Skip to main content

Oral Answers Toquestions

Volume 959: debated on Monday 4 December 1978

The text on this page has been created from Hansard archive content, it may contain typographical errors.

Energy

Electricity Supply Industry

asked the Secretary of State for Energy when he intends to bring forward a Bill to reorganise the electricity supply industry.

The Government's commitment to reorganisation of the electricity supply industry was reaffirmed in the Queen's Speech. I am considering arrangements for introducing legislation in the light of the Select Committee Report and comments made upon it.

Is not the main reason why the Bill was not successful a long time ago the Secretary of State's insistence on certain parts of the Bill to which there are objections by both unions and management? What is he going to do about it?

No, that is not so at all. The hon. Gentleman is misinformed. It is not my Bill. It is the Government's Bill, brought forward and published on behalf of the Government containing a number of proposals which, among others, are designed to safeguard the rights of the House of Commons. The Government are anxious to proceed with the Bill. I am happy to make it clear that I accept, as I must at this stage, that the implementation of the first order could not occur in this Parliament anyway, so there should be no party controversy in that sense. I am happy to consider constructive amendments arising out of the points highlighted by the Select Committee, but I do not think that, in all the circumstances, the House has any reason to doubt that I am very anxious, as are the Government, to get ahead with the Bill and to invite the House to consider it in Committee, which must mean that it would have a Second Reading.

Does my right hon. Friend agree that, in view of the present voting situation in the House of Commons, both the Select Committee on Nationalised Industries and the trade unions have suggested that a simple Bill on structure alone should be introduced leaving other, perhaps more important, matters to be dealt with in a Bill on more general powers?

No, Sir. I think that my hon. Friend has got it wrong. The Committee recommended that there should be legislation in this Session. It made no recommendation whatever on any of the other matters, though it did highlight them. Given that a number of proposals are being circulated for this industry which my hon. Friend would not support, I am sure he will agree that the Government must have a Bill which they would be ready themselves to support. It is not just a matter of putting the whole business into commission.

Is my right hon. Friend aware that, as a member of Sub-Committee B of the Select Committee on Nationalised Industries, I am pleased to hear that he will take account of the recommendations that it has made. Is he aware that there is a great lowering of morale in the electricity supply industry over the delay in reorganisation? Will he do his utmost to get the Bill before the House as soon as possible?

Yes, I certainly will. 1 think my hon. Friend will recognise that one of the proposals, namely that the industry should be completely reorganised in favour of power boards, which is a perfectly legitimate argument, would not increase the sense of confidence in the industry nor would the proposal put forward, I understand, on behalf of the Liberal Party, that it was wrong to make a change at all. It would be a gross oversimplification to say that the Government are holding back the Bill. We are anxious to proceed, but, given the fact that we are a minority Government, we require the good will of a sufficient number of hon. Members to give us a Second Reading. If that were the case, the spirit in which we would approach the Committee stage would be the one that I have indicated.

Natural Gas

asked the Secretary of State for Energy what estimate he has made of the effect of the surplus of natural gas expected in the next 10 years on the market for electricity and coal in the United Kingdom, and the effect on the rate of return on new investment in the electricity and coal industries.

Markets for gas are expected to be able to absorb the quantities provided for in present plans. We do not expect a surplus of gas to arise over the next 10 years.

Does not my hon. Friend think that something should be done to restrain Sir Denis Rooke, the chairman of the British Gas Corporation, from his present dumping policies in relation to the fuel economy of this country? If there is a surplus of natural gas, and it is generally argued that there will be, should not this be exported, because there is a big world market for natural gas?

We are not aware of any dumping of gas. Normally, the complaint that we receive is that gas is too expensive, particularly in the industrial sector. The price of gas in the industrial sector is related to the market price, which in our case is the world price for light fuel oil. In the domestic sector gas has made a big impact and we expect that it will continue to do so, but in no sense could my hon. Friend say that there was a dumping policy. As for exports of gas, if it turned out, as my hon. Friend says, that there was a large surplus—I emphasise that we do not expect that to be so—of course that would have to be considered.

But does not the Minister accept the estimates that there will be a surplus of gas during the 1980s? If that is correct, have any approaches been made to, say, Total that gas from the Frigg field should be exported to France by way of a gas grid along the lines of the proposed electricity exchange system?

No one should assume that reports about large excesses of gas are accurate. We expect that the supply will expand from about 4,000 million cu ft a day to about 6,000 million cu ft a day by the mid 1980s, but we expect that gas to be taken up by the domestic market.

Is it not a national scandal that millions of our most vulnerable citizens—the elderly, the low income groups and the sick—face a winter of further hardship and real danger to health because they cannot buy enough heat, yet the Government continue to subsidise investment in new power stations which will throw away twice as much heat as they will produce in electricity?

