MPs reach uneasy compromise over pit closures

THE LABOUR chairman of the Commons trade and industry committee came close to resigning during heated final deliberations over tomorrow's report on pit closures, it was disclosed yesterday.

It also emerged that British Coal will appeal against a High Court ruling that its decision in October to close the 10 most threatened mines was unlawful.

The resignation threat by Richard Caborn, MP for Sheffield Central, came amid two adjournments for opinions to cool in the run-up to the unanimous report finally agreed. The outcome is likely to be a masterpiece of drafting, enabling both Tory and Labour members to emerge with political reputations intact.

There has been agreement on the need for a cash injection to slow down moves towards the so-called open market in coal purchase, which could ensure extra production of around 15 to 16 million tons for electricity generation, plus an additional 3 million tons for the industrial market.

Other solutions listed for consideration that could further enlarge the market are curbs on imports of French electricity and the Latin American fuel orimulsion, stopping gas-fired stations from operating on a 'base-load' basis, and scaling down opencast mining.

Implementation of all the options could signal extra production of up to 30 million tons - enough to save most of the 31 pits and thousands of jobs. But the legal and political arguments involved in doing so will allow Tories to claim that, realistically, only about half the threatened pits can be saved.

Even on that basis, the report is still likely to be at odds with less ambitious Cabinet committee proposals, said yesterday to be making 'good progress'.

Last-minute additions to the committee's report are understood to have included, however, a Labour amendment insisting that any pit scheduled for closure should enter the colliery review procedure. That would mean a delay in shut-down of up to nine months.

The report also calls for Nuclear Electric to cease receiving any income from the fossil fuel levy to ensure that the money is used for its original purpose of decommissioning. The levy should instead be vested in a trust fund.

The report will call for part of the levy to be diverted to fund a time-limited pounds 550m-a-year subsidy to enable British Coal to match world prices. But that might get a lukewarm reception from the Government, while causing anxiety among environmentalists.

British Coal's decision to appeal the High Court's ruling was attacked by Mark Stephens, the lawyer acting for the mining unions, who said British Coal had failed so far to consult with miners on the future of the 10 collieries.

But a British Coal source said the company was concerned that in future any management act would be subject to judicial review if employees disagree. This could cause chaos if British Coal attempts to change working practices, which management regard as essential to the company's viability.