Try It

‘The dividend deceit: getting away with it’

Home Tomorrow's Business ‘The dividend deceit: getting away with it’

Tomorrow's Business Today

'The dividend deceit: Getting away with it'

The dividend debate has shifted lately.

In the early days of Covid the script was mostly that big companies should hang on to their cash, since they had no idea when they might need it later (some companies, banks, are banned from shareholder payouts).

Lately, large businesses have had a different take – that since they are strong enough to pay divis, they should.

That has even included some businesses that took furlough money and aren’t in a hurry to pay it back.

Sainsbury is one of the retailers under fire for paying a divi after receiving relief on business rates.

The typical line from companies has gone like this from Telecom Plus: “We paid dividends as we were able to do this responsibly. In doing so we ensured those shareholders who are reliant on the dividends (eg pensioners) would retain this important source of income”.

On the face of it that sounds noble – they’re just looking after the poor pensioners.

We should make a point of asking what percentage of the dividend is going to retired investors. The answer must be: a tiny one.

By some accounts, UK pension funds themselves only own 3% of the FTSE 100. So the money isn’t even going to pensioners in the future.

The flaks are getting away with this one.


Tomorrow's Business

Roxhill updates

Click below to choose which updates your receive.


Dear Boris, You are completely useless, sincerely...

Tomorrow's Business

How to be a journalist


Similar Posts

News & Updates

Subscribe to our newsletters

Tomorrow's Business Roxstars

We use cookies to enhance site navigation, analyze site usage, and assist in our marketing efforts. Accept cookie settings by clicking the button.
You can view our Cookie Policy or Privacy Policy.