He was accused of delivering a party political broadcast instead of an Easter message by one minister as Tory MPs and Cabinet ministers rejected his analysis as 'out of date'.
In his sermon at Canterbury Cathedral, Dr Carey said: 'Deep social divisions are becoming more entrenched in our society. There are anxieties that mass long-term unemployment is here to stay. There are areas where many families have known no stable employment for generations.'
He added: 'Nor can we ignore the shameful widening of the gap between the least well off people in our society and the rest. It seems that the income of the poorest tenth of the population may have declined by 14 per cent since 1979, while that of the majority has gone up by well over 30 per cent. A very substantial minority are cut off from a reasonable share of opportunities, hope, status, and prosperity.'
Christians could 'never rest content with such a state of affairs,' Dr Carey said.
Ann Widdecombe, the Under-Secretary of State for Employment, who converted to Roman Catholicism in protest at the ordination of women, said his statistics were wrong, and the 'snap shot' he presented was misleading. 'I am grateful I was in Westminster Cathedral hearing the Easter message instead of at Canterbury hearing a party political broadcast,' said Ms Widdecombe.
The Archbishop's message, echoing remarks in February about poverty, reactivated the tensions between the Church and State which marked the Thatcher era, and which John Major's more 'caring Conservativism' style of leadership had appeared to end.
Dr Carey said the reform of the Sunday trading laws, which the Bishops unsuccessfully opposed in the House of Lords last week, 'was a sign of the continuing secularisation and commercialisation of our country. This makes the Easter message more relevant than ever because it is a call for the transformation of society.'
Defending the Government, Gillian Shephard, the former Secretary of State for Employment, said the nature of employment and people's perception of poverty had changed over the past decade.
'I don't criticise the Archbishop. He must say these things but he must be up to date,' said Mrs Shephard, now Minister of Agriculture.
'While there undoubtedly has been a growth in the people who are long-term unemployed, there has been an immense amount of effort to get young people into jobs through Training and Enterprise Councils.
'The working population has changed completely. People are going in and out of employment in a way they didn't expect. Expectations have also changed. Poverty has been redefined in terms of having things which 25 years ago they would have been astonished to have.'
Being without a car if you live in the city does not mean you are poor, she said, adding: 'Not having prospects is poverty, but far more are going into training.'
Labour said the poverty highlighted by the Archbishop would be exacerbated by tax rises in the Budget, which begin to bite this week. Harriet Harman, the shadow Chief Secretary to the Treasury, said that about 300,000 single parents who worked would suffer cuts in their tax
John Watts, Tory chairman of the cross- party Commons Select Committee on Treasury Affairs, said: 'It would be far better if he concentrated on giving a moral lead.
' I suggest that His Grace looks again at the unemployment figures and sees in this country they are falling, whereas in Europe they are rising.
'He seems to think you make the poor better off by making rich poorer. He should re-read the parable of the labourers in the vineyard and the parable of the talents.'
David Shaw, a vice-chairman of the Tory backbench finance committee, said: 'He has got to recognise that people at the bottom have more cars than they
did in 1979, more central heating, more telephones.
'The question is how fast we go on improving their standard of living. The answer is to cut taxes, and not to keep raising the cost of the public sector, which increases unemployment.'
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