier intervention, well aware of the very serious impact of pit closures on mining communities. We have made available to British Coal one of the most generous packages for voluntary redundancy currently available. In October, a substantial package of regeneration measures of about £180 million was announced. I augmented that in my announcement of last Thursday to bring it to around £200 million.
As the House will know, Lord Walker has been appointed to pull together the activities of all the Government Departments and agencies and he has already visited many of the areas that might face closures. The training and enterprise council programme has been agreed in principle by my right hon. Friend the Secretary of State for Employment. Those contingency plans make provision for some 25,000 additional people to be retrained and helped.
British Coal has made it clear that it will act quickly to reclaim sites for development. Enhanced assisted area status has been promised to Doncaster, Barnsley and Mansfield.
In October, I announced that the Government would consider enterprise zones for those areas most affected by closure, should closures be determined by British Coal. I can now go further than that. If there is a substantial reduction in employment at mines in the vicinity of 31 Easington in County Durham, the Dearne valley or Mansfield as a consequence of the proposals announced by British Coal on Thursday, we intend that enterprise zones should be set up in each relevant area. Thus, there could be up to three new enterprise zones.
The zones are intended to provide a focus for regeneration over a wide area. They are expected to generate several thousand new jobs and attract significant new investment over the next 10 years. Their aim is to stimulate the construction of new manufacturing and commercial premises and promote economic diversity by introducing new enterprises. We have promised further help for those areas affected by closure proposals through extension of the regional enterprise grant scheme for small firms in areas not already benefiting.
Last week, I announced financial support for the new east midlands regional development organisation which, among other things, will promote inward investment to the region. Additional money will be available to regional development organisations in the north-east, Yorkshire and the west midlands. English Estates has put together a provisional programme of about 1.5 million sq ft of business and industrial space and acquisition and servicing of 600 acres of land. The programme will support some 18,000 jobs.
I can well understand the anxiety of communities faced with the need to change from their present reliance on coal. I know, as do many hon. Members on both sides of the House, how successful such change can work out to be. The fact is that, during the 1980s, we have seen change introduced and we have seen the results.

§ Mr. Peter Hardy (Wentworth)
One matter of anxiety in the coalfields which the Minister has not yet touched on is the question of safety in the mines. On several occasions in the past six months, the Minister and the Secretary of State for Employment have referred to the desirability of dismantling the safety regulations. The right hon. Gentleman will be aware that that is a matter of enormous concern to the National Association of Colliery Overmen, Deputies and Shotfirers, which sponsors me in the House and which has made an immense contribution to maintaining both safety and production records in the pits. Does he recognise that, if he goes ahead and dismantles safety in the mines, lives will be lost—and it will be on his conscience and that of his colleagues.

§ Mr. Heseltine
When I joined my Department and examined the political issues facing coal, the first thing I said was that I would do nothing to deteriorate—[Interruption.]

§ Madam Speaker
Order. The House must realise that interruptions use up the precious time available.

§ Mr. Heseltine
I sometimes wonder what people who must go down the mines feel when they see the response of the Labour party. The hon. Member for Wentworth (Mr. Hardy) asked a serious and important question to which I was about to give an unequivocal answer. I made it clear that I would do nothing to prejudice safety standards in the mines. That was the first thing I said, and I have remained consistent in that position, although the House fully realises that these matters are, rightly, for the Health and Safety Executive.
32 As the House knows, we are consulting over the 1908 Act. I give the House an assurance that no decision will be taken in my Department which prejudices safety in the mines. I hope that that is as categorical as I can make it. We have seen changes take place before. In many ways, Lord Walker changed the economic opportunities in south Wales. His contribution was proverbial, and Labour Members know exactly how much he did.
When the steel industry faced closure in Shotton, some 7,000 jobs went. But 10,000 new job opportunities were created in the 1980s.
I had to help with the problem of Corby when the British Steel plant faced closure, with a loss of 3,500 jobs. With enthusiastic support—I say it—from the local Labour council, the new town corporation and my hon. Friend the Member for Corby (Mr. Powell), 11,000 new jobs have been created in that part of England.

§ Mr. William Cash (Stafford)
On the jobs issue to which my right hon. Friend is addressing himself, will he give an assurance that if, at the end of the consultation process for Trentham and perhaps some of the other pits, Trentham was privatised, it would have full and free access to all coal purchasers so that it could run its affairs properly, in line with the market forces that my right hon. Friend has considered? Will he please give me an assurance, especially about Trentham, on that point?

