Tag: David Penhaligon

  • David Penhaligon – 1978 Speech on Cornish Tin Mine Closures

    Below is the text of the speech made by David Penhaligon, the then Liberal MP for Truro, in the House of Commons on 11 May 1978.

    This is the story of two tin mines in my constituency and some 750 jobs. The background is that in 1971 the Consolidated Gold Fields Company opened a mine not many miles from the village where I live. In 1974 a company called the Cornwall Tin and Mining Company opened one no further than a mile from the first mine, called Mount Wellington. Between them they provided some 750 jobs. In our area they were good and well-paid jobs. They were welcome and represented the whole hope in an area where unemployment is nearly endemic. The last figures I saw gave the average unemployment for my county as 11 per cent.; for men it is over 14 per cent.

    I have elicited that there is not a labour exchange within 40 miles of Chacewater, the village nearest these mines, which has today a male unemployment rate of less than 10 per cent. In this area there simply are no other jobs. There is certainly not a single job on offer which pays anything like the national average wage.

    My involvement with this matter started about a week or so before the first mine announced its closure when certain things I heard made me put down parliamentary Questions to find out what was happening and whether the Government knew what was happening at the Mount Wellington mine. Eventually there was a meeting in Zurich where the directors announced that the mine was to close.

    No more than two or three days later the Consolidated Gold Fields company made a similar announcement that its mine also was to close. The reason given at the time by Consolidated Gold Fields was that the water which had undoubtedly been a substantial problem in Mount Wellington, pouring in at some 8 million gallons a day, would follow the laws of gravity and quickly invade its mine. The cost of pumping this water out was understood to be £500,000 a year.

    I must admit that it was this more than anything else which raised by suspicions and made me decide to launch a major attack in this place to find out what was happening.

    There is no doubt that Consolidated Gold could have applied for temporary employment subsidy, and, virtually at the drop of a hat, received some £420,000—at an annual rate. It would have given those in the locality some time to judge the matter and negotiate matters instead of looking down a gun barrel, as we have been doing ever since this announcement was made.

    Indeed, Consolidated Gold was recruiting labour up to two weeks before its closure and I have long suspected—we shall probably never know—that the truth is that the company has been running this mine for some seven years with considerable managerial difficulties. It has had four or five managers since I have been the Member for Truro.

    It is difficult to know whether mining is likely to be profitable; one never knows exactly what one will get until the mineral is dug out. Besides that, the pound is oscillating. But, for all that, last year some £6·8 million worth of minerals were produced—950 tons of tin, 3,300 tons of copper, 3,250 tons of zinc and just over 1·4 tons of silver. The value of this on the metal exchange was nearly £7 million. Besides that, it must be remembered that Mount Wellington was making its own contribution as well. These mines make a significant balance of payments contribution, especially bearing in mind the number of people involved. They have some strategic significance, too, as Cornwall has Europe’s only supply of tin.

    The absolutely horrifying secondary effects hardly need quantifying. The companies used outside contractors for all the painting, surface digging and building operations. They bought some £1½ million worth of supplies locally. The men themselves had a purchasing power of £2 million to £3 million.

    The local reaction was swift and strong. Some 600 miners and their families came to London. They announced that they were prepared to give up next year’s increment in pay—a substantial offer in these days of inflation.

    The Cornwall County Council, which is not famous for throwing away money, quickly offered some £20,000 to enable the pumps to be run for a more substantial period while the problem could be studied sensibly. No wonder: in my village, if these mines totally collapse, I shall have 40 per cent. male unemployment. In the villages of Threemilestone, Crofty and St. Day the situation will be little better. The issue has not been off the local radio and television screens since it was first announced.

    Cornwall has become cynical about the treatment given by the Government to its problems. Large sums of money are going to the steel and car industries. We argue that our problems are no different. This is a basic industry providing basic employment.

    We hope that our treatment will be different on this occasion. Certainly I must admit that the Minister has kept me extremely well informed since this saga started. I believe that on this occasion the Government are prepared and willing to give help. I know that they are now negotiating with other parties. There are problems of confidence in disclosing exactly what is happening and during the period of negotiation it is an absolute impossibility to give a blow-by-blow account publicly.

    I should like some assurances from the Minister making it clear to people in my part of the country that the local appearance that these mines are lost is not the case, and that there is real and genuine help on the way. One rescue plan mentioned is that the shafts that run from Wellington towards Wheal Jane should be plugged, and that some extra pumps should be installed in Wheal Jane to hold back the water that is bound still to leak. Obviously there would be some ancillary piping and this would cost a capital sum of some £600,000, including a considerable contingency in case some of the estimates have gone wrong. The actual operating cost increase in Wheal Jane is estimated at £100,000.

