§ Mr. Meacher
asked the Chancellor of the Exchequer (1) what he estimates have been the net post-tax profits, after depreciation allowances, accruing to private industry for each year since 1946 from respectively gross fixed capital formation and purchases of goods and services by nationalised industries;
(2) what he estimates has been the annual addition to rentier incomes and private profits directly due to the operation of the nationalised industries for each year since 1950; and what he estimates has been the direct subsidisation of the private sector due to selling nationalised industry products below the real cost of production.
§ Mr. Nott
No estimates can be made along the lines requested for private sector profits or for private investment incomes. In general, firms do not separate how much profit is attributable to a particular element of turnover such as sales to nationalised industries. Interest payments by public corporations are mostly to the central Government, and the effect on private investment incomes of public—rather than private—ownership of industry is mainly to change the composition, rather than the amount, of the income flow arising from private holdings of both public sector and private sector debt.
In order to answer the latter part of the hon. Gentleman's second Question, it would be necessary to define what is meant by the "real cost of production". As a broad indication, the table below shows for years since 1950 the amount of subsidies from the central Government to nationalised industries, and the net amount of debt written off. The larger part of the subsidies and write-offs has arisen from difficulties in specific sectors, for example, the level of demand for railway services, and not from products being sold below their cost of production.
NATIONALISED INDUSTRIES £ million Subsidies Write-off of debt (net) 1950 7 — 1951 4 — 1952 1 — 1953 2 — 1954 4 —
£ million Subsidies Write-off of debt (net) 1955 — — 1956 — — 1957 — — 1958 — — 1959 — — 1960 115 — 1961 137 — 1962 140 — 1963 135 432 1964 122 — 1965 138 525 1966 143 — 1967 174 — 1968 180 10 1969 124 1,258 1970 104 255 1971 94 — 1972 309 350
1. Figures relate to the nationalised industries only and exclude other public corporations.
2. Subsidies are those specific to the nationalised industries only and exclude items, such as employment premiums and bus fuel grants, which are also available to the private sector.
3. The figures exclude the £42 million special Brant paid to British Rail in 1972–73 to cover their cash flow shortfall.