§ Mr. Heseltine
My hon. Friend will understand the difficulty of intervening in the statutory procedure for consultation. However, I made it clear to him that any pit —obviously, that includes Trentham—which British Coal determines to close after consultation will be made available to the private sector. I have made it clear this afternoon, and I have said earlier, that if any private sector organisation can find a genuinely additional market for the coal, I shall be prepared to offer a subsidy along the lines of what I have announced so that it can sell the coal.
There is nothing to stop such a private sector organisation approaching the generators in the electricity supply industry. However, my hon. Friend will understand that we are talking about a genuine additional marketplace. Therefore, it would be misleading if I did not say that I would not regard access to the core contracts which have been announced today as a genuine additional marketplace. That would merely have the effect of closing down pits in other parts of the country. I have given my hon. Friend a wide-ranging answer which applies in general terms to other pits which might face closure.
In truth, two fundamental differences of approach have emerged continuously in the debate about coal on the Floor of the House. First, the Labour party, with the significant exception of members of the Select Committee, has refused to engage in any serious discussion of the options. It has set aside any attempt at reasoned arguments, often those of its own members of the Select Committee.

§ Mr. Martin Redmond (Don Valley)
Will the Secretary of State give way?

§ Mr. Heseltine
No.
The Labour party has argued that there is an opportunity for massive intervention in the marketplace that would protect the coal industry from competitive pressure. That is the first distinction between the arguments of the Opposition and those of the 33 Government. The Government believe that energy policy is a matter for a competitive marketplace in which a diversity of supply is on offer to a wide range of customers who, in the exercise of their discretion, will exert a downward pressure on price and continuous pressure for efficiency.
The second gaping divide is the almost unbelievable contrast between the policies Labour Governments have pursued in practice and the pretence which the Labour party now offers about what it believes that we should do. I begin with the concept of the visionary plan which the Labour party tells us about. It could not be more clearly stated. In 1974, the "Plan for Coal" opened with the following ringing sentences": Coal's major role and new importance in the entirely changed energy situation facing Britain is clearly presented in the National Coal Board's Plan for Coal. It is the most ambitious forward strategy ever prepared by the mining industry, calling for £600 million of new investment, first to stabilise and then to expand the nation's coal-mining capacity over the next decade. On page 9 the vision was quantified.

§ Mr. Joseph Ashton (Bassetlaw)
How many tonnes?

§ Mr. Heseltine
As always, the hon. Member has forgotten the figures, but I shall remind the House of them.
In 1973–74, the market of 133 million tonnes was to increase to 150 million tonnes by 1985. To achieve that, the plan was quite specific—new investment of £1.4 billion in the 10 years to 1985. That was the plan, the vision and the certainty. The only thing that has changed is that the hon. Member who had so much to do with the plan has forgotten what he put in it. At best, it was gross naivety and at worst it was a great confidence trick.
I have the figures for 1985. Far from achieving the forecast increase to 150 million tonnes, the figure was down to 118 million.

§ Mr. Benn
The Tories were in office in 1985.

§ Mr. Redmond
On a point of order, Madam Speaker. The President of the Board of Trade is being economical with the truth. Have you the right to tell him to be more correct as he is deliberately misleading the House?

§ Madam Speaker
Order. First, that is not a point of order but a question of debate and perhaps the hon. Gentleman would care to debate it if he catches my eye. Secondly, I cannot accept his remark and must ask him to withdraw it, and not to waste the time of the House further in this serious debate.

§ Mr. Redmond
I withdraw it.

§ Mr. Heseltine
When I gave the figures for 1985, the right hon. Member for Chesterfield observed that the Tories were in power then. At last, I have found something on which I can agree with him. I had anticipated the Pavlovian reaction of Opposition Members. I realised that if I mentioned 1985 it would occur to them that it was all the fault of the wicked Tories. Their broad theory would be that if only we had got on with those plans and had allowed all the good work put in place by the Labour party to continue, as they had intended, all would have been well.
I took the liberty of checking the facts. In 1973–74—when the Tories were certainly in office, as the right hon. Member for Chesterfield will remember—output was 142 million tonnes. In 1978–89, the output achieved under 34 Labour was 119 million tonnes. Far from an increase, far from a plan for coal, all Labour managed was to decrease output by 16 per cent.
Your curiosity will have stretched to what happened to the bills, Madam Speaker. Labour promised to invest £1.4 billion in 10 years, but the actual cash invested was £5.7 billion. The cry will go up—perhaps the Opposition have learnt their lesson as the cry did not go up. All that dramatic increase in investment would have been under the Labour party.