That has absolutely nothing to do with the Question about gas, and I do not accept any of the remarks which were the preamble to the hon. Gentleman's supplementary question. He is well aware that we have a code of practice, the discount scheme, the Supplementary Benefits Commission and the DHSS, all of which can help people who are on low incomes and suffering difficulties with fuel bills.

Is my hon. Friend aware that a recent reply from his Department revealed that 386 million cu ft of gas are being flared off every day in the North Sea? Is not that a disgraceful state of affairs? Will he take the necessary steps to restrain the oil companies' urge to exploit the oil which is down below, thus wasting the heritage of future generations?

It is interesting that in one question it is argued that there is a surplus of gas, in another that it is too cheap, in a third that it is too expensive and that now my hon. Friend is saying that we should take all possible action to obtain more of it. I agree with him that we should do that. It is for that reason that flaring consents have been brought under stringent control by the Minister of State. At least one major oil operation has been closed down and we have denied the company and ourselves the oil until we are satisfied that everything possible is being done to prevent gas flaring and to recover an important resource. But we can do that only where it is economic to do so.

In view of the differing opinions about gas pricing, is it the Minister's view that gas at the moment is being realistically priced?

In industrial markets, as I have said, gas is priced in relation to the price of light fuel oil. That is a market operation that is controlled by the British Gas Corporation. We do not seek to intervene in that way. In the domestic sector, it is well known that the price of gas has fallen in real terms. That clearly is of great benefit to gas consumers—contrary to what the hon. Member for Derbyshire, South-East (Mr. Rost) said.

Several lion. Members rose——

North Sea Oil (Refining)

3.

asked the Secretary of State for Energy what is his latest estimate of the proportion of North Sea oil from United Kingdom fields which will be refined in United Kingdom refineries in 1978

.

During the first nine months of 1978, the most recent period for which data are available, 56 per cent. of oil production from the United Kingdom continental shelf was refined in the United Kingdom. The Department estimates that a similar proportion will be refined here during the remainder of 1978.

In view of the under-utilisation of United Kingdom oil refineries, what action will my right hon. Friend take to improve that figure even more? Will he assure us that he will resist any EEC interference with this country's right to insist on the landing of North Sea oil in Britain?

The answer to the second part of the question is"Yes ", but I think my hon. Friend would be the first to concede that the so-called two-thirds rule is best expressed in the words of the then Secretary of State for Energy in 1974 that

" we might reasonably expect up to two-thirds of North Sea oil to be refined in the United Kingdom."—[Official Report, 6th December 1974: Vol. 882, c. 647.]
We must make sure that the disposal plans, the refinery plans, and so on, are in the national interest. It is not always the case that actually refining the oil here is necessarily in the national interest. However, we are conscious of my hon. Friend's problem over the refinery on the Isle of Grain, and have expressed strict views to the chairman of BP that we expect to be consulted before any major decisions are taken about the refinery position.

Does the two-thirds rule apply to BNOC and also to Deminex, the Germany company, or will they be exempted?

We cannot give figures for individual companies or for BNOC, because that would be a breach of commercial confidentiality, but the rule applies across the board.

Coal Industry(Pit Closures)

4.

asked the Secretary of State for Energy what powers he has to delay or to prevent the closure of coal mines in areas of high unemployment.

30.

asked the Secretary of State for Energy what action is proposed on threatened coal pit closures in South Wales.

The closure of collieries has been traditionally a matter for the National Coal Board after full consultation with the unions under the colliery review procedure. As I announced in a parliamentary answer on 8th May, I have suggested that closures should be mutually agreed between the National Coal Board and the unions, and some discussion on this proposal has taken place.

Is my right hon. Friend aware that at Telford New Town in my constituency, where the closure of the Granville colliery has been proposed, unemployment is running already at nearly 10 per cent. and that 392 further job losses have been announced in recent weeks? If the Granville colliery closes, the situation will be very serious indeed. What measures can he take to prevent or delay that?

I am aware of that case. I have had some informal discussions with my hon. Friend about it. The right course is that it should be done under the colliery review procedure agreement between the National Coal Board and the NUM. There are circumstances—this has happened in the past—in which the NUM may bring a case to me. It was rather in that context that I made my proposal.

Does my right hon. Friend agree that the NCB is now producing the cheapest coal in the EEC? As the coal industry in Britain has been subsidised to a lesser extent than has the industry in any other EEC country, will he consider suggesting, in discussions with the NCB, that we should subsidise coal to ensure that those pits where there are known coal reserves, such as the Deep Duffryn colliery in my constituency, are kept open to get the coal to the surface?

