UK - Dividends paid by BP and Royal Dutch Shell amounted to a quarter of the dividends paid by UK listed companies last year. Yet experts have warned the true picture may not be as good this year as growth is expected to "stagnate" or even fall among oil and gas giants.

A study of UK dividends was conducted by Capita Registrars, and found £57bn (€bn) was paid in dividends last year, £10bn less than in 2008, however approximately 70% came from the top 10 companies as BP and Shell superceded HSBC to become the biggest payers.

Only healthcare, utilities, oil and gas firms raised their dividends in 2009, and it was only the oil and gas, healthcare and utilities sectors where dividends increased on the previous year.

That said, "smoking, drinking and eating keep the dividends growing," suggested Capita, as defensive stocks remain favoured

After adjusting figures for cash calls, the true sum paid out in dividends was actually less than the £73bn raised by companies in 2009, of which £41bn was claimed by banks.

Officials suggest the UK listed market and dividend payments should see a modest 5% growth on last year, to £59.bn.

However, Capita Registrars warned oil and gas companies, considered to be "the engine of growth" last year "stalled" at the end of the year, and could struggle to generate growth in 2010, with "stagnation likely in 2010", even though they are predicted to be the biggest payers of dividends this year.

"The latest Q4 results announced by BP cut the sterling dividend by 12%," said the report. If other sectors do not take up the baton, our forecast [of 5% growth] may even prove optimistic."

Dividends are less important to UK pension fund investors these days, as the UK government removed the tax benefits earned from these assets in 1997, and in turn removed approximately £5bn a year in returns.

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