§ Mr. Bob Cryer (Bradford, South)
What about producing 119 million tonnes now, you clever little sod?

§ Hon. Members
Withdraw.

§ Madam Speaker
Order.

§ Sir Jim Spicer (Dorset, West)
On a point of order, Madam Speaker. I am not sure whether you heard that remark and I shall not repeat it, but it calls for a withdrawal, on your instructions.

§ Madam Speaker
I believe that I heard what I thought was an unparliamentary remark, in which case I must ask the hon. Member for Bradford, South (Mr. Cryer) to withdraw it.

§ Mr. Cryer
Certainly, Madam Speaker, I withdraw the word "clever".

§ Madam Speaker
Order. The hon. Gentleman understands that he is using up, as I have said before, very precious time in the debate. I do not want to exchange words with him about the word "clever". [Interruption.] Order. I shall use the authority that the House has given me if the hon. Member for Dover (Mr. Shaw) continues to interrupt in that way. I am sure the hon. Member for Bradford, South will take the matter seriously and withdraw the remark.

§ Mr. Cryer
Certainly, Madam Speaker, I shall withdraw the word "little" and I shall withdraw the word "sod", because we need every vote in the House tonight. That is the only reason, because—

§ Madam Speaker
Order. I need no qualification; I need a withdrawal. The remark was withdrawn. I hope that hon. Members will watch their language in this debate, and any other debate.

§ Mr. Heseltine
I am sorry that the facts of Labour's record should so offend the hon. Member, but it is important that the whole House should understand exactly what they are.
As I have said, the Labour party promised £.1.4 billion; the actual cash invested up to 1985 was £5.7 billion. Of course, the suggestion could be made that all of that had been invested before the Labour party left office. I have checked the figures again. Between 1974 and 1979, the investment in British Coal was £1.5 billion—

§ Mr. Jimmy Boyce (Rotherham)
On a point of order, Madam Speaker.

§ Madam Speaker
Order. I hope that it is a point of order and not a point of frustration.

§ Mr. Boyce
Frustrated as I am, Madam Speaker, I believe that it is a genuine point of order for you.
35 On Thursday, I raised with the President of the Board of Trade the fact that the people facing redundancy were little interested in what happened five years ago, 15 years ago or 40 years ago.

§ Madam Speaker
Order. It must be a point of order for me, not a point of argument.

§ Mr. Boyce
Do we have to listen to this nonsense all over again?

§ Madam Speaker
Order. Hon. Members have a free choice in the House, whether to stay or to remove themselves elsewhere.

§ Mr. Heseltine
I think that the public may feel that the record of the Labour party is relevant to the discussion today. The great claim of the Labour party is that it has backed British Coal, but we have established that it actually ran down production. Its next great claim could be that it invested more than the Tories did in British Coal, but it cannot square that with the fact that when it had its five years, under the "Plan for Coal", it invested £1.5 billion and in the five years when the Tories had control, up to 1985, the figure was £4.2 billion. What we saw was Labour presiding over a declining market and rising costs.
What else should the Labour party have done? It could, of course, have cut back on nuclear power, but the Trade and Industry Select Committee said no to that idea, and the Government also said no. The House may think that I am talking about a Conservative Government, but I am not; the Labour Government said no. They said no on 15 May 1978, when the Labour Government decided: After three years of discussion, the Government believe that the nuclear component is necessary for the energy policy of the United Kingdom; that a Windscale expansion of the kind proposed is necessary for that nuclear component to develop properly."—[Official Report, 15 May 1978; Vol. 950, c. 177.] Who said it? The right hon. Member for Chesterfield.
This should cause the House—even Opposition Members—no surprise, because on 25 June of the same year the same right hon. Member said: All the forward forecasts, which go to the first quarter of the 21st century, indicate a growing role for nuclear power. He was referring to the 20 per cent. about which I reminded the House last Thursday.
What are the facts? We have still not reached 20 per cent. dependence of nuclear power, yet the Labour party, despite its forecasts, is trying to back off. The fact is that the Opposition knew; they had the forecasts; and the only other qualification that they conspicuously possess is a remarkably short memory for the facts.
I need not detain the House long on the interconnector with France. I explained the position comprehensively last Thursday. So careless were the Labour Government with our national interest that they approved the multi-million pound project and authorised the Central Electricity Generating Board to proceed. Does the right hon. Member for Chesterfield want to tell the House that he did not know that the treaty of Rome was in place when he made the announcement? Or were the Labour Government so keen to announce jobs before the forthcoming general election that they sold the principle and left the critical details to the generosity of the French 36 negotiators? Even for the right hon. Gentleman, that seems to be carrying the international brotherhood of man a shade beyond reasonable caution.
Of course, the Labour Government also knew about gas. They could have refused to allow so rapid a development of the North sea. They were the ones with a plan for coal. What was their policy on gas? On 8 December 1975, they said: Our objective, as a Government, has been to seek to do all we can in the national interest to develop gas and oil resources in the North Sea and to secure the situation for the future. That is the basis of a great future of this country." —[Official Report, 8 December 1975; Vol. 902, c. 163.]

