Like most talk of closing the “north-south divide” and “levelling up” Britain’s economy, that of the government clouds far more about geographical inequality than it illuminates. It’s not hard to agree that the nation’s massive dependence on London’s capacity for generating wealth and taxes is undesirable, but altering that will take something more clever and more honest than just doing the capital down. And if large inequalities within regions as well as those between them are overlooked, where does that leave the poorest in parts of the country that, by some very general measures, are rich?
David Phillips of the Institute for Fiscal Studies – hallowed be its name – has addressed these under-recognised complexities in the 17 minute talk looking ahead to next month’s first budget since the general election embedded below. He looks at regional differences in productivity, income and wealth but also probes the variations average figures can conceal, and he considers the big impacts of various forms of housing cost in London, pointing out that, when these are allowed for, median household income in London is no higher than the national average.
He also shows that although Londoners are 50 per cent more likely than people elsewhere to be in the top 10 per cent income bracket (after housing costs), they are also 25 per cent more likely to be in the poorest one. It’s a hugely helpful presentation. Watch it all.
Photograph by Omar Jan.
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