CO-PARTNERSHIP SCHEME

Wanganui Chronicle, Volume LXXXIII, Issue 19737, 5 January 1927, Page 9

CO-PARTNERSHIP SCHEME

BRITISH COMPANY’S PROFITS OPTION TO TAKE SHARES AT PAR. Resolutions providing for the adoption of a scheme of co-partnership were recently submitted to a special meeting in London of shareholders of the Brush Electrical Engineering Company, Limited. Mr. E. Garckle (the chairman of the company) said the scheme was approved in principle at the annual meeting held in June, and a provisional co-partnership council had immediately been appointed. A brief outline of the scheme stated that, after providing for depreciation and all necessary charges, and a dividend at the rate of 10 per cent, for the year on the ordinary shares, the surplus would be distributed to the three classes of •employees and to the shareholders in proportion to the' total wages, salaries and dividends paid for the year. The amounts so distributed could, at the option of the' recipients, be invested in ordinary shares of the company at par. These shares of £1 e'ach had a present market value of 26s or 275. Thus the recipients of the distribution of surplus would receive an additional bonus represented by the premium on the shares. There were no restrictions whatever imposed on the shares issued to the employees; they would rank in every respect equally with the shares now issued. It was decided at the last meeting of shareholders that the scheme should be deemed to come into operation as from January 1, 1926, and that the surplus profits in respect of the yeat 1925, amounting to £8751, should be distributed as a bonus in accordance with the' scheme as if the scheme had been in force for the year 1925. The provisional co-partnership council had decided that this bonus, after deducting the proportion belonging to the shareholders in accordance wilh the' scheme, should be applied in payment of ordinv shares required for distribution te the co-partners who were entitled to a share in this bonus as on December 31, 1926. The third point in the resolutions r* lated to the undivided profits, amounting to £76,190. This amount belonged to the shareholders, and was at present contemplated as a reserve for the purpose of maintaining an average dividend of 10 per cent, per annum on the shares. Under the scheme they were propos ing, the directors were asking both tho shareholders and the employees of the company to move in the direction of producing better social conditins, which, he said, would be attained when all workers were capitalists and all capitalists were producers, and neither was a consumer only. Labour must dismiss the notion that restriction of output could be of anv benefit to themselves or their fellows. On the other hand, shareholders must not expect to obtain the largest possible return on their capital if that meant lowering wages, reducing output and raising prices. The resolutions were unanimously adopted.