Dividends (Limitation).

Oral Answers to Questions — National Finance. – in the House of Commons on 4th June 1942.

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Photo of Sir Geoffrey Mander Sir Geoffrey Mander , Wolverhampton East

asked the Chancellor of the Exchequer whether, in view of the fact that dividends are being paid by some companies in excess of those de clared pre-war, he will consider the advisability of taking steps to prevent this by the limitation of dividends to a pre war level?

Photo of Sir Kingsley Wood Sir Kingsley Wood , Woolwich West

Generally speaking, I think the request which I made two years ago for the limitation of dividends has been complied with, and I doubt whether any exceptions to the general rule have been sufficiently numerous or important to justify me in reviving proposals for legislation. I would, however, take this opportunity of stating that the objects of the limitation, where they are applicable, are even more important than in 1940. Those objects are to prevent increases in the purchasing power of shareholders and to enable the companies concerned to give their maximum support to our War Loans.

Photo of Sir Geoffrey Mander Sir Geoffrey Mander , Wolverhampton East

Do I understand that the Government would not consider it in the public interest for dividends above the pre-war level to be paid in existing, circumstances?

Photo of Sir Kingsley Wood Sir Kingsley Wood , Woolwich West

I would like my reply to be taken as my own observations on that point.

Photo of Mr Herbert Williams Mr Herbert Williams , Croydon South

Would it not be rather helpful if certain companies which were very prosperous before the war cut their dividends?