    Facts in this case have been difficult to elicit, but as I understand it—and I have been assured on this point by some of those who work for the company—in the quarter before this terrible thing ​ happened to my county the company was making a positive cash flow. Basically the company has developed and was ready to take the ore from what is called the ninth level in that mine. It had been driving a shaft down to the fifteenth level and had in fact reached a depth of 1,300 ft.

    There is now considerable anguish in the area, as the negotiations go on behind closed doors, about the company’s action in dismantling some of the facilities underground. There is a suspicion that the rescue operation is getting more difficult by the hour. There is no doubt that some substantial sums of money will be required. The company, Consolidated Gold Fields, negotiated, in June 1976, a loan of £2·5 million I have never been clear why that loan was not taken up, but it was negotiated and has never been used.

    Let me warn the Minister that the alternative will be the loss of 700 or even 1,500 jobs. The Department of Employment officials, in an interview, told me that if the mines closed, they might be prepared to use the area for a special temporary employment subsidy scheme. One can imagine the cost and the loss of income tax, rates and national insurance contributions.

    Above all, there is the fear of living in an area with 40 per cent. unemployment and of being defeated and demoralised. Because of Cornwall’s history, mining is more important than the number of jobs involved. There is all the mythology of mining—”Poldark” and the other series of which people are aware—and these mines represented in my area a feeling that there would be growth in employment. The mines were new and we welcomed the general upturn in the growth of the Cornish mineral industry.

    If nothing is done about these mines, I believe that the hope of any outside investment in Cornwall is finished. There will be no hope of persuading any of the large mining corporations to come to my county. The Government, despite my opposition, have saved a considerable amount of money by scrapping regional development grants for the mining industry in development areas. Perhaps some of that money could be used to assist my county.

    I wish to put a number of questions to the Minister. Where do we stand in regard to pumping arrangements? I take the view that we are still fighting this battle and stand a reasonable chance of winning so long as the pumps are kept running. Will the Minister let my constituents know precisely what are the future pumping arrangements? How hard are the Government trying to rescue the position? Will he give some idea of the progress of negotiations? I recognise the difficulties, but what progress has been made in real terms?

    Will the Minister also say what will happen if the negotiations with interested parties break down? What will the Government’s attitude be in that event? Will they keep the pumps going for a period while some other party may be interested in the operation? The important question to which my constituents would like an answer is “When will a decision be known?”.

    It is not difficult to realise the tragedy that hits a family in such an area when relatively well-paid employment is lost. One can imagine a family’s feelings when its income is cut off. In the village of Threemilestone scores of workers who have taken on mortgages in the last 12 or 18 months are now wondering where they stand. They are looking to the Government because they realise that there is nobody else who can give the guidance and assistance required to rescue this mining operation. I look forward with great interest to hearing the Minister’s reply.

  • David Penhaligon – 1986 Speech on the Tin Industry

    Below is the text of the speech made by David Penhaligon, the then Liberal MP for Truro, in the House of Commons on 24 January 1986.

    I wish to launch into what may not be the easiest of tasks. I want to achieve an application of the collective mind of the Department of Trade and Industry to the tin crisis, which affects my county and parts of London, instead of the other difficulty that has received a considerable amount of publicity this week.

    There are two collective problems, one of which caused the other. However, the solution to one of those problems does not necessarily mean that the other will be solved. The question that is constantly being raised in the House —I have raised it several times, and the hon. Member for St. Ives (Mr. Harris) has also raised it several times—is what will the Government do? I can tell the Minister that in Cornwall there is more interest in the Government’s reply to that matter than in the Westland saga.

    The saga begins in London at the London metal exchange. As is well known, the international tin agreement has collapsed and the market was closed towards the end of October 1985. Various rescue bids have been launched. During Question Time yesterday the Prime Minister expressed optimism about the possible conclusion of the latest rescue attempt. I must say that the Prime Minister’s optimism was greater than that expressed by the people who are involved on a day-to-day basis.

    The crisis has been going on for three months, and business is already leaving London. Some people believe that the saga could lead to the end of commodity dealing in London and the reneging on international debts by major financial powers. Whatever the outcome, it is certain that the price of tin will fall, and it is at that stage that Cornwall becomes involved.

    I am one of those in Cornwall who have long taken the view that hard-rock mining is on a pleasant growth pattern and is likely over the next decade, two decades or three decades to make an increasing contribution to the Cornish economy. I and others who share my view do not expect hard-rock mining to return to the levels of production of 140 or 150 years ago, but we have no doubt that hard-rock mining, given Cornwall’s mineral structure, can make a major contribution to the local economy.

