US
T
DOCUMENT I S
S E.C
1
THE PROPERTY OP H I S B R I T . U - P I C M A J E S T Y 3
GOVERNMENT)
R E T
C P . (45)
337
1QTH DECEMBER,
COPY NO.
3^
1945,CABINET
B I L L FOR THE N A T I O N A L I S A T I O N
COALMINING
Supplementary
OF THE
INDUSTRY
Memorandum b y
the
Minister
of
Fuel
and
Power
1.
S i n c e rny M e m o r a n d u m o f 8 t h D e c e m b e r ( C P . (1+5) 329)
covering
t h e 5th D e c e m b e r p r i n t of t h e d r a f t C o a l
Industry(NationaIisat i o n ) B i l l was c i r c u l a t e d f u r t h e r d e v e l o p m e n t s h a v e t a k e n p l a c e
of which I should inform t h e Cabinet.
2,
As a r e s u l t of f u r t h e r d i s c u s s i o n s w i t h t h e M i n i n g
A s s o c i a t i o n , a g r e e m e n t h a s now b e e n r e a c h e d on t h e T e r m s o f
Reference ( a t t a c h e d h e r e t o ) under which the T r i b u n a l
(referred
to i n C l a u s e 9 ( 3 ) a n d i n t h e T h i r d S c h e d u l e o f t h e d r a f t
Bill)
w i l l d e t e r m i n e t h e a g g r e g a t e amount of t h e c o m p e n s a t i o n t o b e
made i n r e s p e c t of t h a t p a r t of t h e i n d u s t r y w h i c h i s c o v e r e d
b y t h e d e f i n i t i o n o f " c o a l i n d u s t r y v a l u e " i n C l a u s e 9 (2)
(a).
3.
T h e T e r m s o f R e f e r e n c e a s now a g r e e d a r e , i n s u b s t a n c e ,
t h e same a s w e r e s e e n a n d a p p r o v e d b y t h e M e e t i n g of M i n i s t e r s
h e l d on 6 t h D e c e m b e r , a n d t h e y h a v e b e e n w o r k e d o u t i n c l o s e
consultation with the Treasury throughout.
T h e r e are one or
two a l t e r a t i o n s i n d e t a i l w h i c h t h e M i n i n g A s s o c i a t i o n
asked
f o r , b u t t h e y a r e o n l y m a t t e r s of d r a f t i n g and n o t of p r i n c i p l e .
4.
A g r e e m e n t h a v i n g b e e n r e a c h e d on t h i s m a t t e r i t w i l l n o t
b e n e c e s s a r y t o s e t o u t t h e a c t u a l Terms of R e f e r e n c e i n t h e
B i l l , and t h e r e w i l l be c o r s e o m e n t i a l a l t e r a t i o n s in t h e
w o r d i n g o f C l a u s e 9 (3) a n d t h e T h i r d S c h e d u l e w i l l b e
omitted.
This procedure w i l l enable the A r b i t r a t i o n to proceed
concurrently with the B i l l .
I p r o p o s e to i s s u e t h e Terms of
R e f e r e n c e i n a Command P a p e r a t t h e s a m e t i m e a s t h e B i l l ,
E. 3 .
M i n i s t r y o f
Fuel
10TH DECEMBER,
and
Power,
1945.
S.W.1.
TERMS OP REFERENCE
1,
The T r i b u n a l s h a l l c o n s i s t of two J u d g e s o f t h e
Supreme
C o u r t t o b e a p p o i n t e d b y t h e L o r d C h a n c e l l o r , o n e o f whom
s h a l l b e C h a i r m a n , and. o f a n a c c o u n t a n t t o b e a g r e e d b e t w e e n
t h e p a r t i e s , or i n d e f a u l t of a g r e e m e n t t o be n o m i n a t e d by
t h e P r e s i d e n t of t h e I n s t i t u t e of C h a r t e r e d A c c o u n t a n t s
for
England and Wales.
2.
and
T h e p a r t i e s t o t h e r e f e r e n c e s h a l l b e H.M.
t h e M i n i n g A s s o c i a t i o n of G r e a t B r i t a i n . Government
3.
T h e T r i b u n a l s h a l l d e t e r m i n e t h e g l o b a l sum r e q u i r e d
to
p r o v i d e L a i r compensation, t o the owners of the
assets
d e s c r i b e d i n Annex I h e r e t o f o r t h e t r a n s f e r of t h o s e
assets
to p u b l i c o w n e r s h i p , and f o r bhat purpose s h a l l
ascertain
the amount which t h e a s s e t s might be e x p e c t e d t o r e a l i s e
if
s o l d as one u n i t i n t h e open m a r k e t a s a s s e t s of a g o i n g
c o n c e r n by a w i l l i n g s e l l e r t o a w i l l i n g buyer on t h e
basis
of ( a ) t h e n e t a n n u a l m a i n t a i n a b l e r e v e n u e , t h a t i s t o
say
the net annual revenue which the a s s e t s as a whole might
r e a s o n a b l y be e x p e c t e d t o e a r n i n t h e f u t u r e , i f t h e y were
not t r a n s f e r r e d to p u b l i c o w n e r s h i p , and (b) t h e number of
years purchase to be a p p l i e d
thereto.
U.
