The North’s coal and steel industries could have been saved by state aid - claim

MP Yvette Cooper, pictured at Kellingley Colliery.....SH100120360a..31st January 2015 ..Picture by Simon Hulme
MP Yvette Cooper, pictured at Kellingley Colliery.....SH100120360a..31st January 2015 ..Picture by Simon Hulme
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THE BRITISH COAL and steel industries could have had a brighter future if the Government had gone to Brussels to ask permission to deliver cash handouts, it’s been claimed.

EU sanctioned state aid would have helped Britain’s last deep pit, Kellingley Colliery, in North Yorkshire, stay open for longer, and rescue the SSI steel plant in Redcar, Labour politicians in Westminster and Europe have said.

As 450 miners complete their last shifts at Kellingley this week, MP Yvette Cooper led an emotional debate in the House of Commons on the demise of a coal mine that once employed 2000 people.

She told Energy Minister Andrea Leadsom that if the Governent had applied to the EU to grant state aid, the pit would have been open until 2018 and offered workers three more years of employment.

Ms Cooper, whose grandfather was a miner, said: “We campaigned for the EU state aid that could have opened new faces and accessed new and rich reserves, and yet the Government deliberately dragged their feet, pushed costs up, and let us down.”

Campaigners argued back in 2014 that state aid would maintain access to significant coal reserves and ensure that the employees continued in work.

Failing to apply for state aid would also jeopardise the entire country’s energy security, it was said by the TUC.

However Ms Leadsom said the £338m state aid request from UK Coal for various mines did not pass the ‘value for money hurdle’ to the taxpayer, it would have been a difficult route and also have tied the mine’s owner to a fixed closure date.

She said any suggestion the Government ‘prevented’ UK Coal from applying for state aid was untrue.

“The state aid route was judged to be longer and riskier, which left a commercial solution as the best option.

“Structuring the solution in a commercial manner also had the benefit of not tying the company to a fixed closure date—something that a state aid solution would have done.

“Instead it would give the company flexibility and time to seek additional investment to extend the life of the mines,” she said.

Ms Cooper said: “The fixed date that the Minister mentions under the EU state aid rules would have been 2018, which is in three years’ time. That was not a reason not to go down the EU state aid route.”

Asking Brussels permission to grant British state aid was also at the centre of the row over the closure of SSI steelworks. The Government argued the rules were too narrow for them to give the company a loan, and instead offered an £80m fund to help people retrain.

However North East Labour MEP Jude Kirton-Darling said a letter she has from the EU Commission confirms there were ways to intervene, notably in research. She highlighted a case from 2010 where the European Commission let Germany give €19.1m in state aid for an energy-saving steel production project.