HC Deb 23 May 1968 vol 765 cc130-2W
Mr. Bruce-Gardyne

asked the Chancellor of the Exchequer if he will define the distinction which he draws between near-contractual obligations, and other forecasts, respectively, in assessing whether or not to approve increases in distributions by public companies.

Mr. Diamond

I would refer the hon. Member to my reply to him of 20th May. —[Vol. 765. c.43.]

Mr. Bruce-Gardyne

asked the Chancellor of the Exchequer why he has decided that the 3.66 per cent. increase in the aggregate value of distributions by United Drapery Limited is in accord with the Government's proposed ceiling on dividend increases.

Mr. Diamond

The company issued ordinary shares in respect of an acquisition, thereby increasing the issued capital qualifying for dividend.

Mr. Bruce-Gardyne

asked the Chancellor of the Exchequer whether it is in conformity with the Government's proposed ceiling on dividend increases for a company, which is required to limit the increase in its distributions to 3½ per cent., to subscribe the difference between such limited distributions and the distributions it had otherwise intended to make to the funds of the political party of its choice.

Mr. Diamond

The voluntary scheme of dividend restraint is primarily concerned with distributions by companies in respect of equity share capital.

Mr. Bruce-Gardyne

asked the Chancellor of the Exchequer whether the 12.5 per cent. increase in distributions by James Robertson and Sons Limited, the 16.6 per cent. increase in distributions by Stuttaford and Company Limited, the 3.636 per cent. increase by Crosby Spring Interiors Limited, the 42.8 per cent. increase by East Kilbride Dairy Farmers Limited, and the 18.5 per cent. increase by Irish Oil and Cake Mills Limited conform with the Government's proposed dividend ceiling; and if he will publish the actuarial calculations, in each case, on which his conclusions are based; and if he will give an undertaking not to take steps to prevent such distributions.

Mr. Diamond

James Robertson and Sons Limited is a close company. Neither Stuttaford and Company Limited nor Irish Oil and Cake Mills Limited are incorporated in the United Kingdom. The Treasury are making inquiries of Crosby Spring Interiors Limited. East Kilbride Dairy Farmers Limited consulted the Treasury, and agreed not to exceed the total dividends paid two years previously.

Mr. Bruce-Gardyne

asked the Chancellor of the Exchequer if he will publish in the OFFICIAL REPORT the actuarial calculations which led him to decide that the 50 per cent. increase in distributions by Northern Petrol and Bulk Freighters Limited was in conformity with the Government's proposed ceiling on dividend increases.

Mr. Diamond

The company propose to distribute no more to shareholders than three years ago.

Mr. Bruce-Gardyne

asked the Chancellor of the Exchequer if he has now decided whether the increase in total distributions from reduced profits by Mark Lang Limited, and the 38 per cent. increase in total distributions by Clover, Croft and Slater Limited are in conformity with the Government's proposed ceiling on dividend distributions; and if he will publish, for each, the actuarial calculations on which his decision was based.

Mr. Diamond

Mark Lang Limited consulted the Treasury, and agreed to limit the increase in dividend to 3½ per cent. above the previous year. I understand that Clover, Croft and Slater Limited have recommended a dividend not higher than two years ago, but we are confirming the position with the company.

Mr. Bruce-Gardyne

asked the Chancellor of the Exchequer what is the maximum number of years which a public company can cite backwards in justifica- tion of a dividend distribution to the satisfaction of the Treasury.

Mr. Diamond

This is a matter for consideration in the light of the full circumstances in each individual case.

Mr. Bruce-Gardyne

asked the Chancellor of the Exchequer if he will publish in the OFFICIAL REPORT the mathematical calculation which led him to conclude that the 1932 per cent. distribution per share by Gill and Duffus Limited in 1967 exceeded that company's 1966 distribution of 18.66 per cent. per share by precisely 35 per cent., and not by 3.535 per cent.

Mr. Diamond

The company distributed 18⅔ per cent. in 1966; the calculation is therefore: 18⅔%+(3½% of 18⅔%)=19.32%.

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