Once labelled “King Coal”, Richard Budge, who has died aged 69 of prostate cancer, was the determinedly optimistic businessman who, in 1994, persuaded the Conservative government to sell the bulk of the British coalmining industry to his eponymous company, RJB Mining. But after some initial success, he found himself ejected from his faltering enterprise and his subsequent attempts to use untried technology to make a success of a single pit led to repeated disappointment and eventual bankruptcy.
A larger than life character, always with a new plan up his sleeve, Budge seemed to have more in common with the dealmaking building industry from which he sprang than with the weighty calculation of the nationalised coal industry, to which he came as a contractor. But he was difficult to categorise; he showed early promise as an artist, raced classic sports cars successfully and demonstrated genuine warmth for the miners he employed.
Budge was born in Boston, Lincolnshire, to Frederick, a housebuilder, and his wife, Charlotte. At Boston grammar school he discovered a profitable sideline in painting landscapes and a liking for the surrealists. But a fine arts course at Manchester University lasted only a few months before his commercial ambitions won out, and he joined his elder brother Tony’s new contracting firm, AF Budge, in 1966. He started as a trainee, learning from the ground up before becoming a supervisor, then a site manager and contracts manager, working on roadbuilding projects. He married his teenage sweetheart, Rosalind White, in 1968.
In 1974 he became the managing director of Budge Mining, the group’s opencast coalmining arm, set up originally to make use of its construction machinery in winter. Sixteen years later the mining operation was producing a third of British Coal’s opencast output and Budge raised £102m to buy it out from his brother. He relaunched in 1993 with a stockmarket float and a new name, RJB Mining, after his own initials. A year later he successfully bid for three of the five parts of nationalised British Coal offered for sale by the government – the complete English industry, which comprised 17 pits plus land and opencast interests.
It was a remarkable success for a relatively small-time businessman. Budge had been active in pressuring the government for a sale, arguing to Michael Heseltine at the Department of Trade and Industry that additional markets could be found for the industry’s huge stockpiles. The government, weary of constant battles over pit closures, seized the opportunity to give private industry its chance.
RJB’s £815m bid was £100m more than its nearest rival. But Budge faced questions both about whether he had overborrowed and paid too much or alternatively whether the government had let him have the industry on the cheap. His personal suitability was questioned as it emerged that his brother’s firm had gone into receivership owing £65m 10 months after Richard had resigned in 1992. The receivers found it had also invested in yachts, racehorses and armaments. Richard paid back £325,000 for loans not properly recorded. RJB Mining had paid private Budge companies for air services and hospitality shooting days. Investment managers complained about his proposed £400,000-a-year salary and it was cut to £225,000.
Typically he shrugged it off. Initially things went well. Profits were £285m in the first year and the money borrowed for the purchase was paid off in 18 months. Budge built a relationship with the miners and reprieved three pits on the government closure list. A colleague commented that he was never so happy as underground talking to the men. A union representative described him as “having coal running through his veins”. He supported coalfield charities including the Grimethorpe Colliery Band and was a concerned chairman of the Coal Industry Social Welfare Organisation.
But the realities of an overstocked industry producing at above-world prices and growing environmental regulation soon made themselves felt. Demand fell. Privatisation had been sweetened by an agreement with electricity generators to take more coal, but now the government was unwilling to provide further assistance. In 2001 Budge was sacked as chief executive of RJB Mining with a £1m payoff, apparently after refusing to take sufficiently drastic action to stem losses. The company was renamed UK Coal.
But Budge continued his love affair with coal and his belief in potential profits by purchasing and reopening Hatfield colliery near Doncaster, with the intention of building the UK’s first clean coal power station next door using unproved technology. He failed to get government funding and the business collapsed in 2003, only to be revived by the resourceful Budge in 2007 when he secured ¤183m (£154m) of funding from the EU and brought in Russia’s second largest coalmining company as a partner. This time the plan was for carbon capture – capturing power station emissions and burying them in cavities under the North Sea. But with growing government doubts about the technology, the business went into administration in 2010, and in 2013 Budge was declared bankrupt.
UK Coal continued until a restructuring in 2014. Its last deep mine, Kellingley, at Beal in North Yorkshire, closed in December 2015.
Budge’s last years were clouded by illness after he was diagnosed with prostate cancer in 2007, and by the fallout from the bankruptcy, which caused him to resign a series of official and trustee positions. But in April this year he was elected an honorary liveryman of the Worshipful Company of Fuellers for his “lifetime contribution to the coal industry”.
He is survived by Rosalind and their two sons, Kurt and Grant.
• Richard John Budge, businessman, born 19 April 1947; died 18 July 2016
