Inequalities in the UK

The financial crisis of 2008 and ensuing recession led to falls in earnings in the United Kingdom, not seen since the Great Depression of the 1930s, and it was only in 2014 that overall household income returned to its pre-crisis levels. At the same time, according to one official measure, income inequality has actually fallen, although different data indicate no change. This situation follows from several factors, notably the continued growth in pensions, higher earnings of lower-income households as these have worked more since the recovery in 2013, and the continued stagnation of earnings in higher income households (even if very high incomes have continued to pull away from the rest of the population). Incomes of younger workers also remain below their pre-crisis peak. This chapter shows, however, that the picture of poverty and inequality in the United Kingdom is far more complex than suggested by the main measure of income inequality. To this end, it begins by reviewing the definitions of poverty and inequality, in order to provide a broader overview of these pressing but complex social problems. The chapter goes on to examine wealth inequalities, the impact of housing costs on inequality and poverty, and it concludes by presenting recent studies suggesting that Brexit may well lead to future rises in inequality, as higher inflation could well hit lower-income households most.

Until the 2008 Crash, the prevailing economic orthodoxy, accepted across the broad political spectrum, was that inequality was a necessary condition for economic health. The evidence of the last four decades is that this trade-off theory – that you can have more equal or more efficient economies but not both – is incorrect. Not only do excessive concentrations of income and wealth bring social dislocation and breed public discontent with democratic institutions, but a number of studies have shown that inequality on today’s scale brings slower growth and greater economic turbulence. Although there is now a broad acceptance amongst global leaders that inequality poses significant risks for social cohesion and economic stability, there has been little or no action to match the high level verbal war against inequality. As a result, inequality has carried on rising within nations since 2008. In the United Kingdom, the gap between the top and bottom has continued to widen, in part because post-2010 governments have weakened the pro-equality role of the state. Tackling inequality is now one of the most pressing issues of the day – an economic as well as a social imperative – while reversing this four decade long trend will require a major restructuring of the pro-market economic models in place across most of the rich world.

The North/South divide is an image frequently used to depict the territorial structure and the economic dynamism of England, and thus to describe the social and economic geography of the country. This image distinguishes a post-industrial North, which still faces economic and social difficulties, from a tertiary, rich and powerful South. It separates a central space (the South) from a periphery (the North). However, the recent economic changes in Britain question the relevance of this image, which is perhaps too simplistic to describe accurately the economic and social geography and the spatial disparities in the country.

Since the Thatcher years, this debate on the North/South divide has been constantly renewed, regardless of the political colour of the majority at Westminster, and the local and regional policy of the government in power has been systematically criticised. On the one hand, this reflects the persistence of territorial and social disparities in the United Kingdom and more specifically in England. On the other hand, this shows that the North/South divide is not just a geoeconomic question, but it also includes identity, societal and geopolitical issues.

Based on a geographical, critical geopolitical and cartographic approach, the aim of this chapter is to question the relevance and the significance of the North/South divide in 2017, after the impact of the 2008 Great Recession, as the United Kingdom is on its way to Brexit and when its unity is being challenged by Scottish nationalism. How can territorial disparities be described, evaluated and measured in England? How are they perceived by citizens and political leaders? This chapter will also study the policies proposed to close this gap and to meet the aspirations of peripheral regions.

This chapter explores the inter-urban dimensions of contemporary inequality in the United Kingdom. It does so by drawing on quantitative measures of inequality from the British Broadcasting Corporation’s ‘Great British Class Survey’ experiment of 2011–2013 and representative economic indicators of productivity. It takes its starting point as an acknowledgement of the deepening inequalities in western, developed economies, a reality reflecting in the burgeoning of literature on macro-economic disparities at the start of the twenty-first century. Whilst invaluable, this literature has tended to focus solely on economic definitions of inequality between countries or regions. The purpose of this chapter is to continue the expansion of our understanding of the manifold dimensions of inequality into the social and cultural domains. The data from the Great British Class Survey are uniquely positioned to do this: approximately 325,000 people participated in the online questionnaire, providing information not just on their stocks of economic capital but also on the size and scope of their social networks and the nature and extent of their cultural activities. The size of the sample thus provides an unparalleled tool for analysing the complex nuances of contemporary inequality in the United Kingdom using a framework informed by the theoretical approach to cultural class analysis pioneered by Pierre Bourdieu. The analysis here focuses solely on inter-urban disparities in the United Kingdom and demonstrates the ways in which economic inequalities are reflected and reinforced in the social and cultural domains.

