HC Deb 16 April 1946 vol 421 cc2522-3
50. Mr. Diamond

asked the Chancellor of the Exchequer whether his attention has been drawn to the statement in the Second Report from the Committee of Public Accounts that Messrs. Simmonds Aerooessories, Limited, and Messrs. Simmonds Aerocessories (Western), Limited, made an average profit for the years 1939, 1940 and 1941 of more than 70 per cent. on the capital employed; and what steps he proposes to take in the matter.

Mr. Dalton

Yes, Sir, and I am now considering what steps, if any, should he taken.

Sir J. Mellor

Will the Chancellor of the Exchequer agree that the Treasury ultimately get most of these profits through the Excess Profits Tax?

Mr. Dalton

The report of the Public Accounts Committee showed that these profits were far in excess of any rate considered to be appropriate in Government contracts. At the same time, there was no contractual right to regulate profits secured in this case by the Ministry of Aircraft Production.

Sir W. Darlinģ

Why not?

Mr. Dalton

I was not Minister of Aircraft Production. Any adjustment other than a voluntary refund by the firms concerned, which the Treasury will be very glad to accept, will require retrospective legislation.

Mr. Gallacher

Robbing the community.

Mr. Oliver Stanley

I do not think the Chancellor quite answered the question. Could he tell us how much of this profit came back to the Treasury through E.P.T.?

Mr. Dalton

The answer is that E.P.T. at this time was at the rate of 100 per cent.

Mr. Stanley

Is it a fact, then, that all this profit came back to the taxpayer?

Mr. Dalton

Not necessarily at all, but I think the right hon. Gentleman knows the law well enough not to make it necessary for me to answer at greater length.

Mr. Mikardo

Is it not a fact that in a previous similar case, the Committee of Public Accounts stated as a reasoned view that taxation does not compensate for this form of profiteering?

Sir W. Wakefield

Is not the Chancellor aware that in subsequent years this firm suffered very heavy losses?

Mr. Dalton

That is not the Question on the Order Paper. I have endeavoured to answer the Question, I hope. It is difficult to pursue the matter at greater length now.

Mr. Cobb

May I ask the Chancellor where his costing officers were?