Call for coal industry tax break as 80 jobs at risk

The Chancellor was speaking on the Andrew Marr show. Picture: APThe Chancellor was speaking on the Andrew Marr show. Picture: AP
The Chancellor was speaking on the Andrew Marr show. Picture: AP
THE UK’s largest coal company has made an impassioned plea for a tax break to help the industry as it announced that around 80 Scottish mining jobs are at risk from the falling coal price.

Hargreaves Services informed employees of the risk of job losses as it called on the UK Government to extend an exemption from the Carbon Price Support levy to opencast mines on brownfield sites.

Currently the exemption only applies to the mining of coal slurry and was introduced to encourage the industry to keep extracting the mineral while cleaning up the environment. Hargreaves believes that the extending the exemption to opencast sites would minimise job losses as well as make it economically viable for the company to restore the 35 square kilometres of opencast sites that scar the landscape across East Ayrshire, South Lanarkshire and Fife.

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The plea is being made ahead of George Osborne’s budget next week. Carbon Price Support is a duty imposed on coal used for electricity production. It currently stands at £21 per tonne of coal.

Hargreaves argues that an exemption would make a significant difference when it is considered that the price of coal has fallen to £40 per tonne.

The company believes that an exemption would provide an elegant solution to the challenges facing the company, because it would make it economical to employ its workers to restore the landscape ruined by past opencast developments as well as extract coal from brown field sites.

According to Hargreaves, 1,000 Scottish mining jobs would be protected by the move. The £200 million cost of the exemption would be more than made up for by the £250 million boost to the economy that would result from safe-guarding jobs over the next five years.

Iain Cockburn, Group Finance Director of Hargreaves Services said: “We have worked hard to establish a mining operation in Scotland and it is very regrettable that we are faced with the prospect of having to reduce the size of the skilled workforce that has been built up in the last 18 months. We recognise it is a stressful time for the workforce and their families and we can only assure them that we are working as hard as possible to secure the CPS Exemption to protect their job prospects for the next five years as the industry sets about restoring the abandoned sites.”

Last night the Treasury declined to comment ahead of the budget. But a Scottish Government spokesman said the UK Government should give “urgent consideration” to Hargreaves’ proposal saying it could save or create jobs.