On the wider question of the future of the British coal mining industry, as I have said before, our subsidies to the mining industry in 1977 amounted to£75 million, while subsidies in Germany amounted to£2,788 million in a single year. According to figures published by the Commission, our coal costs £22 a ton to mine, German and French coal costs £38 a ton to mine and Belgian coal costs £52 a ton. It would be absurd, with coal playing such an important role in the future of this country's industrial activity, if we were not to maintain the mining industry while the investment programme goes through, so that we can take advantage of it. That is why we have gone for the coalburn scheme. I think that there is a growing body of opinion all over the world that coal will be one of the key bases for industrial development when oil and gas run out.

When can we expect the long-awaited decision in respect of the closure of Teversal colliery in North Nottinghamshire?

I am reluctant to engage in the House in discussion of individual pits, for the reason that I have given, namely, that there is a proper procedure and that where necessary the NUM can come to me and I can raise the matter with the NCB. So perhaps the hon. Gentleman will excuse me from that. But the general arguments that I have just given about the need for the mining industry to develop its resources and utilise the skill of its people are, in my judgment, unanswerable. I have never found the NUM in any way unreasonable where closures are necessary because of exhaustion or because pits are out of line in economic terms.

Will the Minister confirm that all this talk about glowing optimism for the coal industry needs to be backed up by selling coal? Currently there are more than 35 million tonnes of coal on the ground. I suggest that one of the main tasks is to increase the demand for coal. To that end, why do not we ensure that we keep the solid fuel market in Northern Ireland, instead of making proposals to get rid of it?

As my hon. Friend knows, his latter point is not a matter for me, but I agree with him entirely that the most sensible thing to do is to provide an additional market for coal. It is for that reason that we have recently announced the £17 million scheme for an additional coalburn over the winter. That will not only burn some of the coal in stock but will reduce by about £60 million the imports of coal and oil, and reduce by about £50 million the public sector borrowing requirement needed to finance the stocks of coal which otherwise would not be burnt. I think my hon. Friend will find that Government policy is in line with what he is suggesting.

The Minister referred to his proposal that any closures should be subject to the joint agreement of unions and management. To that extent, he would appear to be giving the NUM a veto over any proposed pit closures. Although we fully support the arrangements for discussions and consultation on possible closures, is it not a fact that in the end it must be the management's responsibility to manage, and that any other course would be disastrous?

I take note of what the hon Gentleman says. The reality is that we cannot run the mining industry without the good will of the NUM and the National Coal Board. That good will should extend towards the widest area of mutual agreement. Closures, which have a sensitive history, are a part of an area of policy on which, now that we have a planning agreement and regular tripartite meetings, I hope that agreement will be reached. I think that that makes sense.

Oil Policy

5.

asked the Secretary of State for Energy if he will make a statement on current oil policy.

The Government's current oil policy and energy strategy are described in the Green Paper published in February this year. These matters are kept under review by the Energy Commission, which considered last Friday a discussion paper by my Department on our offshore oil policy. I am sending the hon. Member a copy. Next year, and, I hope, annually thereafter, the Government will publish an updating of the Green Paper and present it to Parliament.

I am grateful to the Secretary of State for that answer. Will he disregard some of the phoney propaganda which is coming from the oil companies in relation to the non-profit-ability of Scotland's offshore oil resources? Will he realise that the same tactic of gloom and doom was pursued during the passage of the Oil Taxation Bill and the Petroleum and Submarine Pipe-lines Bill? Will he make sure that there is no question of the petroleum revenue tax not being uprated as the Government suggested earlier?

I am grateful to the hon. Gentleman for his retrospective warning to me not to be put off by an obvious oil company campaign which I noticed in the newspapers. If the proof of the pudding is in the eating, the fact that we had a 100 per cent. application for the blocks that we put on offer and that 55 companies applied, compared with 53 last time, indicates that only the oil companies and the hon. Member for Bridgwater (Mr. King) appear to have any doubts about our policy.

Does my right hon. Friend agree that the response to the latest round of applications was extremely encouraging and gave the lie to the Tory Opposition's claims that this would be a deterrent to further exploration? Does he also agree that there is an excellent case for increasing the oil revenue tax, which would allow the Government to abolish all television licences and to do many other worthy things?

I shall not be tempted by my hon. Friend into answering the latter part of his question. Perhaps I might appeal, even to the Opposition, to recognise that the oil companies expect any British Government to defend our interests and extend and increase the control over our oil. When we do that, it does not help to find that any little oil company public relations campaign is amplified and echoed by the Opposition. In the event, we have had a highly successful sixth round of applications. We have done it on the basis of a very much stronger oil policy than we had even a few months ago, and, of course, indescribably stronger than the weak-as-water policy that we inherited from the previous Government.

