To: The Kay Review
Department for Business Industry & Skills, Spur1, Floor 3, 1 Victoria Street, London SW1H 0ET
From: UK Shareholders Association 25th April 2012

Dear Sirs,

Further to your Interim Report of February 2012 and our first submission of 25 November 2011, we would like to draw attention to the latest ONS bulletin (28 February 2012) on Ownership of UK Quoted Shares 2010. This appears to have had little publicity but the figures show the first reversal of the long term trend for the reduction in holdings by UK individuals, indicating an increase from 10.2% to 11.5% in just two years. The survey suggests that this may be due to the low yields available on alternative investments. A December 2011 report from Capita states that private shareholdings were above 12% in the first part of 2011.

If the figures are to be relied upon, they suggest to us that, given further encouragement by Government and the impact of the implementation of the RDR, a much more significant increase is possible over a period of years. Moreover since the ONS gives "Rest of the world" as 41.2% it follows that individuals have 20% of those shares actually held within the UK, i.e. those where any action following your final report is likely to be effective. Further, it is generally accepted that the proportion of a company held by private individuals is broadly in inverse ratio to the size of the company. This leads us to conclude that private shareholders could still have a real impact in the smaller company market where, surely, the engines for growth are to be found