HC Deb 13 February 1962 vol 653 cc1097-9
6 Mr. Jay

asked the Chancellor of the Exchequer what has been the percentage rise in wages, salaries and dividends, respectively, over the past ten years.

Mr. Selwyn Lloyd

Between 1950 and 1960 it is estimated that total wages rose by 87 per cent., total salaries by 119 per cent. and gross ordinary dividends by 145 per cent. Total company profits rose by 70 per cent. in this period.

Provisional figures for the first nine months of 1961 suggest that wages and salaries in that period were altogether about 8.1 per cent. higher than in the corresponding period of 1960, while the level of gross ordinary dividends rose by about 12 per cent. Company profits fell by 7 per cent. in this period.

Mr. Jay

In view of the figures for the last ten years, which the Chancellor has given, is it not really absurd to suggest that rising wages have been the main cause of inflation? Is it not even more indefensible to try to hold down wage rises to 2½ per cent. while not effectively imposing any such restraint on a great many salaries and incomes?

Mr. Lloyd

I think that the right hon. Gentleman has completely disregarded one very important fact, that between 1950 and 1960 £10,000 million of profits were ploughed back into industry and in addition £1,500 million of new capital was raised. In fact, gross dividends went up by £600 million. If that is considered in relation to the £10,000 million ploughed back and the £1,500 million of new capital raised, I think one gets the rise in dividends in much better proportion.

Mr. Jay

It is just because I realise these facts that I put the Question in terms of dividends and not of profits.

Mr. Lloyd

But surely dividends are relevant. Is the right hon. Gentleman suggesting that there should be savings without any return on the savings at all when these are company savings?

Mr. Jay

If I am asked the question, I would ask the right hon. and learned Gentleman if he is not aware that obviously the fairest comparison is between wages, salaries and dividends.

Mr. Lloyd

Would not the right hon. Gentleman agree that the size of the labour force comes into account? The labour force has gone up by 8 per cent. and it is a relevant factor. The amount of capital on which dividends are paid is also a relevant factor.

Mr. Ridsdale

Is my right hon. and learned Friend aware that in 1960 wages and salaries totalled £13,690 million and dividends on ordinary shares only £986 million?

Mr. Lloyd

Gross dividends were about 7 per cent. of wages and salaries.

Mr. Lee

Is the right hon. and learned Gentleman complaining that there are too many workers now?

Mr. Lloyd

I was really complaining that hon. Members opposite, who are supposed to encourage savings and who want profits ploughed back, do not seem to be prepared to agree that these profits deserve some remuneration.