This is a summary of the presentation I intend to make to a Citizens' Assembly this morning:
Talk to the Citizens' Assembly
21 July 2025
Summary
Why has inequality grown, and how can we make sure that the rich make their contribution to society?
Why has inequality grown?
- Let's start with data on UK wealth from the Office for National Statistics:
- The bottom 10% (about 5.4 million adults) had an average wealth of £12,835 in 2022.
- The top 10% had £2.35 million on average.
- The top 1% held over £5 million each on average.
- In total, 58% of UK wealth is owned by the top 20%, and 37% by the top 10%.
- This shows starkly that we have massive wealth inequality in the UK.
- What does that mean in real terms?
- The bottom 10% only have some personal property — no financial security at all.
- The top 10% have over £300,000 in the bank, enough to absorb almost any shock.
- This is the difference between having wealth and being permanently vulnerable.
How did we get here?
- Historically, wealth was accumulated by:
- Enclosing land, claiming it and charging rent.
- Colonising other nations, enslaving people and extracting their resources.
- Exploiting mineral resources without paying for environmental damage.
- Today, extraction continues through:
- Monopolies — water, trains, energy, mobile phones — all protected by the state.
- Banks and tech companies, which dominate markets and extract profit daily.
- Meanwhile, the system is rigged in favour of wealth:
- In my 2024 Taxing Wealth Report, I showed average tax rates by income group.
- The richest pay lower average tax rates on total economic gains (earnings plus wealth increases) than the poorest.
- On new wealth gains from 2011-2019, the richest pay about 4% tax on average.
- This creates a rank tax system that promotes inequality.
- In fact, every taxpayer in the top 10% receives an effective subsidy:
- Through tax relief on pensions, they get nearly £9,000 a year on average, more than maximum Universal Credit or PIP payments.
So, how do we make sure the rich pay?
- Not through a wealth tax, at least not yet. After 42 years in tax, I know:
- Wealth taxes are easily avoided, hugely costly to administer, need immense political capital, and would likely raise only around £10 billion a year.
- We can raise far more, more easily, by fixing the existing system:
- Ending pension tax subsidies for higher-rate taxpayers in the top two income deciles could raise £14 billion.
- Charging the equivalent of National Insurance on investment income over £5,000 a year could raise £18 billion.
- Applying VAT to banking services (mostly used by the wealthy) could raise £8 billion.
- The real key is to close all the loopholes, anomalies, allowances and low tax rates that currently let the wealthy dodge tax.
- Only when that is done should we even consider a wealth tax — and we are nowhere near that yet.
In summary
- Inequality has grown because wealth is heavily concentrated and protected by systems of extraction, monopolies, and tax privileges.
- The wealthy pay less tax on their rising wealth than ordinary people pay on their earnings.
- We can make them pay more by reforming existing taxes:
- Scrapping pension tax subsidies for the rich, taxing investment income like work, and making banks pay VAT.
- That's a fairer, simpler way to make the rich contribute, without the pitfalls of a premature wealth tax.
I look forward to your questions.
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Short, sharp & to the point
It seems though that politicians are terrified of doing this, because these people are very vocal and seem to buy influence by funding political parties etc.
Somehow we need to get the message out better. I’m tired of being told there is no money and being totally dismissed when you suggest the rich could pay more. Gary Stevenson says a lot I agree with, but he’s not reaching those he really needs to reach. Maybe you need a media strategy like Led by Donkeys, or a brave stunt like the wonderful guy playing ‘Things can only get better’ while Sunak stood in the rain to announce he was calling the rain. That reminded me that no matter how bad our politics is, we still have our British sense of humour. You pension tax relief on higher earners suggestion is a great one. They don’t need it and their is a clear argument for fairness that all is at the lower rate.
Yet again you fail to mention that age is the main determinant of wealth as you would expect somebody working 40-50yrs has saved a considerable amount over the years particularly through a pension and paying off a mortgage and becoming a property owner. You also say £300,000 is more than enough to cover any “shocks”. Well £300,000 would buy an inflation linked annuity of about £12,000 pa for someone retiring at 65. I wouldn’t say this makes them at all wealthy would you? A highly disingenuous presentation is my opinion. It might be fine for an audience who want to “bash the rich” but it just isn’t balanced.