The Minimum Income Standard (MIS) research gives an insight into living standards in the United Kingdom, and provides a way of tracking the adequacy of incomes over time. As such it offers useful context for discussions of inequality. At the core of the research are deliberative groups held with members of the public who identify and discuss the goods and services that are considered necessary for a living standard that provides a socially acceptable minimum. Groups decide not only what is enough to maintain health and well-being, but also what is needed for social inclusion. This chapter begins with an outline of MIS before exploring what the qualitative data from the research tell us about how people conceptualise socially acceptable living standards. These data also reveal how particular items, opportunities and choices are considered important in enabling individuals to feel socially included and how that has changed over time. The chapter then looks at how this living standard relates to UK household incomes and at the adequacy of income relative to MIS, in the years following the recession. We identify the groups at greatest risk of having inadequate incomes and explore how this risk has changed during a period in which there has been a sustained decline in living standards. In combining qualitative and quantitative findings from a decade of research, this chapter provides rich insight into living standards and their relation to income within the United Kingdom.

The secondary analysis of the European Union Statistics on Income and Living Conditions (EU-SILC) is used to examine inequality in the United Kingdom compared with other European Union (EU) countries and to analyse how inequality has changed over the period from the start of the great financial crisis in 2008–2015. The analysis compares inequality in market income, gross income and disposable incomes, and measured inequality using the Gini coefficient, 80/20 and 90/10 ratios. It includes an analysis of the impact of cash benefits and direct taxes on market income and how the composition of households in different parts of the income distribution has changed over time. In addition, inequality within the EU is explored. The chapter concludes with a discussion of what contribution the EU itself through its own institutions and policies plays in mitigating market inequalities. We find that the distribution of market income in the United Kingdom is comparatively unequal, but the UK’s relative position on disposable income is greatly improved, due to an effective system of direct taxes and transfers. The conclusions remain broadly similar for all the inequality indices that are considered. There is evidence that households with children have moved down the distribution between 2008 and 2014 and aged households have moved up the distribution in most EU countries including the United Kingdom. The chapter concludes that EU policies have relatively little impact on inequality and that inequalities can really only be tackled using national redistributive policies.

Labour emerged as a political party with an egalitarian mission, pledged to tackle the stark inequalities that disfigured British society. But since the advent of New Labour this mission has been radically redefined, signalled by a shift from egalitarianism to meritocracy. This chapter is divided into three sections, each exploring themes on the party’s orientation to inequality, dealing, respectively, with the New Labour government (1997–2010), the period of the Miliband leadership (2010–2015) and, finally Labour under the Corbyn leadership (2015 to the present). It investigates, during the first two phases, the conceptual and ideological shifts in attitudes to equality, what has prompted them and how they have been articulated in policy forms. In the third period – Labour under Corbyn – where progress on policy development has been slow, it changes focus to concentrate on one of the most formidable barriers to the egalitarian project, mounting popular resistance, and the party’s response to this.

The UK Coalition government introduced a raft of welfare reforms between 2010 and 2015. As part of its response to the financial crisis, reforms were designed to cut public expenditure on social security and enhance work incentives. Policy makers are required by legislation to have due regard to the need to eliminate discrimination, advance equality of opportunity and foster good relations between different people. This Public Sector Equality Duty is an evidence-based duty which requires public authorities to assess the likely effects of policy on vulnerable groups. This chapter explores the extent to which the Department for Work and Pensions adequately assessed the equality impacts of key welfare reforms when policy was being formulated. The chapter focuses on the assessment of the impact of reductions to welfare benefits on individuals with protected characteristics – age, disability, gender reassignment, marriage and civil partnership, pregnancy and maternity, race, religion and belief, sex and sexual orientation – including individual and cumulative impacts. It also considers mitigating actions to offset negative impacts and how the collection of evidence on equality impacts was used when formulating policy. The chapter shows that the impacts of the reforms were only systematically assessed by age and gender, and, where data were available, by disability and ethnicity with no attempt to gauge cumulative impacts. There is also evidence of Equality Impact Assessments finding a disproportionate impact on individuals with protected characteristics where no mitigating action was taken.

