Growth Of Profit Sharing In Britain

Press, Volume XCI, Issue 27690, 21 June 1955, Page 13

Growth Of Profit Sharing In Britain

(Rec. 7 p.m.) LONDON, June 20. Sir Anthony Eden undoubtedly takes very seriously his reference in Parliament to the desirability of “the workers having in some form an increasing share, direct or indirect in the industry’ in which they work. Call it profit sharing, copartnership, or whatever you like,” says the weekly journal, the “Economist.” The journal continues: “The election result in the 1.C.1. dominated constituency of Cleveland, where the Labour majority was cut from 5481 to 181 after the local Tory candidate had claimed that nationalisation would rob the workers of benefits of their profitsharing scheme, was dhe that appeals to Sir Anthony Eden’s turn of mind. “The Government hopes that the growth of industrial profit-sharing schemes in the next half decade will be as great as the growth of industrial pensions schemes in the last one; then by 1960 all constitutencies may feel about nationalisation as Cleveland clearly does already. “To help the good work along, the Government is likely to collect and publish more information about types of profit-sharing schemes that are already in being, and the Minister of Labour may be asked to pour honeyed words into the ears of every industrialist he meets, suggesting that his company should adopt one or other of them.

“In addition, Mr Butler will be helpful about profit-sharers’ tax problems. No More Harm to Shareholders “One thing that may help the movements forward is that profit-sharing schemes often seem to be financed initially at the expense of ordinary shareholders for whose fortunes both politicians and boards of directors are apt to show scant regard. “In the long run, however, there is no real reason why a ‘profit-sharing’ scheme should hurt the shareholder more than any other wage increase. “But there are two barriers in the way of real success for this movement,” says the journal. “One is that ratio of ‘shared profits’ to total wages can never be very high; after all before-tax ordinary dividends amounted last year to only 5 per cent, of personal incomes, and it is not proposed to sequestrate all of them. “The other is that workers in profitable industries have always enjoyed higher earnings than workers in unprofitable ones: the ‘profitsharing’ movement is simply an attempt to give a new name and greater formality to the system that is in operation in all capitalist countries already. This is one reason why politicians should not get too excited about it. “But* then* may be advantages in a new name, and even the grandiloquent term ‘co-partnership,’ as applied to some of these schemes, is no more a euphemism than is the term ‘public control’ when applied to nationalised industries.”

A message from Washington says that Mr Eugene Meyer, the chairman of the board of the “Washington Post” company, has announced that he and his wife: Mrs Agnes Meyer, had given almost 500,000 dollars of stock in the company to 711 employees and circulation contractors. The 711 to whom the gifts were made were employees and circulation contractors of the “Washington Post" and “Times Herald.” and employees of the conwany’s broadcasting stations in Washington and Jacksonville. Florida. The new stockholders were those with five or more years of continuous service. They received amounts ranging from four to 20 shares, apportioned on a basis of length of service and responsibilities with the company. Each share had a current book value of 60 dollars. Mr Meyer, who is still active in company affairs, althouch he will be 80 on October 31. said at a staff luncheon: “Some people remember their old associates in their will*. But Mrg Meyer and I both thought that a rather melancholy approach to things. So we have worked out a plan to recognise you today.”