Income and Wealth Inequality

Lord Stern of Brentford Excerpts

Wednesday 26th November 2014 Lords Chamber

[Lord Newby]

I am not sure that I do recollect altogether. It is important to look at inequalities as well as differences because there is an additional dimension in the word “inequality” to the neutral word “difference”.

[Lord Stern of Brentford (CB)]

My Lords, will the noble Lord, who is my former student and was a very good student, join me in recognising that after three or four decades of being roughly constant, income inequality in the UK shot up during the 1980s, and the Gini coefficient went from around 0.25 to about 0.35 in household disposable income and has stayed there through different Administrations over the last 20 years? We moved from being one of the more equal countries to one of the more unequal countries in the OECD. Does he recognise also that the share of gross income of the top 1% has more than doubled in the last 30 years, moving from around 6% to around 13%? Are he and the Government comfortable with those levels of inequality?

[Lord Newby]

My Lords, I cannot but agree with my former tutor. I fear that I did not hear the last part of his question altogether, but it is very important, first, that we shine a greater light on the amount that people have been earning at the top end so that they can be subject to appropriate scrutiny, and, secondly, that people at the top end are taxed more effectively than they have sometimes been in the past. In both those respects, the Government have made some progress.