This chapter addresses housing policy in England since 2007 and changes in housing opportunities and inequalities. The credit crunch and its aftermath were experienced across the United Kingdom, and speeded the established trend to greater inequality. Many problems identified in England are relevant elsewhere, but the distinctive housing policies adopted in Scotland, Wales and Northern Ireland are not discussed here. The chapter argues that the policy direction adopted since 2010 failed in its ambition to increase housing supply and home ownership and further increased social and spatial inequalities.

Inequalities in English schools stem from numerous factors be they educational, social or economic. Thatcherite policies reshaped the education agenda in the 1980s and inequalities were ignored by successive governments until 1997 when New Labour included social objectives in its approach with measures, such as Education Action Zones and Excellence in Cities. The following Conservative-Liberal Democrat coalition and Conservative governments of David Cameron maintained such objectives through the Pupil Premium and the Universal Infant Free School Meals scheme. Theresa May’s government seems to have adopted a different policy since July 2016, focusing on meritocracy. Methodological obstacles are inherent to studies on the evolution of inequalities at school level and it may be argued that successive Cabinets since 1997 have not implemented structural reforms designed to tackle economic inequalities, thus limiting the effect of their educational reforms.

This chapter addresses inequalities in the United Kingdom through the lens of health inequalities. Driven by inequalities in income and power, health inequalities represent a microcosm of wider debates on inequalities. They also play a role as the more politically unacceptable face of inequalities – where other types of inequality are more blatantly argued as collateral damage of advanced neoliberalism including ‘inevitable’ austerity measures, politicians are more squeamish about discussing health inequalities in these terms.

The chapter starts by depicting health inequalities in Scotland and summarises health policy analyses of the causes of, and solutions to, health inequalities. It then describes the concept of ‘proportionate’ universalism’ and sets this within the context of debates around universal versus targeted welfare provision in times of fiscal austerity.

It then turns to a small empirical case-study which investigates these tensions within the Scottish National Health Service. The study asks those operating at policy and practice levels: how is proportionate universalism understood; and, is it a threat or ballast to universal welfare provision?

Findings are discussed within the political context of welfare retrenchment, and in terms of meso- and micro-practices. We conclude that there are three levels at which proportionate universalism needs to be critiqued as a means of mitigating the impacts of inequalities in the social determinants of health. These are within the political arenas, at a policy and planning level and at the practice level where individual practitioners are enabled or not to practice in ways that might mitigate existing inequalities.

The state has an important role to play in reducing inequalities and a string of legislation from the Equal Pay Act of 1970 to the Equality Act of 2010 requires all companies, institutions and associations, as well as private and public services, to ensure equal treatment in access to employment. Yet political discourse has hardly focused on gender equality until very recently. Mandatory equal pay reporting was promoted as part of the Conservative 2015 election manifesto. Moreover, during David Cameron’s speech to the Conservative Party in October 2015, the Prime Minister claimed that it was impossible to have true opportunity without equality and made explicit reference to the problem of gender inequality. This chapter will thus examine the reasons why there are still high inequalities in terms of pay and prospects for women in Britain and how the 2008 crisis has impacted on women. It will also discuss a range of new policies to tackle gender inequality and consider whether this represents a discursive shift from vague notions of fairness to a decisive commitment from central government to tackle gender inequalities head on.

The reduction in public services since 2008 has undoubtedly affected some groups, such as disabled people, more than others. Many of these cuts, ostensibly imposed in response to recession, bear similarities to measures previously tried and tested on disabled asylum seekers. I argue that the perception of national crisis was used by government as a smokescreen to expand the population affected by such policies, thereby asserting a predetermined neoliberal agenda of public expenditure cuts.

The inequality of this situation is compounded by the entitlements granted to people deemed exceptionally worthy. The Vulnerable Persons Relocation Scheme for Syrian nationals includes disability among the eligibility criteria, offering considerably greater entitlements than available to asylum seekers. If the response to certain people is markedly different to that offered to others, then negative consequences can be anticipated, as from any other example of inequality. Furthermore, this scheme promotes a significant shift in migrant entitlement. The UK government has no legal obligation towards this group; therefore, those people who are selected are recipients of gifts rather than people claiming their rights. I explore the nature and implications of such differences in entitlement, arguing that inequality in all its manifestations must be challenged to reduce deprivation and to avoid negative consequences for the wider population.

