Public Limited Companies (Financial Regulation)

Part of the debate – in Westminster Hall at 3:02 pm on 13th March 2003.

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Photo of Mr Howard Flight Mr Howard Flight Shadow Chief Secretary to the Treasury 3:02 pm, 13th March 2003

May I put it to my hon. Friend that the problem with Sir David Tweedie's proposals is that they are intended to stop the abuse of share option schemes such as no doubt occurred in the United States? The tragedy is that the proposals would also kill off the highly beneficial and widely spread employee share schemes, which have been a great success in this country in spreading wealth, encouraging employee participation and improving productivity. Companies issue shares at a discount under the employee share schemes introduced by previous Governments and this Government. The companies would be forced to account for them in the profit and loss statement, and that would be wholly inappropriate in principle. The main objection to the proposal is that it has taken a draconian stance towards abuse and forgotten about the good things that it would also kill off.