Is the Secretary of State satisfied that the smaller companies which are bidding in the sixth round have the financial strength to carry through satisfactorily the necessary exploration?

It is true that smaller companies have applied. One of the arguments, and I was not unsympathetic to it, was that there should be scope for smaller companies to go forward. They will be assessed on the basis on which anyone would expect the Government to assess applications. The fact that there is interest on the part of the smaller companies and of the bigger ones indicates that the strong and determined oil policy operated by the Government is not a deterrent to investment in the North Sea. It is most unwise of people to suggest that it will be.

Is the Secretary of State aware that the test of an effective national oil policy is whether it will fully safeguard the nation's interests, while at the same time obtaining for the nation the maximum skills and expertise which are present within the whole international oil industry? Against that yardstick, will he notice that his sixth round, so far from being the success that he claims, has seen the substantial abstention of four of the most helpful and constructive oil companies which have already made a major contribution? Will he accept that the figures are characterised by a considerable fall in the size and scope of the companies present in the sixth round? Will he further agree that what will not help the oil policy is the evidence of the drop in the exploration rate, which is there for all to see, and that he cannot deny that? What is needed is a measure of confidence and trust that assurances given by the Government will be maintained.

As the sixth round was the most successful round of applications for licences that we have had, in terms of coverage, of applications for blocks, and the number of companies that applied, I was somewhat surprised that, after months of making speeches saying that the sixth round would be a failure, the hon. Gentleman found himself locked with Exxon, which does not really need his help, on the occasion of the announcement of the round, in saying that it had not been a success.

The truth is that the oil companies are looking ahead for five to 10 years or more. The North Sea is infinitely the most stable area politically in the world. I find it hard to believe that it can be in the interests of this country that every time an oil company, as part of a bargain and a negotiation—which I do not mind at all—puts out press statements designed to improve its short-term bargaining position, the full weight, such as it is, of the hon. Gentleman should always be available to it. The hon. Gentleman's forecast was wrong this time, just as it has been wrong on every other occasion since the beginning of the oil policy.

Energy Conservation

6.

asked the Secretary of State for Energy what plans he has for encouraging further energy conservation in British industry.

A substantial programme of energy saving measures, aimed in part at industry, was announced in December 1977, and further measures were announced in June 1978. Our present priority is to ensure that these measures are effectively implemented. Our energy conservation policy is a continuing one and we keep under review the scope for further or improved measures.

I am glad that the Minister keeps the policy under review, but is he aware that a document published by his Department recently showed that British industry could save up to 30 per cent. of its energy consumption if present technology was cleverly applied? Is the Minister satisfied that enc ugh is being done on things such as waste heat recovery, industrial combined heat and power, and heat pumps?

As the hon. Gentleman is quoting from the report which I initiated, I agree with what he said at the beginning. The question that he rightly posed was why industry is not getting on with the job. We have allocated about £22 million to aid investment in new or improved existing technology, and we are looking for industry to come to us with proposals.

Does my hon. Friend agree that, while it is necessary to conserve energy in general, in particular we should be conserving oil and trying to find alternatives to the use of oil? What is the Department doing along those lines, for instance, in regard to the electrification of the railways and the production of alternative supplies of power?

We have published position papers on alternative supplies of energy from the so-called benign sources. The electrification of British Rail is a question for my right hon. Friend the Secretary of State for Transport. We constantly examine the subject of oil substitution. One of the ways in which oil is being substituted is by the use of gas—a matter which we discussed earlier.

Cross-Channel Electricity Links

7.

asked the Secretary of State for Energy if he will make a further statement on the development of cross-Channel electricity links

Discussions of detail on the technical and commercial aspects of the cross-Channel link are continuing between the CEGB and Electricité de France. I have, however, nothing to add to the reply given by my right hon. Friend to the hon. Member for Thanet, East (Mr. Aitken) on 3rd August, when he indicated that the British Government had approved the link in principle.

Will my right hon. Friend accept that, although we all welcome the announcement which was made in the summer, rapid progress is required in this area of activity? Does he agree that development of these links is vital for the medium-term market for coal and also for the electricity generating programme?

Yes, Sir. The link is planned to come into operation in stages. The first 1,000 megawatts will come into operation in 1982 and the second in 1983. We have assumed for the purposes of appraisal a life expectancy of 30 years.

Does"Channel"in this context include the North Channel? If not, will the Government see that that link also is borne in mind in view of the contribution that the Kilroot power station could make to electricity supplies in the United Kingdom generally?

I expected the right hon. Gentleman to ask me that supplem1entary question. As I said on the last occasion when this matter arose, we are looking favourably at such a proposal. Unfortunately, we have not got quite as far on that matter as we have on the matter that is before us in this Question.

