§ Mr. Biffenasked the Chancellor of the Exchequer what is the estimated percentage increase in company gross trading profits during the third quarter of 1971 compared with the corresponding period of 1970; and how this compares with the percentage increase in salaries, wage rates and earnings.
§ Mr. HigginsNo estimate of the percentage increase in salaries is available. Estimates for the remaining items are as follows:
Third quarter 1970 Third quarter 1971 Percentage increase Gross trading profits of companies* 1,201 1,495† 24.5 Index of wage rates (31st January, 1956=100)‡ Weekly 198.3 224.0 130.0 Hourly 219.5 248.5 13.2 Index of average earnings (January, 1970=100) 108.7 120.9 11.2 Notes: All estimates are not seasonally adjusted.
*As defined in the national accounts—before providing for depreciation and stock appreciation; estimates are provisional and subject to revisions.
† The estimate for 1971 is significantly affected by the way in which S.E.T. is recorded (i.e. on a cash flow basis). Payments were halved in July, 1971, but the refund sector subsequently received amounts which had been previously paid at the full rate. As this reduced the forced loan element the effect was to increase the figure recorded as gross trading profits in the third quarter of 1971 by some £100 million.
†Average of end-July, August and September.