Coal Bill attacked for failing to give proper cover on subsidence: Surveyors point to 'inadequate' pledge

THE BILL to privatise British Coal has been attacked by the Royal Institution of Chartered Surveyors for failing to give enough protection against subsidence damage.

The Coal Industry Bill is due for its second reading in Parliament today.

The RICS said: 'Householders must be protected against the costs of subsidence damage should one or more of the new private mining companies go out of business. We urge the Government to underwrite all legitimate claims for subsidence damage that private companies may not meet.'

The institution said promises made in the Bill that claimants for damage will be protected as far as is practicable are 'totally inadequate'.

The surveyors are also demanding clarification about who will be responsible for preventing any mining-related water pollution or water damage to land and buildings. It also wants assurances that the freehold of the coal reserves will be retained by the state, giving the private sector only the rights to occupy and work the mines. The RICS said that the Bill as it is now drafted is confusing on the issue of coal ownership.

Private mining companies are also concerned about uncertainties in the Bill and the level of liabilities they will be required to take on should they buy part of British Coal. One worry is what will happen to British Coal's contracts with National Power and PowerGen if British Coal is broken up as expected. Another fear is over what will happen to producers when those contracts expire in 1998.

An industry source said that potential buyers will be further deterred by the limited reserves in some of the mines for sale and the cost of redundancies and site restoration when mining eventually ceases. The cost of cleaning up a former mining site is typically around pounds 3m.

The Government, which has said it will sell British Coal in up to five regional packages, hopes that the Bill will go through by the summer, allowing British Coal's assets to be offered for sale later this year. However, its passage through Parliament is expected to be stormy with opponents highlighting sensitive issues including health, safety and the future of the company's pension funds.