Will the fact that the new extension to Dungeness is not now to be built affect this decision? Will the Minister bear in mind that there are already two sets of high-tension lines across Romney Marsh and that the inhabitants of the area will not welcome a third?

I am not sure, without notice, about the third part of the hon. Gentleman's supplementary question, but in reply to the first part the answer is that it does not affect the position of the station. The cables go from Folkestone to Sangatte and power will be fed into the national grid at Sellinge, which will be linked to the Folkestone terminal by an underground DC cable. That is the only information I have before me on this matter.

Fluidised Bed Combustion

8.

asked the Secretary of State for Energy how much is currently being spent on the development of a fluidised bed combustion system by the Central Electricity Generating Board, by his own Department and by private industry, respectively.

The Department of Energy expects to spend some £11 million in the current financial year. Private industry expenditure is not known with any certainty but it is likely to be in the region of £0.5 million. Expenditure by the CEGB is not separately identified but is comparatively small, being concentrated on co-operation with the National Coal Board and Babcock and Wilcox in the planning of a demonstration plant for pressurised fluidised bed combustion.

In view of the importance of this technique in the consumption of coal in relation to reducing pollution and the burning of very low quality coal, is my hon. Friend satisfied that these rather meagre sums are adequate? Should there not be more of a sense of urgency in the development of this technique?

I can assure my hon. Friend that I am very keen to get on with this development. If he examines the little red book—the working party's report—he will see that this matter is spelt out. Furthermore, a scheme is being undertaken by the National Coal Board in conjunction with Babcock and Wilcox and the CEGB. In regard to total cost, the National Coal Board is taking the lead in this matter, but from a national point of view a sum of about £4 million is being invested.

Is not the truth of the matter that the CEGB is not interested in the fluidised bed technique, whereas many utilities abroad are beginning to show an interest? It is felt that we may lose this technology as we have lost others.

The hon. Gentleman is being unfair. He must know that in the development by the NCB and Babcock and Wilcox the CEGB has agreed to undertake the engineering.

Atomic Energy Authority Police

9.

asked the Secretary of State for Energy how many police officers are now employed by the United Kingdom Atomic Energy Authority; and what was the number 12 months ago.

There are 511 police officers now employed by the United Kingdom Atomic Energy Authority; the number 12 months ago was 469.

Will my hon. Friend confirm that all applicants for employment with the Atomic Energy Authority are vetted for security by the Authority's constabulary? What access, if any, do individuals who are the subject of police files have to this information so that they can discover whether inaccuracies have arisen? Can my hon. Friend say whether this information is made available to other Departments of State?

In regard to the first part of my hon. Friend's question, I think that the background of individuals will be questioned and examined. On the subject of files, I cannot give him the information he seeks. However, since my hon. Friend attaches great importance to this matter, I shall endeavour to write and give him the best available information.

European Community(Ministerial Meetings)

10.

asked the Secretary of State for Energy when he expects next to meet his ministerial colleagues in the EEC.

17.

asked the Secretary of State for Energy when he intends next to meet other EEC Energy Ministers.

20.

asked the Secretary of State for Energy when he expects next to meet other EEC Energy Ministers; and if he will make a statement

I expect to meet other EEC Energy Ministers at the next meeting of the Energy Council, which is provisionally arranged for 21st December. I am also arranging a series of meetings with three Commissioners who have expressed an interest in the development of various aspects of British energy policy.

When the Secretary of State goes to the Council, and assuming that a suitable opportunity arises, will he confirm to his colleagues that he recognises that concerted moves at a European level are now a necessary part of seeking a limitation on oil imports from outside the area of the Community by, say, the mid-1980s? Is he satisfied that enough is being done in this regard?

I strongly favour co-operation with our European colleagues, but the only meaning I can read into what the hon. Gentleman says is that we should deplete our own North Sea oil resources at a rate designed to replace imported oil. That is not the view of Her Majesty's Government. It does not make sense to suppose that, if one transfers power from any member State to the Commission, that is of itself any advantage in the development of sensible Community policies.

Will my right hon. Friend take the opportunity at that meeting or others to make it abundantly clear that the British Government will continue to oppose any interference by the Common Market in our policies on oil, gas or coal? Will he also make it clear that this should be interpreted by those in Brussels not as Ministers displaying any anti-Market sentiments but as defending proper British interests?

I made a speech at the last Energy Council, and I received a consent to release the statement I made. I made that statement available on Friday and it is in the Library. I set out in that statement my attitude on these matters. I do not regard it as being hostile to the development of energy policy in the Community that member States should be able to develop their own policies and safeguard their own interests. I have never complained once in the past three and a half years at the energy policy pursued by any other member States. I would not expect them to complain about us.