§ Mr. Ray Powell (Ogmore)
On a point of order, Madam Speaker. Did I not hear you say that speeches should be short? Does not that apply to Ministers and Front-Bench spokesmen as well as to others who might be lucky enough, if there is still time when this Minister has finished, to be called? Would you bring the Minister to order and remind him of the time factor?

§ Madam Speaker
I have no authority to bring any Minister or Back Bencher to order in that sense. I simply make a plea, in the interests of all in the House, for shorter speeches.

§ Mr. Heseltine
I have deep sympathy with that point, Madam Speaker. I have given way to a large number of hon. Members, and I believe that I should report to the House the views of the Labour Government on gas, because one of the most important criticisms levelled by Labour—but not by the Select Committee on Trade and Industry—contains the idea that we should cut back on gas. So let me tell the House what the Labour Government said about it.

§ Mr. Simon Hughes
On a point of order, Madam Speaker. The motion that the President of the Board of Trade moved related to the White Paper, which is meant to be about the future of the coal industry. Will the President deal with the future and not give us lessons that we, and above all the mining industry, know about the past?

§ Madam Speaker
All Members are responsible for the arguments that they put here. If we could make some progress, I might be able to call other Members to put the opposing arguments.

§ Mr. Heseltine
The hon. Member for Southwark and Bermondsey (Mr. Hughes) must surely be aware—if he is not, his hon. Friends will remind him—that the Select Committee report extensively discussed the issue of gas. It must be relevant to our decisions and our discussions whether the Labour party believed that there was an alternative to cutting back on gas. Let me tell the House what the view of the last Labour Government was about gas. Then we can judge the validity of the criticisms that Labour Members are now making. They said: Our objective, as a Government, has been to seek to do all that we can in the national interest to develop gas and oil resources in the North Sea … That is the basis of a great future of this country. As we move towards the 1980s, we shall be an energy-strong country. We shall be the most important country, in energy terms, in Western Europe, and one of the most well-based in the world. At that point, an intrepid hon. Gentleman asked, "At what cost?", to which the response was: 37 That is a concept for the faint hearts of the Conservative Party to ponder."—[Official Report, 8 December 1975; Vol. 902, c. 163.] Who announced that bold policy of allowing gas its head? It was not, this time, the wild optimism of the right hon. Member for Chesterfield; he is guiltless of that statement. It was a then much more humble figure—the Minister of State, Department of Energy, our old friend, the Leader of Her Majesty's Opposition.

§ Ms Joan Walley (Stoke-on-Trent, North)
On a point of order, Madam Deputy Speaker. Is it not the case that the more rope the President of the Board of Trade is given, the more likely he is to hang himself? Are we not meant to be discussing future energy policy? Is it not the case that he will be consigned to the history books, just as he is now talking about policy of 20 years ago? What matters is now.

§ Madam Deputy Speaker (Dame Janet Fookes)
That is not a point of order for the Chair.

§ Mr. Heseltine
The House will have listened to the debate and to the exchange that we had on Thursday and a wider audience will have listened to the way in which the Labour party has abandoned all that it did when it was in power as though there were a simple way forward.
There is a speech that every right hon. and hon. Member should read. It was made on 20 October last year by Lord Marsh in another place.

