DTI considers Budge company collapse as pit crisis worsens

The Department of Trade and Industry is considering publishing reports into the collapse of a former company run by the Budge family, including the role played by Richard Budge, who later bought most of England's deep mines. As Chris Godsmark and Michael Harrison report, the move could intensify pressure on Mr Budge, chief executive of RJB Mining, as the group moves towards mass redundancies and pit closures.

According to senior sources, the DTI is looking into the 1992 collapse of AF Budge, the family construction and mining company of which Mr Budge had previously been a director. It comes as ministers face increasing criticism that the Government has done too little to prevent a looming wave of pit closures, with the anticipated loss of around 5,000 jobs.

AF Budge went bust in 1992 with debts of pounds 96m. A BBC Panorama investigation into the affair in 1995 alleged that Coopers and Lybrand, the administrative receivers, had considered some dealings by Mr Budge, while at AF Budge, were "in contravention of the Companies Act."

The receiver's conclusions landed on ministers' desks as the DTI was about to sell most of the coal industry to Mr Budge. A subsequent National Audit Office probe found no evidence that the DTI's privatisation unit had sought to influence the decision not to take action against Mr Budge.

Last year three other former directors of AF Budge, Tony Budge and Janet Budge, Mr Budge's elder brother and sister-in-law, along with Michael Yates, were disqualified from acting as company directors.

Separately yesterday, as RJB directors met in London to consider the coal crisis, it emerged that Mr Budge is to appear before MPs on the Commons Trade and Industry Select Committee on Wednesday. He is expected to face questioning on which pits are most likely to close, including the fate of the threatened Selby "superpit" complex.

John Battle, the Energy Minister, has also been called before the committee and will insist that the DTI has taken action in recent weeks to create a level playing-field to safeguard the market for British coal.

An RJB spokesman declined to comment on the board meeting, which is thought to have agreed to press ahead with moves to cut production capacity to match falling demand. "All we can say is that we are keeping events and developments under review," said the spokesman.

Meanwhile, National Power warned yesterday that forcing the three big coal-fired generators to increase emergency stockpiles of coal at their power stations would be a short-term fix that would not solve the RJB crisis and would penalise its shareholders.

A spokesman said that because of the mild winter National Power's current coal stocks were above minimum security levels laid down in law but also those it normally maintained for commercial reasons.

He also pointed out that if the generators were obliged to increase coal stocks they would have to issue open tenders not only to RJB but other UK coal producers and importers. There would also be a problem of where to stockpile the coal, given the high levels of power station stocks. The three fossil fuel generators - National Power, PowerGen and Eastern - consume enough coal a year to cover 115 miles of the M25 to a depth of 15 feet.

All three generators are due to give evidence before the Commons trade and industry select committee tomorrow. None are understood to have been approached by the Government to discuss a bail-out of RJB. PowerGen, the only one still to agree new coal contracts with RJB, has no negotiations planned for this week.

Outlook, page 25

Start your day with The Independent, sign up for daily news emails
Life and Style
love + sex
Arts and Entertainment
Victoria Wood, Kayvan Novak, Alexa Chung, Chris Moyles
tvReview: No soggy bottoms, but plenty of other baking disasters on The Great Comic Relief Bake Off
Ashley Young celebrates the winner for Manchester United against Newcastle
footballNewcastle 0 Man United 1: Last minute strike seals precious victory
Life and Style
Tikka Masala has been overtaken by Jalfrezi as the nation's most popular curry
food + drink
Arts and Entertainment
Seth Rogan is one of America’s most famous pot smokers
filmAmy Pascal resigned after her personal emails were leaked following a cyber-attack sparked by the actor's film The Interview
Benjamin Netanyahu and his cartoon bomb – the Israeli PM shows his ‘evidence’
ebooksA special investigation by Andy McSmith
Arts and Entertainment
80s trailblazer: comedian Tracey Ullman
Life and Style
A statue of the Flemish geographer Gerard Kremer, Geradus Mercator (1512 - 1594) which was unveiled at the Geographical Congree at Anvers. He was the first person to use the word atlas to describe a book of maps.
techThe 16th century cartographer created the atlas
Arts and Entertainment
Stephen Tompkinson is back as DCI Banks
tvReview: Episode one of the new series played it safe, but at least this drama has a winning formula
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Ashdown Group: Graduate Application Support Analyst

£25000 - £30000 per annum + benefits: Ashdown Group: A global leader operating...

