§ Mr. Peter Lloydasked the Chancellor of the Exchequer what information he has as to the proportion of personal incomes saved in 1965, 1970 and in each year since 1975; what proportion of these savings was held in liquid form as most conveniently defined; and if he will set out the definition used.
§ Mr. BrittanI can supply the following information on the personal sector as defined in the national system:
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Saving as Percentage of total disposable income in each year (saving ratio) Net investment in liquid assets as percentage of saving in each year Liquid assets held as a percentage of net wealth at end of each year A B C 1965 9 67 †24 1970 9 76 23 1976 12 58 20 1977 11 83 19 1978 13 74 19 1979 14 80 18 1980 15 67 ‡ † Relates to end-1966; comparable information for end-1965 is not available. ‡ Information for end-1980 not yet available. Sources
Col. A — Personal income and expenditure account (Financial Statistics Table 10.1, latest issue).
Col. B—derived from sources and uses of funds account of the personal sector (Financial Statistics Table 10.2, latest issue).
Col. C — derived from balance sheet of the personal sector (Financial Statistics Supplementary Table C, February 1981 issue).
In interpreting column B it should be borne in mind that amounts saved and amounts invested in liquid assets are both affected by other factors such as borrowing and transactions in physical assets and non-liquid financial assets. Further information on personal sector sources and uses of funds is provided in the source given.
A wide definition of wealth is used as the denominator in column C, covering physical and financial assets at market value, including consumer durables and equity in life assurance and pension funds, less liabilities. Narrower definitions of wealth, if required, can be derived from the source given.
In columns B and C liquid assets include notes and coin, deposits with the banking sector, building societies and other financial institutions, national savings, local authority temporary debt and tax instruments.