HC Deb 23 May 1963 vol 678 cc608-9
3. Mr. Ridley

asked the Chancellor of the Exchequer by how much, as a percentage, in real terms wages and salaries on the one hand and dividends on the other have risen between 1938 and the present day.

Mr. Boyd-Carpenter

Between 1938 and 1962 total wages and salaries rose by 443 per cent. and total gross ordinary dividends by 226 per cent. The latter figure has been adjusted to exclude dividends paid in 1938 by companies subsequently nationalised. The corresponding increases, in real terms, as measured by the consumers' price index, were 79 per cent. for wages and salaries and 8 per cent. for ordinary dividends.

Mr. Ridley

In view of the fact that those are very striking figures, will my right hon. Friend give them the maximum publicity? Will he further bear in mind, when considering the rather unfair distinction in the tax law between earned and unearned income, what considerable disadvantages drawers of dividends start with?

Mr. Boyd-Carpenter

The latter part of my hon. Friend's supplementary question raises rather wider issues than I can deal with at Question Time, although we may have an opportunity for a discussion of this sort of thing later on today. On the first part of the question, it is important that all the facts of the matter should be known, and my hon. Friend's initiative in putting down a Question has been very helpful.

Mr. Callaghan

Since it is important that all the facts ought to be known, can we be given some of the facts about the amount of capital distributions, bonus shares and various other devices which have been employed for the last 10 years with the object of avoiding the payment of Income Tax by companies, and also to disguise the real increase in dividends? Are not these figures so striking as to cause very grave doubts about their validity? Is not the Chief Secretary really a little frightened to pretend that the increases are in this proportion, when everybody knows that the increases that have gone to shareholders are far greater than those figures show?

Mr. Boyd-Carpenter

The figures I have given are the official figures, and they are true. I am surprised that the hon. Gentleman, apparently, likes them so little that he tries to denigrate them. If he would be good enough to put down a Question, I will endeavour to give him answers on all the facts available. Whether he will like them, I do not know.