Small Business, Enterprise and Employment Bill

Baroness Verma Excerpts

Wednesday 11th March 2015 Lords Chamber

Moved by

[Baroness Verma]

81A: After Clause 155, insert the following new Clause—
“Concessionary coal
(1) This section applies to an entitlement to concessionary coal or payments in lieu of concessionary coal—
(a) arising in connection with employment by a company which on 1st January 2014 was carrying on the business of deep coal-mining in the United Kingdom, and(b) which is not being met otherwise than by virtue of this section.(2) The Secretary of State may, out of money provided by Parliament, make such payments as the Secretary of State considers appropriate for the purpose of securing that an entitlement to which this section applies is met.
(3) Payments under this section may be made only with the consent of the Treasury.
(4) “Concessionary coal” means coal or other solid fuel supplied free of charge or at reduced prices.”

[Baroness Verma (Con)]

My Lords, Amendment 81A provides the Government with an enabling power under which to provide support to persons with an entitlement to concessionary coal, or cash in lieu of concessionary coal, in accordance with the rules on regular and proper expenditure. This entitlement arises in connection with employment at UK Coal Production Ltd, UK Coal Kellingley Ltd and UK Coal Thoresby Ltd.

In November 2013, the Government assumed responsibility and met the costs associated with the lost concessionary fuel allowances of a previous cohort of UK Coal under the Supply and Appropriation Act. Unfortunately, the same basis could not be used for concessionaires at Kellingley and Thoresby collieries because this cohort, when taken in conjunction with the last, exceeds the £1.75 million per annum threshold permitted by the Act. It is therefore necessary for the Government to take a new, bespoke power to enable this support provision to continue.

The persons covered by the power are employees, redundant persons, retired persons and in some cases, depending on the terms of contract, dependants of such persons. A dependant will not have direct contractual entitlement to concessionary coal or cash in lieu with the company. However, their entitlement would be referable to a right in the employment contract. These entitlements must be contractual entitlements. In particular, the company must have been carrying on the business of deep coal mining on 1 January 2014.

The UK Coal group has been restructured on a number of occasions. In January 2015, UK Coal Production Ltd submitted a request for support in relation to the managed run-down of its last two deep mines—Kellingley and Thoresby. Around 730 employees will be affected by the run-down. This important provision provides the reassurance that the Government are able to act quickly to meet the concessionary fuel entitlements of persons affected. Amendment 83A to Clause 162 simply provides that the clause will commence automatically, two months after the Bill receives Royal Assent. I hope that noble Lords will support the inclusion of these important amendments and I beg to move.

[Lord Grantchester (Lab)]

I thank the Minister for her explanation of the amendment. Even if today the closure of a mine is not of the significance that it was a generation ago, it is still an important matter to the industry, to the local community around the pit and to the people directly involved. It is right that the Government should be able to provide appropriate support in this amendment through concessionary coal payments.

The amendments in this group are welcome as they can help to provide assistance at a time of great anxiety and stress to employees, who will appreciate the security that they can provide. In order that these concessionary coal payments can have some certainty as well, I ask the Minister if she can provide a bit more clarity on certain points with regard to subsection (3) of the new clause proposed by Amendment 81A, concerning Treasury consent. I understand that her department is preparing to submit these proposals for clearance under state aid rules. Does this mean that this enabling power could never be needed should the Treasury refuse to sanction her department’s submission? What would be the scope of that decision? Is it likely to lead to a reduction in the concession?

I understand from my honourable friend Tom Greatrex in the other place that the Minister, Matt Hancock, has promised to submit the proposal before Dissolution. I would be grateful if the Minister can confirm that commitment tonight and make the announcement before Parliament rises. For the comfort of the people who will be nervous of their situation in the coalfield, can she provide as much information as possible concerning how long she would envisage clearance to take on this state aid submission to the EU? Every week that goes by without state aid, the sum required actually increases. Should clearance be received before Dissolution, will she make the commitment that this will be announced to Parliament? However, should clearance not be received before Dissolution, can an announcement be made between Parliaments? Clarity and certainty in her assurances will be vital to those in these vulnerable communities.

[Baroness Verma]

My Lords, I am extremely grateful to the noble Lord, Lord Grantchester, for his support for the amendments. He raised a couple of questions which I hope I will be able to clarify. The Treasury has confirmed that it will meet the entitlements, although the reinstatement remains conditional, as the noble Lord is aware, on the Government securing the necessary approvals, including one from the Commission. We can assure concessionaires that entitlements will be reinstated, as they have been in the past, on the same terms and conditions.

We will be discussing state aid aspects with the Commission at the earliest opportunity and will formally notify the concessionaires as soon as practicable. The state aid clearance processes can take time, as the noble Lord is aware, so it is difficult for me to provide your Lordships with definitive assurances at this time. We will discuss, of course, with the Commission at the earliest opportunity to ensure a prompt and smooth clearance process. I reassure the noble Lord that no concessionaries will suffer loss as a consequence of any inertia in the process. Entitlements will be backdated, as they have been in the past, should any delays arise. I am extremely grateful to the noble Lord for his support and I hope that my response has satisfied him.

Amendment 81A agreed.