§ 62. Mr. Blackasked the Chancellor of the Exchequer whether he is satisfied with the response by companies to his request that dividends should not be increased; and what further action he proposes to take.
§ Mr. GaitskellI am informed that, according to a recent study, although gross profits increased by 9 per cent. and the proportion of companies making dividend increases has grown, the total distribution by way of ordinary dividends, which was, incidentally, just over 10 per cent. of gross profits, went up by only about 3½ per cent. in 1950, as compared with 1949. This suggests that over the year as a whole, a substantial measure of restraint was still being exercised. But there has undoubtedly been a tendency in the last few weeks to increase dividends, and I am keeping a close watch on the situation.
§ Mr. BlackWith a view to encouraging companies not to increase their dividends, is the Chancellor willing to make it clear that, if any statutory limitation is imposed, it will not operate in such a way as to be to the disadvantage of those companies which have voluntarily kept their dividends level?
§ Mr. GaitskellThat is a hypothetical question.