HC Deb 17 July 1986 vol 101 cc1161-2
7. Mr. Leigh

asked the Chancellor of the Exchequer what representations he has received seeking additions to his proposals to extend direct ownership of equity shares.

Mr. Norman Lamont

Some modifications to the personal equity plan have been suggested, but most have warmly welcomed the scheme as it stands.

Mr. Leigh

Does my right hon. Friend agree that, following the achievement of a property owning democracy, our central aim as Conservatives should be to achieve a share-owning society in which the majority, not just a small minority, of British people are given a real stake in the ownership of British industry? In that light, has he reached a decision on the limits which will apply to investments in unit trusts, investment trusts and the personal equity plan, and will he be as generous as possible?

Mr. Lamont

My hon. Friend should know that I am answering a written question today whereby the limit on investment in authorised unit trusts and approved investment trust companies under the scheme will be £420 a year or 25 per cent. of the investor's annual—

Mr. Campbell-Savours

Order. That is a written answer.

Mr. Speaker

Yes. Unusual. Mr. Nellist.

Mr. Nellist

As for the question from the hon. Member for Gainsborough and Horncastle (Mr. Leigh) regarding a share-owning democracy, is the Minister aware that 467 shareholders own more than two-thirds of the shares of Cable and Wireless? Any other investigation of privatisation in the past seven years under this Tory Government would show that rather than creating a share owning democracy — the public as a whole had previously owned these industries — a smaller and smaller number of larger, private shareholders are raking in the benefits of privatisation.

Mr. Lamont

The purpose of the personal equity plan is to increase direct ownership of shares by individuals and to reduce the proportion owned by institutions as such. If that is what the hon. Gentleman is criticising, I very much welcome his conversion to supporting the scheme. The Government very much want to see the widest possible ownership of shares. That is why we have introduced this special relief,, which will be of particular benefit to small shareholders and people on modest incomes.

Mr. Holt

Does my right hon. Friend agree that most people would like to go into share owning but at the moment are frightened by the tactics of the Labour Opposition who suggest that they will steal back British Telecom shares at a price below their market value?

Mr. Lamont

We have all noticed that the Labour party has put forward a proposal for re-nationalisation of private companies, but it does not seem to have the guts to give it its true name. We all know that it simply amounts to the confiscation of people's shares.

Mr. Donald Stewart

Does the Minister expect the scheme to have any credibility with investors, let alone new investors, when, if they wish to dispose of their shares in a falling market, they will lose the benefits of the Exchequer arrangements? How does that have any credibility?

Mr. Lamont

I am not sure what point the right hon. Gentleman is making when he refers to a falling market. Obviously if there are no profits to be made there will be no tax relief. This scheme gives small investors the opportunity to build up, over a period of time, significant profits on which there will be tax relief. The relief given on dividends is especially important to small investors.

Mr. Sumberg

Is my right hon. Friend aware that a recent stock exchange survey has shown that share ownership has doubled under this Government? One in seven adults now have a direct stake in British industry. Is this not a good base on which the Government can build?

Mr. Lamont

I believe that it is a thoroughly desirable development. There are different estimates of the proportion of the population that own shares, but it does seem to be universally agreed, even if there are different estimates of what the position is today, that it has doubled from whatever the situation was before.

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