    In the 1960s, the average production of tin was about 1,500 tonnes a year. In the 1970s the average was 3,000 tonnes. In 1984, it exceeded 5,000 tonnes for the first time this century. Tin is not the only metal that is mined. Cornwall produced 7,500 .tonnes of zinc, 750 tonnes of copper and 2·5 tonnes of silver in the past mining year. At October 1985 prices, the value of this output was about £50 million to the balance of payments.

    Against this background there were developments in the offing. The two mines in my constituency, Concorde and Cligga, obtained permission to begin production and they are now preparing to launch themselves into it.

    Mr. Robert Hicks (Cornwall, South-East)

    I should like to substantiate the argument that is being advanced by the hon. Gentleman. There are no non-ferrous mines in my constituency, but major prospecting is taking place and boreholes are being sunk at Redmoor near Callington. The ​ determination of the ultimate viability of the project, which it is estimated will produce 300 jobs, will be reflected by the overall price of tin on the world market. The hon. Gentleman is making an important point.

    Mr. Penhaligon

    I thank the hon. Gentleman for making that intervention, which reflects the general picture of growth. Only six months ago, reasonable men would have extrapolated growth. There are about 1,500 on the industry’s payroll, in Cornwall but it is an industry that does a good deal of subcontracting and the actual number employed by the industry, directly and indirectly, is considerably greater than 1,500. The industry claims—this has not been challenged—that it contributes about £23 million a year to the economy. That contribution is made mostly in west Cornwall. It is a worthwhile figure and one that should not be cast aside lightly.

    We are talking about an area that is in the midst of the country’s employment blackspot. In Falmouth, 26·7 per cent. of males of working age are unemployed. The figures for Penzance, Redruth, and Helston are 28·4 per cent., 23·8 per cent. and 25·4 per cent. respectively. A quarter of the male population in the area that is most affected is already unemployed. Thankfully, Truro comes in at fifth place in the unemployment league at about 15 per cent.

    The industry has been aware for some time that the cartel price at which tin was being traded could not be sustained ad infinitum. It was well aware that if the industry was to continue to prosper and grow, it would have to succeed in competing in a free market. It was under no illusions and it recognised that the price of tin in a free market would be less than that at which the commodity had recently been traded on the London market.

    The industry had been making vigorous preparations for the commencement of a free market. Even the most realistic among the mining personnel thought that the day was at least two years further on from today, but preparations were clearly being made made, and most obviously at the three really important mines, the Wheal Jane complex, South Crony and the mine in Penzance which is called Geevor. Geevor is a good illustration of the effort that is being made to enable the mines to modernise themselves and to compete in a free market. Money has already been invested in a new mill at Geevor, which will double its capacity to treat available ore. Half of the ore comes from the old Geevor mine. It is good quality ore, and well worth treating. The other half comes from the old rubbish dumps of years ago. The mine is investing an enormous amount so that it can run into the old Botallack and Lezant mines for further sources of good quality ore to allow the mill to work at full capacity with good material. If the improvement is completed, the mine will be able to compete in the free market.

    We have to deal with the present crisis and the mines are in the worst of all positions. They have lost the higher price that they were enjoying, but have enormous financial commitments. Large sums have already been spent on improving the mines. Unfortunately, although the money has been half spent, the efficiency gain has not been half felt. Indeed, no efficiency gains have been felt so far. If improvement work were terminated today, no improvements in efficiency would have been made.

    The simple question for the Minister is, “Will the Government help?” Will they help towards meeting development costs to improve the efficiency of mines so ​ that they can compete in a free market? If the will exists, there are half a dozen ways in which financial assistance could be given. The county, the miners and their families want to know whether the Government will help. Does the will exist? Will the Government help Cornwall at this tragic time?

    I am not pleading for a lame duck industry. The dominant employer in my constituency is English China Clays, which this year declared a profit of £74 million. I do not know what the Treasury takes from that profit, but I have a feeling that it is considerably more than zero.

    We are merely asking the Government to realise that mining is a high-risk industry and to act as an honest broker in the middle, sometimes assisting mines when they get into difficulties that are not necessarily long-term or terminal.

    On Wednesday next week, about 500 tin miners from my county will be lobbying Parliament. The Cornish anthem, “Shall Trelawny die?” includes the line

    “Here’s twenty thousand Cornish men will know the reason why!”

    There are not 20,000 Cornishmen coming to London on Wednesday, but a lot more than 20,000 in Cornwall want to know whether the Government will assist the Cornish tin industry and, if so, to what extent.

    If no assistance is forthcoming, at least some of the mines will undoubtedly close for all time. A couple may be held on standby for half a decade or so in the expectation that the tin price will rise again. If the Government refuse to assist at this crucial time, the growth that has taken place over the past couple of decades will stop and the production of Britain’s only significant mineral resource will cease. I cannot believe that that would be a logical or rational outcome. I look to the Government for an assurance that they are willing to assist the Cornish tin industry through the tragedy confronting it.