Inequality Britain

Ian Malcolm-Walker (Bournemouth West CLP) looks at growing income disparities across the UK.

Britain is an unequal society. UK income inequality is among the highest in the developed world and evidence shows that this is bad for almost everyone. That is the conclusion of the Equality Trust and of Richard Wilkinson and Kate Pickett’s book The Spirit Level published in 2009.

Income inequality in the UK has been getting worse. Someone in the bottom 20% of UK incomes will have lower life expectancy than someone in the top 20% irrespective of where they live. Since people with better incomes tend to be concentrated in different areas to those with lower incomes, where you live becomes a proxy for affluence when looking at life expectancy. The narrower the focus the truer that becomes.

On average, according to Age UK, life expectancy at age 65 was highest for men in Harrow, where they could expect to live for a further 20.9 years compared with 15.8 years for men in Manchester. Men born in Glasgow’s deprived east end will die nine years before men born in India. And male children born a 15-minute drive away in affluent Lenzie can expect to live 28 years longer. Born in the Calton and you will live to 54 on average – in Lenzie 82.

The Child Poverty Action Group in Scotland have rightly observed that “it is completely unacceptable that in 21st century Scotland, in one of the richest countries in the world, a child’s life expectancy can be undermined by the circumstances they are born into.”

Over the last 20 years, a Glasgow Centre for Population Health report found that life expectancy in the 20% most affluent and 20% least affluent communities in the West of Scotland has deviated noticeably.

There is an indicator called the Gini co-efficient. Expressed crudely, if everyone had the same income it would be 0 and if one person had all the income it would be 1.

In the UK the richest 20% earn nearly 7 times as much as the poorest 20%. In the 1970s the UK Gini was .338 rising steadily to .458 around 2000, sliding back a little to .445 in the mid-2000s, before climbing again to .456 at the end of the decade.

Share of all income received by the richest 1% in Britain Graphic: Danny Dorling - Fair Play, The Policy Press, 2012

Share of all income received by the richest 1% in Britain
Graphic: Danny Dorling – Fair Play, The Policy Press, 2012

Following Susan Press’ piece in the last edition of Briefing there were some comments on line on the concept of a North-South divide. In my view there is a North-South divide. It’s not straightforward and needs to be understood and qualified. But it exists and it matters.

Earnings are measured by the Annual Survey of Hours and Earnings. (ASHE) UK average annual earnings in 2013 were £27,174. Three regions London, the South East and the Eastern region had higher averages. All other English regions, the devolved nations and the North of Ireland were lower.

These are the averages for whole regions and there are pockets of relatively higher earnings in all the below average areas and pockets of relatively lower earnings in the three higher than average regions. For example, in the North West the average for Trafford was £31 265 (15% above national average and 27% above regional average).

In the South East, in Portsmouth earnings only averaged £21, 840 (20% below the national average and 29% or a whopping £175 per week below the regional average.)

In London, earnings in Newham and Barking and Dagenham are below the national average. Since ASHE is a residential survey there are no doubt other boroughs, just as there will be places in the South East and Eastern regions, where average earnings are inflated by people working in Central London.

The South West is peculiar. Its average earnings are below the national average yet it is not northern by any stretch of the imagination. Its house prices are also above average.

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