This chapter considers young people’s experiences of inequality as being unemployed in a small seaside town in the United Kingdom which has high levels of deprivation. It draws upon qualitative data from a study undertaken with 52 young people aged between 16 and 24, undertaken in 2015, to examine the impact of the economic recession on their lived experiences of seeking work and poverty. All the young people who participated in the study stated that they wanted to work but that there simply were not jobs available for them to do. What work they could find was often poorly paid, temporary and involved travel which they could not afford. The financial sanctions imposed on them by the Job Centre resulted in extreme hardship, hunger and homelessness. Often the young people talked about various forms of crime including drug-dealing and drug-taking as a way of dealing with the consequences of unemployment.

This chapter analyses the attitude of local government to combating ethnic inequalities in Great Britain and France. With cities often seen as the ‘machines of integration’ and the integration of immigrants happening at the local level, this study looks at the everyday practice in London and Paris.

The response of London to the difficulties of mass migration in the 1950s was initially slow and it took major race riots in the 1970s for significant political change to be made. Boroughs such as Lewisham in South East London responded with policies that reflected their local situation including the formation of the first UK Race Equality Council to give the migrant population a political voice. Although this was a small step, its impact can be seen today with 37% of the council’s workforce coming from a black and minority ethnic (BAME) background.

The attitude of Paris and its Arrondissements shows us another kind of strategy. Its districts follow the multicultural strategy adopted by City hall in 2001, organised around three fields of action: anti-discrimination, citizenship and access to rights and valuing cultures of origin, in the context of extremely strict immigration laws. Examples of positive actions include establishing the advisory body of the city council composed of foreigners, the introduction of courses to learn the French language, special cafes for elderly immigrants, local councillors becoming godparents to illegal immigrants or renovation of the residences of immigrants.

This comparison allows us to see the possible differences in dealing with the same phenomenon, as well as identifying the key factors of its success, which in both cities is predominantly due to the political persuasion of city leaders.

Successive devolved governments have been attempting to address inequalities which are deeply rooted in Scotland, by adapting UK policies or by devising their own solutions. In addition, from 2007, Scottish National Party (SNP) governments have criticised the policies conducted at UK level – especially the austerity policies in response to the Recession from 2010. They have demanded further powers to be able to mitigate or reform them, thus adding a constitutional dimension which has been reignited after the referendum on Brexit. This chapter deals with some of the policies aiming at tackling inequalities related to incomes and capabilities in the fields of education and health. It sheds light on the ongoing debates in Scotland and on some of the results which have been achieved under SNP governments.

The National Assembly of Wales has powers in 20 devolved policy areas, including education, economic development, health, housing, social services and local government. Given the social democrat character of the first three elected assemblies in Wales, Wales would appear well placed to interrupt the reproduction of socio-economic disparities. However, Wales is a relatively poor part of the United Kingdom. In this chapter, we consider economic inequality among the Welsh population set within the policy and economic context. Analysis demonstrates how the Welsh labour market has responded to the economic crisis and how this has affected both inequality within Wales and spatial inequality that exist across the United Kingdom. The development of equalities and anti-poverty policy making in Wales and how these have so far been treated separately in policy are examined. The chapter concludes by considering the possibility for the new and distinct policy levers in Wales in relation to the integration of anti-poverty, employment, economic and equality policies that have the potential to address the combined impact of socio-economic inequalities in the future.

The chapter deals with social inequalities in post-conflict and post-2007/2008 financial crisis Northern Ireland. From the late 1970s to the late 1990s, Northern Ireland was characterised by a Catholic/Protestant sectarian conflict and affected by marked political, economic and social discrepancies disadvantaging the Catholic minority.

The combined effects of the economic boom of the late 1990s and early 2000s, and of the signing of the 1998 Good Friday Agreement, improved the social and economic living conditions of Northern Ireland citizens and diversified the ethnic composition of the population, as immigrants were attracted by new opportunities offered in the booming Northern Ireland labour market. The 2007/2008 financial crisis was to curb these positive trends, although Northern Ireland’s economy has now recovered as its unemployment rate indicates.

In the light of this specific context, this chapter first examines key indicators of social inequalities in Northern Ireland: wealth, employment and housing. It then focuses on traditional indicators of Catholic/Protestant inequalities: education employment and housing. It finally examines to what extent the 1998 Good Friday Agreement, the 2006 St Andrew’s Agreement and the 2014 Stormont House Agreement have tackled the issue of social inequalities.