HC Deb 02 May 1984 vol 59 c344
16. Mr. Hanley

asked the Secretary of State for Trade and Industry if he will make a statement on company profits and liquidity in 1983.

Mr. Fletcher

The gross trading profits of non-North sea industrial and commercial companies, after deducting stock appreciation, are estimated to have risen by nearly one quarter between the years 1982 and 1983. It is provisionally estimated that the real rate of return on capital has increased from 4.6 per cent. in 1982 to 6.2 per cent. in 1983, the highest since 1978.

The liquidity of the large companies in the Department's quarterly survey increased appreciably during 1983, although there was some reduction in the fourth quarter after the sharp rise in the third. It is estimated that this still left it higher than at any other time since the end of 1978.

Mr. Hanley

Does my hon. Friend agree that the recent Budget will increase post-tax profits, that that will increase company liquidity and that profits without liquidity are meaningless?

Mr. Fletcher

Yes, Sir.