Is my right hon. Friend aware that it has been suggested in many circles that Ministers who take a strong anti-Common Market line on the Continent are sometimes being outflanked by the Prime Minister in top-level negotiations? Will my right hon. Friend watch out for any sinister developments of that kind in his own Department?

I cannot comment on that proposition, but I noticed that The Guardian this morning started to reshuffle Ministers, on similar lines to its reshuffles of the letters in the words that it prints.

Will my right hon. Friend take the opportunity to discuss with his European counterparts the implications of the decision of the European Court on 14th November, which appears to show that the Community owns our fissile materials and is responsible for the movement of those materials and for the defence of the atomic energy establishments in this country?

Our Law Officers are carefully examining that judgment—and I advise hon. Members who are interested in European matters to read it—which appeared to imply that the Commission had the power through Euratom to look after the fiscal safeguards of our sites and to control the ownership and movement of fissile or special material. I took the opportunity on Friday of having a talk with Commissioner Brunner on another aspect of the matter—namely, the interpretation of chapter 6 of the Euratom treaty. I think that these are substantial matters on which the House would not want me to give an answer until I have had a chance of examining them more fully.

Will the Secretary of State have words with the Nigerian Minister or Commissioner for Oil and Energy before he goes to the EEC in order to see whether the Commonwealth supply of oil from Nigeria—production of which is well down on previous years—could be used by certain of our Commonwealth partners in order to help them in their oil requirements and save them from having to look towards British oil to meet their needs?

I shall look at that point. However, the argument is not about the sale of oil from the North Sea. Most of the exports go to EEC countries. The only question is the control of oil policy. That is the key question, and on all the other matters about co-operation in the moment of crisis and so on we are working very well. However, I believe that each member State inevitably will require —as the Germans, the French and ourselves are doing—to retain control over its energy policy. That has nothing whatever to do with the reluctance to sell oil or other materials.

Is it not a fact that the Secretary of State's tactics at recent meetings have done nothing to advance the agenda which has been before the Council of Ministers on each occasion? Has this not meant, in effect, that the Secretary of State has delayed British coal export markets because of his attitudes and tactics? Is it not a fact, for examples, that both Denmark and Belgium import coal from outside member countries? Why does not the Secretary of State do something about helping the market for British coal in those countries?

The hon. Member is wrong in supposing that the argument about a coalburn scheme has anything whatever to do with the tactics of Ministers. Many countries in the EEC have access to cheap Polish coal, and we cannot persuade them to spend more on buying Community coal in pursuit of Community interests. This has nothing whatever to do with the tactics of Ministers or with the attitude to refineries. The losses of the French refineries are attributable to the fact that the French Government insist that oil reaching France comes in French ships. We have stood firm on refineries and we are trying to get a coalburn scheme agreed.

I have had discussions with Count von Lambsdorff recently and with the British and German coal chiefs, who came to my office. We are pressing this matter as hard as we can. The Under-Secretary has been raising it for 18 months, but so far we have been unable to get other countries to agree to the scheme.

Will my right hon. Friend tell us his policy in the Energy Council towards the specific Commission proposals for subsidising infra-Community trading in power station coal?

I have strongly supported the development of a coal policy and the coalburn in the EEC. However, there are certain schemes for coalburn in the Community which would impose a net cost upon us because they would be primarily directed at the coking coal side, where German subsidies are at £2,788 million a year. These are complex matters to deal with in question and answer. I would welcome a chance for a debate on EEC energy policy as soon as it could be arranged in the House.

How can the Secretary of State say that this is not a question of tactics by Ministers when he has already admitted that it would have been far better if the coalburn scheme had been brought up before the question of refineries arose? Was it not a failure on the part of Ministers and the British Government in not getting this scheme agreed a long time ago? It would have brought enormous benefits to the coal industry of this country in view of the very heavy stocks that we have at present. Is it not a final condemnation of the Secretary of State that with the very strength that we have in energy, which should enable us to take advantage of the situation in Europe, he has totally failed to bring back any benefits for this country?

The hon. Member is totally wrong. Our position in the EEC is that we are overwhelmingly the biggest contributor in energy terms, and this makes us the foundation of a successful EEC energy policy. We raised the question of the coalburn scheme earlier. I then agreed to the Euratom loan scheme in order to show our readiness to agree, but in response the coalburn scheme was not agreed. It must be an acceptable scheme which benefits this country as a major coal producer. I beg the hon. Member not to pick up every tittle tattle of criticism in Brussels and amplify it in such a way as to seek—as he consistently does —to undermine the interests of this country in the EEC and elsewhere.

Overseas Development

Developing Countries (Assistance)

41.

asked the Minister of Overseas Development what action has been taken to maintain an effective and increasing programme of assistance to developing countries

The aid programme is growing by 6 per cent. a year in real terms under decisions already announced. By 1981–82 it will be 40 per cent. larger than in 1977-78. Our aid strategy is to assist the poorest countries and the poorest people.