1) You are obviously an expert in the bleeding obvious re age
2) why did you ignore pension fund balances that are actually used to buy annuities?
You really are very stupid. Misquoting is clearly the only skill you have
You’re numbers don’t make any account whatsoever of the age of people – you’d certainly expect people who are very young to have little or no savings and you’d certainly expect those approaching retirement to have high levels of savings, ready to turn that into an income to live off.
So the numbers in isolation are meaningless without this adjustment – how do things change when you adjust for these (obvious) factors?
Of course my figures take account of age.
They reflect reality – and that people are of all ages.
But you totally ignore (deliberately, and callously, no doubt) that if younger peiople licve with profound insecurity that is reflected in how they can provide for their children, whoi are out future. We could very easily address tat insecurity be redistributing wealth, financial and otherwise. Why woudn’t you want to do that?
These people who have zero wealth – what is the value of the benefits they receive, not available to other people?
Where does that fit into your inequality analysis?
Or are you just looking at gross inequality and ignoring everything that this country does to support those at the bottom of the income/wealth spectrum? If so, that’s a pretty meaningless comparison, isn’t it?
They get many fewer beenfits than the wealthy.
Why do you hate them so much?
And how come you aere also Steph Powers? Do you havce an identity issue?
Saved a considerable amount, really?
We have been working over 25 yrs, and literally just started saving a very tiny amount (I suspect ‘pocket money to you). We are both professionals, my partner being in a reasonably senior NHS role.
We have a very modest house, new xars are by business provision only.
£300,000 saving is an absolute pipe dream, we don’t even have a tenth of that, and never will.
We consider ourselves far better off than most, even with our last family holiday abroad being 15 yrs ago, and if financially broke us.
You need a serious reality check..
“Yet again you fail to mention that age is the main determinant of wealth as you would expect somebody working 40-50yrs has saved a considerable amount over the years particularly through a pension and paying off a mortgage and becoming a property owner. ”
Including, of course, all those on minimum wage jobs or state benefits, who have not enough money to live on, let alone save, and could never afford to buy a house. Those people get old as well, still living in rented accommodation and still struggling to make ends meet. Presumably, to you, they are not people?
Excellent – may the ripples spread far and wide! Especially to all those on the left using the term “wealth tax”, and to all MPs.
🙂
Agree clarity is key.
The system isn’t fair, or functional.
Fair Taxation?
Or something else?
Spending comes before taxtion
Inequality is magnified when geographic and ethnic distributions are considered. In wealth terms the South East and the North East are different countries. The North East has significant deprivation and little wealth to tax.
The distinction you make between a wealth tax and taxing wealth is really important and not generally understood – perhaps because most people don’t relate to the asset mix of the most wealthy.
I’d prefer the language of ‘wealth redistribution’ were used, it’s the redistribution of wealth that is needed, no simply an increase in tax raised.
Hope today is valuable, and the return journey is to timetable.
So fr, it is going very well
I talk about wealth redistribution for the reasons you note.
Believe or not, there was an argument in government once that home ownership (that was also used to justify RTB and a – ahem – mixed tenure sector) – mingled with renting tenures would actually help make inequality figures better – I kid you not.
The dark side of home ownership – that is its liabilities – maintenance, debt – have for some time been going down hill and overlooked. My local authority has first dibs on RTB properties being sold on the market for the first time. I have lost count of how many that come back to us that are badly maintained where the new owner (ex-tenant) did not have the income to reinvest in the unit lost to the Council. So, we’d do them up at a cost to the HRA (housing revenue account) and watch the next tenant qualify for their RTB and walk off with a big discount on a re-furbished home lost to the private sector forever.. What a system.
