A power divide underpins the UK wealth divide


A jar of sterling coins is tipped on its side with the coins spilling out on to a wooden surface. The jar denotes a savings pot.

If the government still thinks reducing the highest rate of income tax and allowing huge companies and their top dogs to arrange their finances to avoid paying large chunks of tax money are good idea, it should have a look at the latest figures on wealth distribution.

The Office of National Statistics (ONS) has released household wealth figures that show the richest 1% in the country have accumulated as much wealth as the poorest 55% of the UK population.

The stark contrast reveals two very different sides to Britain and, unsettlingly, this divide is getting bigger, with the rich getting richer and the poor getting poorer. This is fine if you're on the rich side of the division but not so great if you happen to be on the poor side.

Britain's wealth is being concentrated down into fewer and fewer hands, and as that pool shrinks, the people holding the money become more and more powerful. As we all know there is a clear correlation between money and power.

So it's no surprise that the rich are getting richer if they're calling the shots about how they, and their companies, are taxed.

This the reason we have seen the 50% income tax rate cut to 45% while more people are dragged into the 40% income tax band. It's also why we've seen the welfare budget slashed quickly and harshly but little action around the avoidance of corporation tax by some of the world's biggest, and most profitable, brands.

We are constantly reminded of benefits scroungers and those who don't pay into the system but take more than they should. However, we are not made aware that although this country pays out £1.2 billion a year to fraudulent benefits claimants, tax evasion costs between £70 billion and £120 billion depending on whose estimates you believe. If tax evasion equates to 10 times the cost of benefit fraud, why the focus on the latter? Because it's easier to blame people who can't stand up for themselves than to tackle the real problems.

The ONS figures show that at the heart of our inequality in the UK is it is easier to keep taking from those who have very little to start with – it is not just an inequality of wealth we are struggling with but an inequality of power.