On 04 June, 2014, at 3.52pm BST, Cameron said inequality is at its lowest level since 1986. I really thought I’d misheard him. This isn’t the first time Cameron has used this lie. We have a government that provides disproportionate and growing returns to the already wealthy, whilst imposing austerity cuts on the very poorest. How can such a government possibly claim that inequality is falling, when inequality is so fundamental to their ideology and when social inequalities are extended and perpetuated by all of their policies? The standard measure of inequality is certainly being used to mislead us into thinking that the economy is far more “inclusive’ than it is.
Dr Simon Duffy authored report – A Fair Society? – last year, for the Centre for Welfare Reform, about how the austerity cuts have been targeted. He said:
- People in poverty are targeted 5 times more than most citizens
- Disabled people are targeted 9 times more than most citizens
- People needing social care are targeted 19 times more than most citizens
“The UK is the third most unequal developed country in the world and most disabled people live in poverty. The current policy is guaranteed to increase inequality and to make extreme poverty even worse.”
I also wrote an article last year – Follow the Money: Tory Ideology is all about handouts to the wealthy that are funded by the poor. I said:
The following cuts came into force in April 2013:
- 1 April – Housing benefit cut, including the introduction of the ‘bedroom tax’
- 1 April – Council tax benefit cut
- 1 April – Legal Aid savagely cut
- 6 April – Tax credit and child benefit cut
- 7 April – Maternity and paternity pay cut
- 8 April – 1% cap on the rise of in working-age benefits (for the next three years)
- 8 April – Disability living allowance replaced by personal independence payment (PIP)
- 15 April – Cap on the total amount of benefit working-age people can receive
Here are some of the “incentives” for the wealthy:
- Rising wealth – 50 richest people from this region increased their wealth by £3.46 billion last year to a record £28.5 billion.
- Falling taxes – top rate of tax cut from 50% to 45% for those earning over £150,000 a year. This is 1% of the population who earn 13% of the income.
- No mansion tax and caps on council tax mean that the highest value properties are taxed proportionately less than average houses.
- Benefited most from Quantitative Easing (QE) – the Bank of England say that as 50% of households have little or no financial assets, almost all the financial benefit of QE was for the wealthiest 50% of households, with the wealthiest 10% taking the lions share
- Tax free living – extremely wealthy individuals can access tax avoidance schemes which contribute to the £25bn of tax which is avoided every year, as profits are shifted offshore to join the estimated £13 trillion of assets siphoned off from our economy.
I also said: “A simple truth is that poverty happens because some people are very, very rich. That happens ultimately because of Government policies that create, sustain and extend inequalities. The very wealthy are becoming wealthier, the poor are becoming poorer. This is a consequence of “vulture capitalism”, designed by the opportunism and greed of a few, it is instituted, facilitated and directed by the Tory-led Coalition. ”
Inequality Briefing reports that richest fifth of the UK population saw their incomes increase by £940 in 2013. But incomes were down by £250 for the other 80% of the population… and by £381 for the poorest fifth , according to data from the Office for National Statistics (ONS)
Thanks to Inequality Briefing for the info graphic and summary
To download the full pdf, click here
Explaining the data
This data compares the ‘equivalised disposable household income’ for 2011/12 and 2012/13. It was published by the Office for National Statistics as part of ‘the effects of UK tax and benefits on household income 2012/13 study.’ ONS have found that the recession did have a small effect on reducing inequality, but it now looks as though inequality is set to increase.
It has increased. Just as we have predicted.
Picture courtesy of Robert Livingstone
Other relevant articles:
Quantitative data on poverty from the Joseph Rowntree Foundation
Welfare reforms, food banks, malnutrition and the return of Victorian diseases are not coincidental, Mr Cameron
The poverty of responsibility and the politics of blame
“We are raising more money for the rich” – an analysis
Cameron’s Gini and the hidden hierarchy of worth
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