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Recession? What Recession? UK's richest keep getting richer

by LLB Editor
11th Feb 13 11:52 am

Britain’s super rich keep getting richer and the poor keep getting poorer, according to a report published by thinktank Resolution Foundation.

The study shows that the wealth gap in the UK has expanded considerably since the 1990s with the top 1% earners seeing their wealth increase from 7% to 10%. The bottom half, on the other hand, has seen its wealth drop from 19% to 18% in the past 15 years.

Reducing the gap between in the rich and the poor is high on politicians’ priority list. While Labour leader Ed Miliband has called for a policy of “pre-distribution” to try to narrow the gap,  London mayor Boris Johnson backs the idea of employers promising to pay the Living Wage of £8.55 an hour.

The report also found that while the top 1% earn 10p in every pound of the total income of Britain, the poor pocketed only 18p of every pound earned between them.

Matthew Whittaker, senior economist at the thinktank, said: “If we take the longer view, we see the very wealthiest have continued to prosper while many others have not.

“The growing gap in incomes is pronounced when you look at the top 10th of households, and overwhelming when you consider the position of the top 1%. The rest of society hasn’t kept up. It’s the squeezed majority, not just the squeezed middle.”

The report shows that the top earners saw their wealth dip between 2009 and 2011. This is because the wealthy chose to “bring their earnings forward” to benefit from 45p tax Chancellor George Osborne is bringing by April this year.

The report also revealed that mothers’ pay in the UK has risen between two and three times faster than that of fathers. While mothers boosted their earnings by 26% between 1997 and 2008, fathers saw just an 8% rise in salaries.

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