§ Mr. Skinner
He is a Tory.

§ Mr. Heseltine
That is their answer: he is a Tory. If he is a Tory, it may well be because he has sat in a Cabinet with the right hon. Member for Chesterfield and learnt the arrant nonsense that was discussed there. Let me quote Lord Marsh.

§ Madam Deputy Speaker
Order. I am sorry to interrupt the President of the Board of Trade, but he may not quote speeches made in the other place unless they were made by a Minister. I am sure that the right hon. Gentleman can paraphrase.

§ Mr. Heseltine
I recognise your ruling, Madam Deputy Speaker. The fact that Lord Marsh should say that the social devastation of what happened under a Labour Government, when he was a Labour Minister, should not be forgotten must rank as a serious part of the discussion about how one judges the integrity of the Labour party.
And so—[Interruption.]

§ Madam Deputy Speaker
Order. It is also a rule of the House that, even though one may disagree violently with the hon. Gentleman who is speaking, one at least gives him a hearing.

§ Mr. Heseltine
It is not that the Opposition disagree with me, Madam Deputy Speaker; it is that they do not want the facts paraded. The Labour party cannot stand the facts because they do not square with the argument that it puts forward today. However, we shall reveal just what the Labour party did when it had the power to deal with these matters.

§ Mr. Kevin Barron (Rother Valley)
On a point of order, Madam Deputy Speaker. The Secretary of State is talking to us about facts. I faxed a letter to the right hon. Gentleman at 7.30 last night in which I asked him to clarify the statement that he made on Thursday, which put 800 miners in my constituency out of work. They were 38 producing some of the cheapest coal at one of the most modern coal mines in the world. I ask the right hon. Gentleman to answer my questions. Must I listen to a diatribe that has nothing to do with the well-being of miners?

§ Madam Deputy Speaker
The hon. Member well knows that that is not a point or order for the Chair. The Chair is not responsible for the substance of speeches.

§ Mr. Heseltine
The hon. Member for Rother Valley (Mr. Barron) refers to Maltby, a mine which British Coal has said that it is considering developing. That will attract investment of £29 million net and extend the life of the pit into the next century.

§ Mr. Nicholas Winterton (Macclesfield)
Does my right hon. Friend recall that in October 1992 I asked him about the inbuilt discrimination against coal in the Electricity Act 1989, the measure which privatised the electricity industry? He gave me an assurance that he would consider that "inbuilt discrimination" as part of his review. Has he done that? If he has, and has found the discrimination that I believe to exist, why is he not acting to produce a level playing field between coal, gas and nuclear power?

§ Mr. Heseltine
My hon. Friend must be fully aware, as the Select Committee determined and as I have made clear, that we are considering an immensely complex range of options. I have listed the areas in which we are helping British Coal, both with a subsidy to help it bid for markets and by widening the market for coal. It is a naive interpretation of what has happened to believe that British Coal has not received subsidies over recent years. There is about £1 billion a year of subsidy over and above world market prices in British Coal's current costs, and there was about £18 billion-worth of investment in British Coal in the 1980s. I cannot accept what my hon. Friend has said.
We have provided British Coal with the opportunity to earn additional tonnage through supplemental contracts. We have given it the opportunity to compete. We have provided it with a wider market. Without Government action, that market would not be there. What has been the response of the National Union of Mineworkers? It wants to call a strike. Does the hon. Member for Livingston (Mr. Cook), the Opposition Front-Bench spokesman, believe that the NUM serves its interests by going on strike? What will the customers of British Coal think if they see the industry going on strike at the very time when we are giving it a chance to compete in larger marketplaces?
We have made it clear that the best hope for British Coal is to take advantage of the opportunities that we have provided and to move towards the private sector. We have seen privatised industry after industry move on to the world stage and win new markets. That has been the success of the 1980s. We want British Coal to seize the opportunities that are there.
All we have from the Labour party——

§ Mr. Redmond
Will the right hon. Gentleman give way?

§ Mr. Heseltine
From the Labour party we hear only references to the past and to subsidies. It continues to look backwards. That is all that it does. The House has heard its message, which has nothing to do with a viable and competitive British industry. I am sick and tired of listening to Opposition Members telling me what their fathers thought, what their grandfathers thought, and 39 what their great grandfathers thought. We are concerned about what their children will think if we do not make the economy competitive. We are not trying to build a land for the fathers of Opposition Members but we are determined to build a land for their children.

