Tory rebels look set to retreat: List of mines that could be saved will be presented alongside White Paper

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The Independent Online
AS FEW as half a dozen Tory backbenchers are likely to revolt over today's White Paper on the future of the threatened coal mines, the Government believes.

In spite of industry scepticism over speculation that more than a dozen pits could be saved by the White Paper, one Whip said only about six members of the 30-strong coal group of MPs were expected to defy the Government in a debate next week.

While that could change, Downing Street emphasised that the Government was confident it would win.

Efforts to present government plans in the best possible light continued as arrangements were made for British Coal to present a list of mines that could be saved to coincide with today's unveiling of the paper to MPs by Michael Heseltine, President of the Board of Trade.

Mr Heseltine will also pre-empt the Government's longer-term privatisation plans by announcing proposed new deregulation laws for small and specialist mines, enabling them to be speedily offered to the private sector unencumbered by restrictions on miners' working hours.

It is likely to be emphasised that British Coal must find a market for the output of the 21 mines reviewed.

That in turn will depend heavily on the scale of Treasury subsidy to enable British Coal to compete with cheap imports. A subsidy figure per ton will be included in the paper, but a global sum is not expected.

Until recently, National Power and PowerGen, the two main generators, had suggested they would buy up to 43 million tons of coal over four years. But one electricity source said that the decision to impose VAT on domestic fuel bills made any extra deal 'more difficult,' adding that the possible sale of British Coal mines to other companies 'colours the waters' for the generators.

A further problem is that the European Commission will want to be sure that private miners are able to sell their coal and are not suffering at British Coal's expense.

According to a senior electricity executive, it remains difficult to see any economic reason for keeping open the mines. He said: 'It would be a considerable act of faith to keep open the pits. It seems to be stretching hope as far as hope can be stretched.'

A major stumbling block in saving mines and jobs is that productivity has improved dramatically in recent months. British Coal has become increasingly frustrated that the Government has not made significant attempts to expand the coal market at the expense of nuclear power or gas.

British Coal's list will not refer to the 10 pits most at risk. A coal source stressed that they are not included in the review and are the subject of a separate consultation procedure.

In the wake of reports that the Treasury subsidy will be limited to two years - expiring just when more gas stations come on stream and 17.5 per cent VAT is charged on fuel bills - the emphasis among Tory coal rebels has shifted towards the durability of the rescue package rather than numbers of pits.

But amid claims that the Government had devised a 'short-term political fix', views among MPs attending a coal group meeting yesterday were reported to be 'very mixed.'

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