Inequality concept - one person on a taller pile of stones than the other

While we live in an era dominated by post-Brexit politics and the pandemic, new realities bring fresh perspectives on the same old perennial issues.

One such issue recently brought back into focus was that of inequality: Labour leader Keir Starmer in his recent speech, ‘New Chapter for Britain’, argued that “inequality is not only morally bankrupt, it’s economic stupidity”. Sources accessed from the AMSR can help provide a historical context to his comments, offering insights into inequality and quantifying the importance people attach to it.

An article in The Social Research Association magazine Research Matters in 2018 pointed out that the 1980’s saw large increases in inequality as measured by the Gini coefficient, followed by smaller increases afterwards.[1] This then declined when the recession of 2007-2008 started, but it also showed that there is a more extreme story to tell if we focus on inequality at the top and bottom ends of the income scale. Figures from the Institute for Fiscal Studies show that the share of national income accounted for by the top 1% rose from 7% in 1981 and peaked at 13% in 2015, since when it has dipped but only by a little. MORI’s monthly public opinion tracking of “Most important issues” from December 2000 goes some way in explaining the difficulties in tackling the issue from a political perspective. When asked to volunteer which issues they thought most important, fewer than 1 in 10 chose poverty and inequality, and the issue consistently sits mid-table, below issues like race/ immigration, public transport and pensions.

It seems fair to assume that tax reforms are required if inequality is to be addressed. However, this is not simple: for example, another article from Research Matters in 2012 pointed out that increased investment in skills can increase incomes across the entire population and may reduce the poverty, but not close the inequality gap.

In 1990, on her last day in Parliament, Margaret Thatcher spoke of the Labour Opposition that “So long as the gap is smaller, they’d rather have the poor poorer”. But the public mood may now be more susceptible to Starmer’s recent words on the subject. In 1983, when the top rate of income tax was 83%, as many as 54% wanted government taxation and spending to stay as they were. Yet by December 2019 (just before Covid) a MORI poll showed fully 62% wanted an increase in taxation in order to pay for higher spending on social care. However, as opinion polling accessed in the Archive has suggested, dealing with the issue of inequality will not be simple.

[1]  The Gini coefficient measures the distribution of income across a population developed by the Italian statistician Corrado Gini in 1912. It is often used as a measure economic inequality or income distribution.


This information about Inequality can be found in the AMSR Archive (www.amsr.org.uk) in:

Research Matters, magazine of the Social Research Association, December 2018: https://amsr.contentdm.oclc.org/digital/collection/p21050coll22/id/1437/rec/104
and December 2012: https://amsr.contentdm.oclc.org/digital/collection/p21050coll22/id/1412/rec/100

MORI Monthly tracking survey – Most important Issues, 2000: https://amsr.contentdm.oclc.org/digital/collection/MORI-BPO/id/1807/rec/1


Contributed by Jacob Bartram
Date posted: 3rd March 2021


 

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