§ Mr. Robin Cook (Livingston)
I beg to move, to leave out from 'House' to the end of the Question, and to add instead thereof: 'declines to approve the White Paper, The Prospects for Coal, on the grounds that it fails to provide a long-term future for any of the 31 pits announced for closure on 13th October or to secure a contract for a single extra ton of coal above those contracts available on 13th October; notes that the reduction in contracts for coal is a product of the distorted market created by Her Majesty's Government on the privatisation of electricity and regrets the failure of the White Paper to open up the electricity market to fair competition from coal; records its surprise that despite a new subsidy on the purchase of coal Her Majesty's Government has not obtained any commitment from the generating companies to purchase more coal; is concerned that the White Paper will impose severe hardship on the communities around the 19 pits to be closed immediately and the further 12 pits liable to close within three years; recognises that the British Coal industry is the cheapest and most efficient in Europe; congratulates the management and workforce of the 31 pits on their achievement in doubling productivity within eight years while reducing the price of their coal; and calls for a balanced energy strategy that maintains existing volumes of coal production.'. I understand why the President of the Board of Trade did not spend the bulk of his speech talking about his White Paper. Having read it, I think that he was probably right not to do so. I also think, however, that on this occasion he could have spared the House his portrayal of a pantomime villain. I have shadowed the right hon. Gentleman for long enough to know that he plays it for the boos and the hisses—that that is what gives him his high. Hon. Members should not misunderstand me; there is a place for pantomime villains. As a child of 10, I loved to boo and hiss them as much as the next person. But the place for a pantomime villain is on the pantomime stage, not on the Floor of the House introducing a report that seals the fate of a major strategic industry and the jobs of 30,000 grown men—men of dignity and courage, who deserve better of the right hon. Gentleman than his vamping performance today.
The right hon. Gentleman has spent five months on his review, being as self-indulgent as his performances in the House. The critical reason why he has failed to come up with a long-term solution to the problem of the pits in Britain is simple. Why has he not produced a White Paper that gives a future to those 31 pits? Has he never thought that he was wrong in wanting to close them in the first place?
I thought that, after Thursday's statement, the hon. Member for Teignbridge (Mr. Nicholls) asked the most penetrating and revealing question of all. He asked the President of the Board of Trade to confirm that his conclusion was that the economic analysis that my right hon. Friend made last year was right then and is right now. Modestly, the right hon. Gentleman replied: my hon. Friend is right."—[Official Report, 25 March 1993; Vol. 221, c. 1250.]

§ Mr. Patrick Nicholls (Teignbridge)
Will the hon. Gentleman give way?

§ Mr. Cook
I shall give way in a moment.
We could not have had a clearer answer. The thousands of people who wrote to Conservative Members last October were wrong; the quarter of a million who marched to Hyde park for the miners were wrong; the 1 million who signed petitions for the pits were wrong. They had all got it wrong. The right hon. Gentleman knew better than they and was not going to change his policy.

§ Mr. Nicholls
If the hon. Gentleman had gone on to remind the House of the rest of the exchange that he quoted, hon. Members would recall that I said that we had taken care of the social consequences of an economic analysis that had not changed.
While the hon. Gentleman ponders on that, may I ask him a question? Will he repudiate strike action on the part of the miners, or does he actually believe that it expands the market for coal?

§ Mr. Cook
I shall have something to say about strike action in a moment. [HON. MEMBERS: "Answer!"] I shall answer the hon. Gentleman in the course of my speech, but let me say first that we did not come here to debate the social consequences of closing pits; we came here to debate how those pits could be kept open. [Interruption.]

§ Mr. Nicholls
rose——

§ Madam Speaker
Order. The hon. Gentleman knows the rules.

§ Mr. Cook
I shall not answer the hon. Gentleman's question; I shall answer the President of the Board of Trade, who asked the same question. His question deserves an answer.
The right hon. Gentleman's statement last October did for Arthur Scargill what none of us believed possible: it made him more popular than the current Prime Minister. His statement last week has now achieved something that Arthur Scargill himself never achieved: it has persuaded the Union of Democratic Mineworkers to ballot for industrial action. That is the scale of the betrayal felt by those who work in the pits—not just members of the National Union of Mineworkers, but UDM members. [Interruption.] Conservative Members are barracking, asking from a sedentary position whether we support such action. If they support us tonight in defeating the White Paper, there will be no need for a strike.
The President of the Board of Trade has spent five months on his review and in that time he has learnt nothing.

