SOCIETY: Britain `massively' more unequal than 20 years ago

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The Independent Online
The UK has become "massively" more unequal than it was 20 years ago, with the income of the richest tenth of the population equal to that of the entire bottom half of the income distribution. One in five people lives in poverty.

A comprehensive new study of inequality concludes that the chances of a reversal in this trend are slim. Paul Johnson, one of the co-authors of the new book and deputy director of the Institute for Fiscal Studies, said: "The increase in inequality is probably the biggest social change that we have experienced in the past 20 years. This change, with all its consequences, is here to stay.,"

Adjusting for family size and type, the poorest 10 per cent of the population had an after-tax income of pounds 110 a week (pounds 5,720 a year) or less, in 1995 pounds. This included people on Income Support and pensioners with just the basic state pension.

The average was pounds 267 a week. The adjustment for the number of family members and dependants means that a single person with an income of pounds 267 would actually be well above the average, while a couple with a child on the same income would be well below average.

At the other end of the scale, the top 10 per cent had pounds 455 a week (pounds 23,600 a year) or more after tax. That would correspond to a single earner on pounds 22,000 a year after tax or a one-earner family with children making pounds 50,000. A mere 1.6 million people in the UK made adjusted net incomes above pounds 700 a week.

Inequality in the UK, Alissa Goodman, Paul Johnson and Steven Webb, Oxford University Press, pounds 15.99.