§ 26. Mr. Farrasked the President of the Board of Trade what study he has made of the causes of the sharp fall in the numbers of new private companies registered; what conclusions he has reached; and what steps he is taking to correct this trend.
§ Mr. DarlingA wide variety of factors appears to have contributed to the decline in recent years in the number of new private companies registered. I do not consider it necessary to take steps to reverse this trend. The Companies Act, 1967, increased fees for the registration of companies. One of the purposes was to check their proliferation.
§ Mr. FarrAs new registrations are steadily declining in number and bankruptcies are steadily increasing in number, is it not a fair indication that it is probably the Socialist method of conducting the affairs of this country which is the prime cause of the situation?
§ Mr. DarlingThe hon. Member's figures are quite inaccurate to support that kind of argument. Since 1965, 60,000 new private companies have been registered. The figures are declining now because the new Companies Act abolished the status of the exempt private company.
§ Mr. BarnettWould it not be totally wrong to encourage small companies near to bankruptcy to register? Would my right hon. Friend confirm that much of the decline is due to the totally false picture given by hon. Members opposite about tax advantages to businessmen in close companies who plough back their profits?
§ Mr. DarlingI agree entirely.