Still, politicians refuse to see the facts – achieving homeownership is now unaffordable, but so probably is keeping one when you’ve got one. They’re expensive to look after for goodness sake. Crap wages, pensions and meagre benefits will not create a nation of homeowners, nor will poor regulation.
Like other privatisations, RTB has instead created a nation of landlords living off rents, along landlord banks, landlord DIY supermarkets because capitalism has done what it always does when set free – it eats itself, it cannot stop.
Thanks and much to agree with
Sara Preston/Steph Powers (?) asks about the value of the benefits received by those with zero wealth, and claims that such benefits are “not available to anyone else”.
1. The benefits paid to the poor are all immediately ploughed back into the economy, to pay rent, buy clothes and food, pay energy bills, and even pay consumption taxes like VAT and fuel duty. They are NEEDED. They get spent. In otherwords the money works hard and is redistributed to others.
2. When far greater sums are paid to subsidise the wealthy, via tax breaks and incentives, because they don’t need that money (they are wealthy remember), it tends to disappear out of circulation into their already excessive savings. It is such “lazy” money, it does no work for anyone else, it is so inanimate it might as well be dead.
To put it simply, money given to the poor works hard (like the poor).
Money given to the rich is lazy, it doesn’t work (like the very rich), it just goes to sleep in their savings. It is never seen again. No one else benefits.
So why give even more money to the rich? It’s wasteful and immoral.
Thanks
Appreciated
I’ll play devil’s advocate here, or Reform/Conservatives as I like to call them and put some common things that will come up.
There’s always been inequality to some degree, it hasn’t got any worse!
They aren’t all monopolies, I can freely change my mobile, broadband, energy provider and tech companies just provide a better service than the alternative.
Those wealthy people own the businesses that employ people, without them we wouldn’t have people employed so they need all that to funnel money into businesses.
I came from a poor background, my parents had almost nothing but I worked hard, saved, didn’t go on holidays and eventually managed to buy a house. I got promotions based on merit and contributed to the pension and paid my taxes every year without taking anything out. They’re only poor because they are work shy, except those with disabilities, but even then having low mood now counts as a disability.
Now excuse me while I lobotomise myself to bring myself up to a higher intelligence after writing that drivel.
None of that did come up.
To that extent, this may not have been representative.
Glad to hear it!
I believe that laypersons really need a story (narrative, as they say in the trade) to explain how they/we got here.
In that regard an economic timeline from post WW2, say, to today starting with the intensive productive (Keynesian) economics of rebuilding postwar feeding into a consumer society could have set the scene for your audience. Then onto the monetarism era advanced by Milton Friedman and neoclassical economic acolytes as capital strove to discipline workers from the earlier 1970s feeding into Thatcher’s expanding neoliberal TINA period of “greed is good”. This began an ongoing austerity for the bottom and privatising of the commons for rent extraction by capital at the top. Once the captive politicians and the masses had been propagandised in their thinking, the wealthy and their co-opted PMC have driven the financialisation of everything till we arrive at the Technofeudal era of the today’s Robber Barons.
I think folks who’ve lived through at least some of those times can then better see what you presented, as per your above Summary, fits into that story.
Unfortunately, I was severely time constrained so mo such thing was possible.
Your figures don’t support your claim that inequality has increased.
What does the gini coefficient show? What do the net (after benefits) rather than gross figures show?
You don’t appear to be comparing the right metrics so your conclusion is flawed.
If you believe the Gini is reliable you chosen name is appropriate.
It cannot measure the issues I am concerned with. You obviously do not know that. I suggest you do that.
Thanks for a concise and punchy analysis. I note you didn’t include some of the more modern takes on ‘enclosure ‘ where public assets are sold off on the cheap and snapped up by private capital- right to buy, school playing fields and public utilities exploited for debt. Until the power of raw wealth is checked the situation will only continue, with money increasingly concentrated in the hands of a few. Gains made simply by holding capital need to be taxed efficiently. More importantly I believe we need to find better ways to reward people who invest in economically productive vehicles, rather than in land and property that don’t actually generate ‘wealth’ in any real sense
I had only a few minutes.