(1) T h e T r i b u n a l s h a l l h a v e r e g a r d t o a l l r e l e v a n t .
c i r c u m s t a n c e s , b u t s h a l l n o t make any a l l o w a n c e
either
because t h e a c q u i s i t i o n w i l l be compulsory or b e c a u s e t h e
d i s t r i b u t i o n of c o m p e n s a t i o n among t h e s e v e r a l o w n e r s w i l l
involve expense:
and
(2) T h e T r i b u n a l s h a l l n o t a l l o w i n f a v o u r
of t h e owner
any i n c r e a s e i n v a l u e w h i c h t h e a s s e t s may be e x p e c t e d t o
h a v e a f t e r t r a n s f e r b y r e a s o n of t h e i r b e i n g i n t h e h a n d s o f
one owner and of t h a t owner b e i n g , i n e f f e c t , t h e
State.
5.
In order to f a c i l i t a t e t h i s reference the p a r t i e s hereto
h a v e a g r e e d t h a t t h e f i g u r e s of t o n n a g e d i s p o s a b l e ,
profit
p e r t o n and r e v e n u e f o r p a s t y e a r s a r e a s shown i n Annex I I
hereto.
6.
C a s e s s h a l l be e x c h a n g e d on o r b e f o r e t h e 30th d a y o f
M a r c h , 1 9lx6.
R e p l i e s s h a l l be exchanged not l a t e r
than
tlx d a y s a f t e r t h e e x c h a n g e o f c a s e s .
C a s e s and R e p l i e s
s h a l l b e l o d g e d w i t h t h e T r i b u n a l on t h e same d a y s a s t h e y
are exchanged.
7.
The
parties
may
appear
before
the
tribunal
8.
S u b j e c t t o p a r a g r a p h s 6 and 7 of t h e s e
T r i b u n a l s h a l l r e g u l a t e , i t s own p r o c e d u r e .
by
Terms
Counsel.
the
ANNEX
I
The a s s e t s c o n c e r n e d a r e t h e a s s e t s o f t h e C o a l I n d u s t r y
( a s defined below) but not i n c l u d i n g coal in stock or i n
t r a n s i t , s t o c k s of t i m b e r ,
stores, materials, spare
plant
or p a r t s , l i q u i d a s s e t s , f r e e h o l d m i n e r a l s o t h e r
than
c o a l , r i g h t s g r a n t e d by the Coal Commission i n l i e u of
l u m p sum c o m p e n s a t i o n t o g e t o r l e a d c o a l a t a p e p p e r c o r n
r e n t or r i g h t s i n r e s p e c t of s h o r t w o r k i n g s :
and for
this
purpose
( a ) T h e C o a l I n d u s t r y i n c l u d e s t h o s e
activities
only which are comprised in that
industry
f o r t h e p u r p o s e of t h e d i s t r i c t w a g e s
a s c e r t a i n m e n t s t h a t i s to say the
ascertainments
o f t h e r e s u l t s of t h e i n d u s t r y i n a c c o r d a n c e
w i t h a g r e e m e n t s between c o l l i e r y owners and
mine workers f o r r e g u l a t i n g wages.
( b ) An
'(c)
a s s e t i s an. a s s e t o f t h e G o a l I n d u s t r y i n s o
a s i t i s so t r e a t e d f o r t h e p u r p o s e o f t h e
d i s t r i c t wages a s c e r t a i n m e n t s , but an a s s e t
b e l o n g i n g to an excluded a c t i v i t y
brought
i n t o c o m p u t a t i o n on such a s c e r t a i n m e n t s a t a
f a i r transfer p r i c e or similar charge is not
a n a s s e t of t h e C o a l I n d u s t r y .
C a s e s of d o u b t s h a l l be t e s t e d
the a c t u a l a s c e r t a i n m e n t s of
w o r k i n g f o r J u n e 1939 o r f o r
f i r s t i n c l u d e d J u n e 1 939.
by reference
to
tho r e s u l t s of
the period which
far
ANNEX
Tonnage
Commercially
Disposable
million tons
II
T.8,
credit balance
per ton
.
s.
d.
(to nearest
farthing)
1922
1923
228
253
2
192k
2kk
1
1925
1926
1927
1928
1929
193 0
1931
1932
1933
1934
1935
193 6
222
81
Notes:
11.25
27.38
2
lk.25
3-1
1
3i
5t D r .
11 D r .
219
1937
1938
1939(first
9
months )
2^
l l f
231
-
T.S*
gredit balance
£ million
'
3.38
5.15
' 5.44 D r .
9.99 Dr..
4.65
239
2 23
203
192
192
205
2 06
212
224
210
1
1
2l
4
3.05
1.6k
2.30
k.40
5.42
10.17
13.77
I k . 09
160
1
i\\
11.02
hk
4i
3l
2
3
5
6-t
l i t
k.ll
'
(l)
The t o n n a g e i s t o n n a g e c o m m e r c i a l l y
disposable, which i s broadly
speaking the sales
tonnage.
( 2 )
T h e a c t u a l T.S. f i g u r e s a r e b a s e d o n
returns covering only approximately
97a o f t h e i n d u s t r y .
The f i g u r e s
shown above a r e t h e T . S .
figures
s c a l e d u p t o 100'A.
( 3 )
The above f i g u r e s a r e s u b j e c t to
certain
adjustments to arrive at net annual
revenue i n c l u d i n g an adjustment in r e s p e c t
of r e m u n e r a t i o n of w o r k i n g c a p i t a l .