Businesses: Employee-shareholder Scheme

Lord Howell of Guildford Excerpts

Thursday 9th January 2014 Lords Chamber

[Viscount Younger of Leckie]

My noble friend would expect—and will not be surprised—to hear me say that it is not my department’s responsibility to formulate tax policy, and that the figures that were given during the course of discussions on the Bill were very much estimates.

[Lord Howell of Guildford (Con)]

My Lords, while employee share schemes may be less than perfect, and we have heard some negative remarks about them, does the Minister accept that the concept of spreading ownership as widely as possible in our society, turning earners into owners and enabling all parts of society to share fully in the asset growth of the nation is a very good theme that all parties, and their leaders, should strongly encourage, as we have sought to do in the past?

[Viscount Younger of Leckie]

My noble friend makes a very important point. Indeed, it is true that businesses where employees have a stake in the company have been seen to perform better than those where that is not the case. The employee ownership index has outperformed the FTSE all-share by an average of 10% since 1992, so successful employee-owned businesses do see the engagement of the workforce as an integral feature of how the business is run.