Reach Volunteering: External Finance Trustee Needed!

Voluntary post, reasonable expenses reimbursed: Reach Volunteering: Would you ...

Christine McCleave: FP&A Analyst

£36,000 - £40,000: Christine McCleave: Are you looking for a new opportunity a...

Recruitment Genius: Sales Executive - OTE £40,000

£15000 - £18000 per annum: Recruitment Genius: This is a great opportunity for...

Day In a Page

War with Isis: Iraq's government fights to win back Tikrit from militants - but then what?

Baghdad fights to win back Tikrit from Isis – but then what?

Patrick Cockburn reports from Kirkuk on a conflict which sectarianism has made intractable
Living with Alzheimer's: What is it really like to be diagnosed with early-onset dementia?

What is it like to live with Alzheimer's?

Depicting early-onset Alzheimer's, the film 'Still Alice' had a profound effect on Joy Watson, who lives with the illness. She tells Kate Hilpern how she's coped with the diagnosis
The Internet of Things: Meet the British salesman who gave real-world items a virtual life

Setting in motion the Internet of Things

British salesman Kevin Ashton gave real-world items a virtual life
Election 2015: Latest polling reveals Tories and Labour on course to win the same number of seats - with the SNP holding the balance of power

Election 2015: A dead heat between Mr Bean and Dick Dastardly!

Lord Ashcroft reveals latest polling – and which character voters associate with each leader
Audiences queue up for 'true stories told live' as cult competition The Moth goes global

Cult competition The Moth goes global

The non-profit 'slam storytelling' competition was founded in 1997 by the novelist George Dawes Green and has seen Malcolm Gladwell, Salman Rushdie and Molly Ringwald all take their turn at the mic
Pakistani women come out fighting: A hard-hitting play focuses on female Muslim boxers

Pakistani women come out fighting

Hard-hitting new play 'No Guts, No Heart, No Glory' focuses on female Muslim boxers
Leonora Carrington transcended her stolid background to become an avant garde star

Surreal deal: Leonora Carrington

The artist transcended her stolid background to become an avant garde star
LGBT History Month: Pupils discuss topics from Sappho to same-sex marriage

Education: LGBT History Month

Pupils have been discussing topics from Sappho to same-sex marriage
11 best gel eyeliners

Go bold this season: 11 best gel eyeliners

Use an ink pot eyeliner to go bold on the eyes with this season's feline flicked winged liner
Cricket World Cup 2015: Tournament runs riot to make the event more hit than miss...

Cricket World Cup runs riot to make the event more hit than miss...

The tournament has reached its halfway mark and scores of 300 and amazing catches abound. One thing never changes, though – everyone loves beating England
Katarina Johnson-Thompson: Heptathlete ready to jump at first major title

Katarina Johnson-Thompson: Ready to jump at first major title

After her 2014 was ruined by injury, 21-year-old Briton is leading pentathlete going into this week’s European Indoors. Now she intends to turn form into gold
Syrian conflict is the world's first 'climate change war', say scientists, but it won't be the last one

Climate change key in Syrian conflict

And it will trigger more war in future
How I outwitted the Gestapo

How I outwitted the Gestapo

My life as a Jew in wartime Berlin
The nation's favourite animal revealed

The nation's favourite animal revealed

Women like cuddly creatures whilst men like creepy-crawlies
Is this the way to get young people to vote?

Getting young people to vote

From #VOTESELFISH to Bite the Ballot