§ Mr. Heseltine
Why does not the hon. Gentleman answer the question?

§ Mr. Cook
With respect, I have already answered it. I fully understand and share the anger of those who were led to believe that there would be a solution and now find that there is none.
The President of the Board of Trade may have learnt nothing in the course of those five months, but at least he started off knowing rather more than his Prime Minister, who accused me on Tuesday of wanting to fossilise coal. I hate to admit that I have ever been beaten to action, but I must tell the Prime Minister that 1,000 ft of pressure have beaten me to it by 1 million years. How can we take 41 seriously a review of the coal industry's future from a Government who still do not understand that they are dealing with a fossil fuel? We cannot take it seriously, because the right hon. Gentleman has not come up with one extra bag of coal to be bought from the pits that he claims to have saved.
Let us be objective and let us be fair to the President of the Board of Trade. That was the test that he set himself and put to the House repeatedly: his task was to secure an extra market for coal. In his speech, he asked what those who go down the pits will think of Opposition Members. Let me point out that they do not include him, for he has not been down a single pit in the course of his review. When I asked him, during Question Time last week, why that was, he replied that his presence was more important where those who can enter into contracts with British Coal may be found.
That was the test that the right hon. Gentleman set himself: where could he find extra contracts for British Coal? According to that very test, his White Paper is a failure. It does not contain a single contract for a single extra bag of coal.

§ Mr. Jim Lester (Broxtowe)
What would those who go down the pits have felt if my right hon. Friend had not been able to announce today that he had secured the core contract?

§ Mr. Cook
They told him what they felt on 13 October, when he announced precisely the same core contract as he has announced this week. There has not been an advance of as much as 1 million tonnes on the contract that justified his decision to close the 31 pits. Now, five months later, we are asked to accept that the same tonnage will save 12 of those pits.

§ Mr. Philip Oppenheim (Amber Valley)
Will the hon. Gentleman give way?

§ Mr. Cook
No. I have given way already.
The right hon. Gentleman's argument is that, by providing British Coal with a subsidy that brings down the price of the coal at the pits concerned to that of imports, the Government will be able to replace imports with the output of those pits.

§ Mr. Oppenheim
Will the hon. Gentleman give way on that point?

§ Mr. Cook
No; I want to finish this section of my speech.
The problem with that logic is that the output of the 12 pits exceeds the total volume of imports. In the year now ending, they have produced 13 million tonnes. Next year, Britain is expected to import 9 million tonnes for electricity generation. Contracts have already been signed for 2 million of those tonnes, leaving a balance of only 7 million tonnes. Even if the output from those pits displaced every last tonne of imports for which no contract has yet been signed, there would be room only for 7 million tonnes, or the output of half the 12 pits that the President of the Board of Trade claims to have saved.
That is the position this year; next year will be worse. Next year, the core contracts go down from 40 million to 30 million tonnes. In that year, British Coal will have to find extra output not just for the 13 million tonnes from the 12 pits, but for the additional 10 million tonnes lost on the core contract. That is a total of 23 million tonnes. Yet, 42 in that year, the total volume of imports expected is only 10 million tonnes. How will a subsidy help British Coal to find the other 13 million tonnes? If it does not find them, how will the 12 pits stay open beyond next April? I will give way to the President of the Board of Trade if he will answer that question.

§ Mr. Ted Rowlands (Merthyr Tydfil and Rhymney)
As well as asking that vital question, will my hon. Friend ask another? What credence can we give to the process of consultation about the 10 pits that are not even included in any of the figures? If my hon. Friend's figures are right, what hope or belief can there be in the integrity of the whole inquiry and consultation process, which could save Taff Merthyr and other collieries among the 10?

§ Mr. Cook
There has been no offer to privatise them; it has been a clear-out sale.
The President of the Board of Trade has had time to think of his answer, so I shall give way to him. Now that we have demonstrated that the output of those 12 pits exceeds imports, can the right hon. Gentleman explain to us where the market is for their output? Who is going to buy the 13 million tonnes?