Profit-Sharing and Co-partnership Schemes

HC Deb 12 July 1955 vol 543 cc1731-2

32. Mr. Holt

asked the Chancellor of the Exchequer if he will set up a Departmental inquiry to see in what way present taxation law might be altered to facilitate the growth of schemes of employee shareholding in industry.

40. Mr. Gower

asked the Chancellor of the Exchequer if he will institute an inquiry into the problems of companies and firms which institute profit-sharing and co-partnership schemes and, in particular, into the fiscal measures necessary to facilitate the growth of such schemes.

Mr. R. A. Butler

I have kept myself closely informed as to the tax position of such schemes, and I do not think a special inquiry is warranted.

Mr. Holt

Can the Chancellor assure us that he is continuing to examine the position where taxation law raises barriers to the development of employee-shareholding in industry? Will he, at some time in the future, make a statement of the Government's policy in this respect?

Mr. Butler

The fiscal difficulties are very small, upon examination. The real difficulty is to frame schemes which fall in with the law. That is why I stated in a previous speech that the services of the Inland Revenue would be available to firms wishing to implement schemes of one or other of the types mentioned by the hon. Member. It is in that way that some of the complexities are avoided at an early stage. If any particular fiscal difficulties come to my notice I shall always be glad to make a statement or, at the right time, to do something about them.

Mr. Gower

Is it not the fact that the fiscal policies of successive Governments for many years have been admirably designed to encourage the introduction of pension schemes, but have not been designed to encourage co-partnership? Can my right hon. Friend also examine that matter?

Mr. Butler

Yes, Sir. The reason why I said that an inquiry was not necessary was that we have in fact made our own inquiry, and are pretty well aware of all the details of this problem. If at any time I can help any hon. Member, however, I shall be only too glad to do so.

Mr. Woodburn

Is the Chancellor aware that the Prime Minister announced, in a broadcast, that the Government had some new policy about co-partnership and profit sharing? Has not the Chancellor been consulted? Was not a businesslike arrangement made before such a broadcast was made?

Mr. Butler

Everything the Prime Minister says, so far as I can say, is the quintessence of wisdom. In this case he was representing the united policy of his colleagues in this matter, and he was also interpreting the general sense of the country, as is evident from the schemes which have recently been published.