Would not the cause of world peace and progress be better served if we diverted less expenditure to arms and increased expenditure on solving the problem of world poverty, in view of the fact that two-thirds of mankind are suffering from want?

I agree entirely, and so do my colleagues in Government. This is evidenced by the fact that expenditure on defence has been cut compared with that on overseas aid, which has been increased.

Is not there a fundamental inconsistency in the Government's policy? The aid policy tries to encourage Third world industry, but the trade policy veers in a protectionist direction, preventing those same industries from having sufficient access to our markets.

I know that the hon. Gentleman is fully aware of the complexities of these matters. There can be contradictions and a danger of contradictions. The Government are concerned to avoid a policy of protectionism while at the same time safeguarding particular industries in this country which are vulnerable. In general, in our international negotiations we pursue a policy of liberalisation of trade to benefit the developing countries.

Is my right hon. Friend aware that, in spite of all her welcome efforts in writing off debts, the Lome convention negotiations are making it clear that our EEC partners are not prepared to open markets to the underdeveloped countries? Is she aware that the Lome countries are exceedingly angry at the way in which the negotiations are proceeding?

I note what my hon. Friend has said. The Lome negotiations, which are essentially a matter for the Foreign and Commonwealth Office and are not for me, are in their early stages. People are stating their positions. I do not think we can say that negotiation has begun.

Can the Minister tell us what action she and her Department are taking to assist the new Government of Ghana, with their more liberal economic policy under General Akuffo?

We have recently announced a considerable programme loan to Ghana. If I have the opportunity in early January, I hope to include Ghana in my visit to West Africa.

Developing Countries (News)

42.

asked the Minister of Overseas Development what representations she has made to the United Nations regarding the proposals discussed in UNESCO that news from the developing countries should be restricted.

During the nine days which I spent at the UNESCO general conference I made clear the Government's views on the draft declaration on the mass media. I think that our representations played an important part in bringing about the consensus which was eventually reached. We and our Western colleagues, with the support of many of the nonaligned countries, succeeded in removing from the final declaration any reference to State control of the media, of journalists, or of the flow of information. Indeed the declaration positively reaffirms the principle of freedom of the Press.

I have begun consultations on how the United Kingdom can give practical help to the developing countries to strengthen and expand their media; and we shall also co-operate in any UNESCO initiatives to this end.

As freedom of information and freedom of the press, with a view to seeking the truth, are matters upon which we cannot equivocate, both in regard to our own affairs at home and in relation to other countries, is the right hon. Lady fully satisfied that this cardinal principle has been fully embodied in the UNESCO agreement and that it is not a woolly consensus which does not mean anything at all?

It is a slightly woolly consensus, but I am satisfied that it avoids any of the references to State control of the media which would be intolerable to us and many other countries. It is a negative achievement. We have succeeded in getting a declaration which is harmless but which may have some positive good effects in that any journalist who finds himself in difficulties anywhere in the world will be able to quote what was agreed in Paris. There is a certain amount of positive achievement and nothing left in it is dangerous to our principles.

Does my right hon. Friend agree that the Third world has some reason to be anxious because the major international news gathering agencies are owned, controlled and directed from the Western world? Could she spell out a little more her suggestion that we are prepared to help Third world countries to do a little news gathering and dissemination on their own account?

It may be helpful if 1 put in the Library my initial speech to UNESCO. My hon. Friend will discover that it dealt with some of these matters and with the problem of developing countries which find that they need, economically, State subsidy of their media, but do not necessarily want to translate that into State control. There are many areas—I mentioned them in my speech—in which one can provide practical assistance to the Third world in developing its media and a counter force to the pressure, that one understands clearly, of Western interests.

While welcoming what the Minister has said about the improvement in the UNESCO communiqué and her view of it, may I ask whether she can hold out any hope that UNESCO will be able to bring pressure to bear to achieve a more positive attitude by developing countries to the freedom of the press? When the right hon. Lady talks of assistance for these countries, will she consider insisting, as a prerequisite, that they accept a free press?

We cannot insist on anything. That has to be clear. However, UNESCO and countries such as ourselves, as bilateral aid agencies, can assist in areas that will help the Third world countries to develop their media, free from the concept of State control. That is the objective. Many practical things are possible, but much work needs to be done. I have considerable consultations, not only with the United Kingdom commissions to UNESCO, but with people in the media, and we shall try to develop a programme of assistance to the Third world and its media which we can press upon UNESCO and a good deal of which we may be able to do ourselves.

India

43.

asked the Minister of Overseas development to what extent she is directing aid to India to deal with the growing problem of small farmers becoming marginal farmers and marginal farmers becoming landless labourers.

