§ Mr. Leeasked the Chancellor of the Exchequer what percentage of investment capital for industry is currently raised by Stock Exchange share floatation; what percentage is raised from bank loans; what percentage is raised from internal sources; and what percentage is raised from Government assistance.
§ Mr. Denzil DaviesThe latest available estimates for the sources of industrial and commercial companies' funds are as follows:
1974 Per cent. 1975 1st half Share of total sources of funds* Internal funds† 60.4 63.8 Investment and other government grants 2.3 2.7 Other capital transfers 0.6 0.8 Bank borrowing 34.8 22.2 Issues of ordinary and preference share capital by listed companies 0.5 6.1 Other funds 1.4 4.4 Total 100.0 100.0 Sources:
"Structure of Company Financing" (article in September 1975 issue of Economic Trends) and Financial Statistics, October 1975, Table 81.
* As defined in the article in Economic Trends.
† Gross income less payments of tax, dividends and interest, and transfers to public corporations and charities. Capital transfers received by companies (also included in "internal funds" in the article) are shown separately.
The figures are based on estimates of flows of funds to companies and not on levels of outstanding liabilities. It is not possible to separate funds which will be used to finance fixed investment from those used for other purposes; in particular it is likely that part of internal funds and of bank borrowing is used to finance working capital.