Transcript The Cause of Wealth Inequalities in the UK

The Cause of Wealth
Inequalities in the UK
Government Policy - Taxation
Progressive Taxation
This type of taxation basically means the more you
earn the more you pay in tax (it progresses).
Income tax is an example of progressive taxation – the
higher earners make more of a contribution through
taxation.
Look at the worked example on textbook Page 13 (UK
Social Issues)
Regressive Taxation
This works differently to Progressive Taxation
in that the more you earn, the less you pay as
a proportion of your wage. Therefore, the rich
benefit from this. VAT (currently 20%) is a
standard rate and doesn’t rise or fall
depending on your income so, for example,
VAT at 20% on a car costing £10,000 will
impact more on the income of someone
earning £15,000 compared to someone
earning £40,000.
Benefit Policy - Welfare
Benefit levels are a political decision and
fluctuate depending on who is in power and
take into account increases in earnings and
the rate of inflation. However, they typically
fall below these levels.
Critics of the benefit system in the UK claim it
tries to camouflage statistics by moving
people from unemployment benefit to longterm disability benefits.
See Next Slide
Many elderly people are confused by the complicated
Welfare System or reluctant to provide details worried
that they may end up worse off.
Unemployment
The unemployment rate for 16- to 24-year-olds rose sharply in 2009, from
15% in 2008 to 19% in 2009. However, the rate had already been
rising for a number of years before the recent recession, from 12% in
2004 to 15% in 2008.
Clearly the recession has had a huge impact on unemployment levels.
Overall unemployment levels are around 7% currently.
The industries hit hardest by the recession are those typically filled by
those in the lower classes eg manufacturing, retail and administration.
However, the Government also has an impact on unemployment as they
can offer incentives for companies to set up factories. They can also
close hospitals and services in one area creating unemployment and
spending money in other areas therefore creating employment.
Education
There’s clearly a link between qualifications and
income.
See Next Slide
Age
• 2/5 of unemployed 50+ workers have been unemployed for more
than a year. This has increased by 52% in the last year.
• Unemployment among 50+ women has increased by 1/3 in the last
3 months..
• http://www.ageuk.org.uk/latest-press/50-plus-workers-trapped-inlong-term-unemployment/
http://www.statistics.gov.uk/pdfdir/ashe1109.pdf
Low Pay
http://www.statistics.gov.uk/pdfdir/ashe1109.pdf
Social Exclusion
Employment rates of disadvantaged groups, UK, Oct-Dec 2009
Who you are
Gender
Just how important is this in
terms of income inequalities?
Women More Likely to be Lone Parents
The number of people living in lone parent
households has quadrupled.
Gender: Lone Parenthood
Fewer Women are in
Employment
Gender: Lower Pay
Gender: Part-Time Work
Gender Pay Differences By Region
Job Types
The further up the employment sector, the more
it’s likely to be dominated by men.
http://www.statistics.gov.uk/downloads/theme_social/Social-Trends40/ST40_2010_FINAL.pdf
Does Education Help?
Why is feamle success at school not reflected in
employment and income?
Gender: Longevity
Women tend to live longer than men so whilst
they are more likely to have a lower income
and less wealth than men, they are going to
experience this for a longer period of time.
Life Expectancy in the UK (2010): Men (78)
and Women (82)
Glass Ceiling or Reinforced
Concrete Ceiling?
The Glass Ceiling refers to the situation where an
individual’s progress within an organisation is
halted due to some form of discrimination.
This is most commonly related to the lack of
progress made by women.
‘Reinforced Concrete Ceiling’ is a reasonably new
term that suggests it has become even more
difficult for women to push into the hierarchy of
significant organisations.
Race
These statistics are taken from the 2001
Census so are no longer accurate.
Population Size
7.9% from a minority ethnic group
ETHNIC MINORITIES ARE SET TO MAKE UP A FIFTH OF THE UK POPULATION IN 40
YEARS, A UNIVERSITY OF LEEDS STUDY PREDICTS.
IT SAYS THE PROPORTION OF BLACK, ASIAN AND OTHER ETHNIC MINORITIES
WILL RISE FROM 8% OF THE POPULATION, AS RECORDED IN THE 2001
CENSUS, TO 20% BY 2051.
RESEARCHERS SAY THE POPULATION WILL REACH NEARLY 78 MILLION - UP
FROM 59 MILLION IN 2001.
ONE OF THE AUTHORS, PROFESSOR PHILIP REES, SAID THE UK'S ETHNIC MAKEUP WAS "EVOLVING SIGNIFICANTLY".
HE SAID: "GROUPS OUTSIDE THE WHITE BRITISH MAJORITY ARE INCREASING IN
SIZE AND SHARE, NOT JUST IN THE AREAS OF INITIAL MIGRATION, BUT
THROUGHOUT THE COUNTRY, AND OUR PROJECTIONS SUGGEST THAT THIS
TREND IS SET TO CONTINUE THROUGH TO 2051.
http://www.bbc.co.uk/news/10607480
Economic Migrant
Asylum Seeker
Race: Risk of Poverty
Ethnic Minorities are far more likely to live in
low-income households than White people.
This is also reflected in terms of the
structure of the family unit.
Pakistanis and Bangladeshis are significantly
worse off, even compared to other ethnic
minority groups.
What factors contribute to
this?
Race: Culture
Within some groups, it’s quite typical for one
parent to work, therefore the household
income decreases significantly.
Women, culturally, are quite often seen to be
more effective as carers than earners.
Race: Education
Ethnic minorities tend to live in or around London and certain
other pockets of the UK. Inner city living is common.
This may have an impact on schooling as the schools they
attend are more likely to be lower down the School League
Table.
However, it could be cultural as some groups do far better
than others. Could it be culturally acceptable to fail?
Race: Discrimination
Direct - *$@!!!
Indirect
Institutional
Islamophobia
Geography: Where you live
There are references to a North/South Divide in terms
of health and wealth. Scotland, the North of England,
Wales and Northern Ireland, generally speaking having
more in common in terms of the above, compared to
the South of England. However, there is evidence that
the gap may not be as significant as it has been in the
past.
Whilst, it’s important that you are aware of regional
variations in terms of wealth (and later, health) be
careful not to generalise. The following demonstrates
that within regions and even towns there can be
significant differences.
What conclusion(s) can be drawn
from this?
Areas that would be considered more ‘working class’ in
their characteristics clearly outweigh others.
However, it’s vital that you don’t generalise whole
regions in terms of income inequalities because that
doesn’t paint an accurate picture. A few hundred metres
in distance can make a huge difference.
% of working age population in receipt of out of work benefits:
•Camelon – 28%
•Larbert – 9.5%
•Polmont – 6.1%
% of 60+ who are in receipt of pension credit:
•Camelon – 26.2%
•Larbert - 11.3%
•Polmont – 9.8%