§ 21. Mr. Stevensasked the Chancellor of the Exchequer if he will make a statement indicating the response he has had to his appeal for dividend restraint.
§ Mr. Selwyn LloydAs I said in my speech to the House on 7th November, I believe my appeal for restraint is being regarded.
§ Mr. Emrys HughesIs the right hon. and learned Gentleman aware that one company presided over by an hon. Member opposite has responded by increasing its dividend to 20 per cent.? Is he aware that it is a brickmaking company, and that if he wants further information he can get it from the hon. Member for Ayr (Sir T. Moore), who is the chairman?
§ Mr. LloydI do not think it is proper or possible for me to deal with particular cases. I am dealing with the generality.
Mr. H. WilsonWhile the Chancellor is dealing with the generality, will he bear in mind that, despite the fact that many profits have been falling, dividends have this year increased a great deal more than wages have done.
§ Mr. LloydThat is a different question. I should be very willing to give the right hon. Gentleman the statistics at my disposal, but I am dealing with the situation since 25th July.
§ Mr. NabarroThe Co-op dividend has gone down, not up.
§ 22. Mr. Stevensasked the Chancellor of the Exchequer to what extent it is his intention, in connection with dividend restraint, that a company should not effectively increase its dividend distribution despite an increase in annual profits.
§ Mr. Selwyn LloydThe fact that annual profits may have increased in certain cases does not affect my view that a further general increase in dividends is unjustified. Special considerations apply in the case of trading companies liable to Surtax directions, under Section 245 of the Income Tax Act, 1952.
§ Mr. StevensWould not my right hon. and learned Friend agree that if the dividend of a company is increased proportionately with the increase in profits, the company's board clearly cannot be said to be exercising dividend restraint? Even though it may be that the dividend policy of certain trading companies is liable to Surtax direction under Section 245, their decisions may be controlled by a small number of persons. Surely my right hon. and learned Friend's appeal for restraint should apply to private incomes of that kind as well as to incomes dissipated very widely through the dividends of public companies?
§ Mr. LloydWith regard to the first part of my hon. Friend's supplementary question, one must deal with the general and not the particular. With regard to the second part, I could not be expected to encourage people to avoid Surtax by putting profits to reserve beyond the needs of a company.