HC Deb 24 October 1978 vol 955 cc845-7W
Mr. Lawson

asked the Secretary of State for Industry whether he will publish data on the basis used in Table I of the article "Companies' Rate of Return

Mr. Huckfield

The information is as follows:

1960–1977" in Trade and Industry of 22nd September, giving information for the rate of return on capital for North Sea exploration and production activities, for industrial and commercial companies, and for manufacturing companies (both excluding North Sea activities) for the years up to and including 1977.

Mr. Cryer

North Sea exploration and production activities are not part of manufacturing and, therefore, are excluded from the figures for manufacturing companies published in Table 1, columns 4, 5 and 6, of the article referred to.

Rates of return for the activities of industrial and commercial companies other than North Sea activities are given in the table below.

Rates of return on capital for North Sea activities as a separate sector and in comparison with those published in the article and in the table below are not very meaningful. Development in the North Sea has been rapid and there are long lags between investment expenditure and associated production and profits. Profits are currently accruing from only a relatively small part of the North Sea capital stock but under national accounting conventions the rate of return is calculated on the whole of the capital stock. The resulting rates of return cannot therefore be easily compared with those in the article or given below which are not, to the same extent, affected by such lags.

RATES OF RETURN ON CAPITAL EMPLOYED FOR INDUSTRIAL AND COMMERCIAL COMPANIES EXCLUDING THEIR NORTH SEA ACTIVITIES
Per cent.
At replacement costs
At historic costs Before providing for Stock Appreciation After providing for Stock Appreciation
(1) (2) (3)
1966 14.5 11.1 10.3
1967 14.1 11.1 10.6
1968 15.0 11.6 10.4
1969 15.1 11.5 10.1
1970 14.4 10.4 8.7
1971 15.0 10.3 8.7
1972 15.8 10.3 8.6
1973 17.3 10.4 7.2
1974 17.1 9.1 4.0
1975 15.5 7.0 3.4
1976 17.3 7.4 3.6
1977 16.4 6.6 4.0

Note: For years up to and including 1965, the figures are identical to those published in Table 1 (columns 1,2 and 3) of the article.