Page last updated at 15:20 GMT, Wednesday, 27 January 2010

Rich-poor divide 'wider than 40 years ago'

Council flats near Whitechapel in London
Neighbourhood renewal policy action is needed, according to the report

The gap between rich and poor in the UK is wider now than 40 years ago, a government-commissioned report says.

"Deep-seated and systemic differences" remain between men and women and minority groups in pay and employment, the National Equality Panel found.

It said in areas such as neighbourhood renewal, taxes and education, policy action was needed to limit inequality.

The issues raised would need "sustained and focused action", Equalities Minister Harriet Harman said.

"But for the sake of the right of every individual to reach their full potential, for the sake of a strong and meritocratic economy and to achieve a peaceful and cohesive society, that is the challenge that must be met," she added.

Earning power

Apparent discrimination against people from ethnic minorities was revealed in the report, with those from nearly every minority group less likely to be in paid work than white British men and women.

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The panel - set up by the government in 2008 - found that despite women up to the age of 44 having better qualifications than men, men were still paid up to 21% more per hour.

But the authors pointed out that some of the greatest differences come within social groups.

Among women, many work part-time, earning less than £7.20 an hour, much less than the median pay of £9.90 across the country.

KEY POINTS FROM INEQUALITY REPORT
Graphic showing gender pay gap and net income
Top 10% of population are worth more than £853,000
Bottom 1% have negative wealth (liabilities exceed assets) of £3,840 plus
Every extra £100 a month in family income, put a child a month ahead of typical development aged five
Bangladeshi and Pakistani children four months behind white children's development aged five

"Most political parties and people subscribe to the ideal of 'equality of opportunity'," panel chair Professor John Hills, of the London School of Economics, told the BBC.

"The challenge that our report puts down to all political parties is how do you create a level playing field when there are such large differences between the resources that different people have available to them.

Home Office minister Phil Woolas discusses the report on the BBC's Daily Politics

"Things that allow you to buy a house in the catchment area of a good school or allow you to help your children get on the housing ladder. These are very big differences."

The study said that the type of job and pay a parent had could have a cumulative effect throughout a person's life, setting them on "tracks that make all sorts of differences".

By retirement, the difference between rich and poor can be "colossal", the report added.

The panel pointed out that half of those who have worked in the top professions have net assets worth more than £900,000, while a 10th of those who have had unskilled jobs have property, savings and possessions worth less than £8,000.

BBC social policy correspondent Gillian Hargreaves said the report would make "awkward reading for the government" as Labour had made tackling inequality a priority.

Gender pay gap graph

Theresa May, shadow minister for women and equalities, told the BBC that Labour's policies had failed.

"It is shocking that after 13 years of a government that wanted to focus on child inequality, we're still in this situation," she said.

"Labour has had a one-dimensional approach, looking at the symptoms, not the causes. For example, one in six children are growing up in a workless household. We need policies that can make equality a reality."

The Liberal Democrats' children, schools and families spokesman, David Laws, said Gordon Brown's government had "run out of ideas for tackling the lack of opportunity for so many children and the chasm that separates the rich from the poor".



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FROM OTHER NEWS SITES
This is Money Where do you fit among the rich and poor? - 2 hrs ago
Guardian.co.uk Pass notes No 2,719: The super-rich - 5 hrs ago
The Independent Leading article: Only policies, not posturing, will bring down inequality - 6 hrs ago
The News International Britain's wealth gap widest for 40 years - 9 hrs ago
Irish Times Report highlights UK inequalities - 14 hrs ago



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