I am aiming to use more United Kingdom aid directly to assist agricultural development especially of the poorest groups such as those referred to in my hon. Friend's Question. I am also anxious to ensure that we give all possible help to the development of industrial and infrastructure projects, such as fertiliser factories and power generation, which provide essential inputs for agricultural development. We are, of course, also providing 318 mobile clinics to assist health programmes in the villages of India.

Has my right hon. Friend studied the statement made a few months ago by the Overseas Development Institute? I give a warm welcome to her widening her decisions on aid to infrastructure and co-operative societies of all kinds, not just for agriculture, which makes village life more liveable.

I welcome very much the new programme of the Government of India. I know that they are meeting great difficulties, but the programme is geared towards a greater emphasis on the poorest people, and if our aid programme can be concentrated on the necessary infrastructure we can really be of assistance.

European Development Fund

44.

asked the Minister of Overseas Development what share of contracts arising out of expenditure from the European Development Fund has been won by British firms between 1976 and 1978; and if she will make a statement.

Figures produced by the Commission show that up to 31 st March 1978 British firms had won 7·5 per cent. of contracts awarded under the fourth EDF. If contracts awarded to ACP firms are not included, the figure becomes 10·3 per cent. Since we contribute 18·7 per cent. to the EDF, this is disappointing, although we do all that we can to encourage British firms to compete for EDF contracts.

I am grateful to the right hon. Lady for that reply, but I believe that many of my hon. Friends feel that a great deal more could be done to encourage British firms to do better. Is she aware that many firms, particularly in the construction and civil engineering industries, believe that the Government support given to them in tendering for contracts is substantially less than that avail- able to firms in, for example, France, Germany and Italy? Will she get together with her right hon. Friend the Secretary of State for Trade to work out an effective programme for supporting British firms in fighting for these contracts, particularly in the Francophone countries in Africa?

One of the problems has been that the fourth EDF came into operation only in 1976 and many of the early contracts were in Francophone countries where our firms had very little experience. I shall certainly draw the hon. Gentleman's remarks to the attention of my right hon. Friend the Secretary of State for Trade. Much has already been done. The British Overseas Trade Board's intelligence service does all that it can. Commission officials come to London and there have been conferences, but one must accept that part of the problem is due to the degree of British competitiveness.

Is my right hon. Friend aware that there may be grounds for thinking that the machinery is not particularly efficient? It is noticeable that Francophone firms and Francophone African companies seem to get more benefit out of the machinery than do the British. Is my right hon. Friend convinced that the machinery is working efficiently and that the Commission knows what it is doing?

I shall never be fully convinced that that is so. There is a need to explore the possibility of greater cooperation and better exchange of information between the Commission and ourselves. In terms of the normal arrangements for acquainting British firms of the contracts that might be awarded, a great deal is being done. Sometimes British firms do not adequately notice what information is made available to them. That is one problem.

Competitiveness in price and delivery dates are crucial, and that is so not just in terms of EDF contracts, but in relation to contracts all over the Third world. However, I am prepared to agree with my hon. Friend that more co-operation between ourselves and the Commission might be helpful.

My hon. Friend the Member for Norfolk, North-West (Mr. Brocklebank-Fowler) has raised a most important question. As our share of the contracts of the EDF is most unsatisfactory, will the Minister have a proper look at the machinery and make sure that British industry is adequately warned, well in time, before contracts are put out?

I have already done that. A conference in London was attended by Commission officials and representatives of United Kingdom firms. Commission officials also took part in a conference organised by the CBI. Everyone at the top level of British industry knows what is happening. The difficulty—and here I step slightly outside my own field—is that it is not just a matter of the top people in industry knowing. We have to get the information down to the middle level of firms that might compete. That is not a matter for me.

Malawi (Forestry Project)

46.

asked the Minister of Overseas Development whether she remains satisfied with the proposed level of British commercial participation in the future exploitation of the British funded Vipyha forestry plantation project in Malawi.

I understand that no definite decisions about participation have yet been taken by any commercial interests, which, of course, are not my responsibility.

Does this not go back to the previous Question? Have not the Malawians expressed some surprise that a British funded project should be attracting so little interest from British firms in terms of subsequent commercial exploitation? Why should the Germans and other countries have been making all the running on a British project?

I do not think that the hon. Gentleman is quite right in his assessment. It is not that any other countries, or firms from other countries, are expressing great interest in the project. As I understand it, although this is not directly within my responsibility, Malawi has not yet managed to interest anyone in the commercial viability of the pulp mills that would follow from our forestry interests. I hope that it will succeed in doing so. Indeed, I hope that our own firms will get involved. But it is commercial viability that is involved, not competition from other countries.