asked the Chancellor of the Exchequer what are the rules followed by the Treasury in approving dividend increases in excess of 10 per cent. per annum.
The areas where Treasury discretion is likely to be exercised in approving dividend increases in excess of 10 per cent. were described in Section III of Cmnd. 5444. Since then, two additional grounds for exemption were introduced by Treasury announcements on 20th October 1975 and 16th January 1976. It is not possible to specify precise rules applicable to all cases, and each application is therefore treated on its merits. Precedents and circumstances are taken into account; for example, the amount of increase allowed where new capital is being raised relates to the yield considered necessary to secure the success of the issue.