HL Deb 13 March 1967 vol 281 cc1-3

2.35 p.m.


My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.

[The Question was as follows:

To ask Her Majesty's Government how the level of company profits so far reported during 1967 compares with the similar period of 1966; and how they expect company profits for the whole of 1967 to compare with 1966.]


My Lords, there is no official information on company profits available beyond the third quarter of 1966. In the first three quarters of 1966 gross trading profits of companies totalled some £3,472 million—a decline of just under 4 per cent. from the corresponding period of 1965. It is not the practice to forecast future profits.


My Lords, while thanking the noble Lord for that reply, so far as it goes, may I ask him whether he is aware that I tried to draft at least the first part of my Question so that it would be easier for him to answer to-day than my supplementary question was about ten days ago? Will the noble Lord, or his colleagues, try to give more information about this as soon as possible, since there is so much comment in the newspapers at the present time, much of which can he damaging, and it is obviously in the country's interest to know the facts, and to know them as soon as possible?


My Lords, I apologise to the noble Lord that I am unable to give him all the figures for 1966, and obviously he is too soon in regard to 1967. But the noble Lord will he aware that, if we take the motor car industry as a barometer, there is no doubt a good deal less of the pessimism to which the noble Lord has referred than there was at (shall we say?) the end of 1966. In fact, the registration of new motor cars for January of this year was only, I think, some 4 per cent. below the January figure which was an all-time record for the industry. Therefore one should expect to see a recovery of profits during the course of 1967.


My Lords, may we take it from the noble Lord's reply to the supplementary that Her Majesty's Government are in favour of rising profits?


My Lords, the present Government have never been against profits. What we have always been concerned about—as I hope the noble Lord himself is—is the use made of those profits, particularly in the field of reinvestment.


My Lords, is the noble Lord aware that, since the Government take 40 per cent. in corporation tax, 8s. 3d. in the pound in income tax and, in certain cases, another amount in surtax, every single taxpayer is extremely interested in the profit that everybody else makes? Is he aware also that the more profits that companies and others make, the less tax people have to pay? Therefore will the Government do everything they can, in the interests of the people as a whole, to help and encourage companies to make the maximum amount of profits?


My Lords, my noble friend Lord Shackleton says the answer is, "Yes, Sir". I would qualify that with a "No", in the sense that what we wish to see is how these profits arise. Certainly I think the noble Lord would agree with me that what we want is the stabilisation of prices, particularly to assist us in the field of exports; but in practice we should like to see profits at a fair, reasonable level, particularly if they are reinvested in equipment.


My Lords, if there has been a fall in profits in the private sector, and therefore, presumably, the Government will gather less from taxation, would they explain how they propose to finance their vast increases in public expenditure?


All I can do is to refer the noble Lord to the reply which I gave to the noble Lord, Lord Inglewood, some ten days ago and suggest that he should wait until April.

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