<p>Three years have elapsed since Profit-related Pay (PRP) was introduced and it is of interest to review what was heralded as an exciting and ambitious initiative. The Government clearly wishes PRP to 'catch on' and the 1991 Budget provides that bonuses paid under the scheme are now completely exempt from tax. Profit-sharing, broadly defined, has been strongly advocated and is widely practised. A survey by Baddon et al. (1987) indicated that 65 per cent of establishments in the private sector operate some form of employee financial participation scheme. In view of this and the tax relief available, it is puzzling that the number of PRP schemes that have been registered is far below the expectations of its protagonists.</p>
Authors
![Person graphic](/sites/default/files/styles/square_desktop/public/2022-06/IFS-person-graphic.png?itok=hWCtTSrz)
Robert Luther
Journal article details
- ISSN
- Print: 0143-5671 Online: 1475-5890
- Issue
- August 1991
Suggested citation
Luther, R. (1991). 'The Government's profit-related pay initiative: three years on ' (1991)
More from IFS
Understand this issue
![Christine Farquharson](/sites/default/files/styles/square_desktop/public/2024-07/Christine%20early%20years.jpg?itok=SRfpSwOQ)
Childcare and the early years: what are the new entitlements and how will they be delivered?
explainer
IFS Associate Director Christine Farquharson explains.
1 July 2024
![Edge of rural town](/sites/default/files/styles/square_desktop/public/2024-07/levelling%20up%20feature.jpg?itok=HJBdqLuW)
Levelling up: it’s time to step up
comment
The gap in employment rates between the best- and worst-performing areas is at its widest since 2005, says Christine Farquharson.
30 June 2024
![Christine Farquharson](/sites/default/files/styles/square_desktop/public/2024-07/christine%20levelling%20up.jpg?itok=PrW344C_)
What is ‘levelling up’ and how much progress has been made?
explainer
IFS Associate Director Christine Farquharson explains.
29 June 2024
Policy analysis
![Welsh town with mountains behind](/sites/default/files/styles/square_desktop/public/2024-06/Welsh-town-feature.jpg?itok=5axb5wZn)
How would the parties’ tax and spending plans affect Scotland and Wales?
report
This ‘explainer’ looks at how the parties’ proposals would affect Scotland and Wales, covering tax, spending, public finances and the constitution.
28 June 2024
![Breakfast club](/sites/default/files/styles/square_desktop/public/2024-06/Breakfast-club.jpg?itok=dEyGgrwT)
Free breakfast clubs in schools: what Labour’s plans would mean for pupils and families
comment
Labour’s manifesto promises free breakfast clubs in all primary schools. This comment examines possible benefits and challenges with the policy.
25 June 2024
![Man putting vote into ballot box](/sites/default/files/styles/square_desktop/public/2022-07/Man-putting-vote-into-ballot-box.jpg?itok=Pa6g41dr)
General Election 2024: Manifesto Analysis Presentations
presentation
IFS researchers presented their analysis of the manifestos ahead of the 2024 general election.
24 June 2024
Academic research
![Fiscal Studies - 2024 - June cover](/sites/default/files/styles/portrait/public/2024-06/Fiscal%20Studies%20-%202024%20-%20-%20June%20cover.jpg?itok=mQEwRc_w)
Inequality in Denmark, 1987–2021
journal article
We investigate the progression of income inequality in Denmark over the years 1987–2021.
28 June 2024
![Fiscal Studies - 2024 - June cover](/sites/default/files/styles/portrait/public/2024-06/Fiscal%20Studies%20-%202024%20-%20-%20June%20cover.jpg?itok=mQEwRc_w)
Components of the evolution of income inequality in Sweden, 1990–2021
journal article
This paper documents how the inequality of household equivalent disposable income has changed in Sweden over the period 1990–2021.
28 June 2024
![Fiscal Studies - 2024 - June cover](/sites/default/files/styles/portrait/public/2024-06/Fiscal%20Studies%20-%202024%20-%20-%20June%20cover.jpg?itok=mQEwRc_w)
Fiscal Studies: Volume 45, Issue 2
journal issue
Fiscal Studies: Volume 45, Issue 2
28 June 2024