An increasingly unequal country where people are definitely not 'all in this together'

Income inequality has risen faster in Britain than in any other rich nation since the mid-1970s, according to a report by the OECD. 

The think-tank says the gap has come about due to the rise of a financial services concentrating wealth into the hands of a tiny minority and has warned about the rise of the top 1% in rich societies and the falling share of income going to poorer people.

This trend is especially pronounced in Britain*, where the dramatic rise in inequality has been fuelled by the creation of a super-rich class. The share of the top 1% of income earners increased from 7.1% in 1970 to 14.3% in 2005.

Just prior to the global recession, the OECD says the very top of British society – the 0.1% of highest earners – accounted for a remarkable 5% of total pre-tax income, a level of wealth hoarding not seen since the second world war.

At the same time as accumulating great wealth, the rich have seen tax rates fall. The top marginal income tax rate dropped from 60% in the 1980s to 40% in the 2000s, before its recent increase to 50% (which the current Tory leadership is trying hard to scrap).

Cameron is also going to the EU Summit with the sole aim of 'protecting' his 'friends' in the City ... the people who helped to bankrupt our nation, who are still not lending to small business, and who are now busy speculating on commodities/currencies and trying to bankrupt the nations (and taxpayers) who bailed them out!

* The OECD report re-enforces previous reports of FTSE100 executives receiving 50% pay rises (on already multi-million pay packages), whilst the vast majority of hard-working people are facing pay freezes/cuts and/or redundancy.

Taxes about to rise sharply

Taxes must rise sharply over the next decade to bring down borrowing, according to the National Institute of Economic and Social Research (NIESR).  In a report, the think tank said taxes would have to rise by the equivalent of 6p on the basic income tax rate to get the budget deficit below 3% by 2020.

It also said the UK economy faces sluggish growth and rising unemployment this year. The BBC's Nils Blythe said that although the large additional tax rises needed to get the budget deficit below 3% by 2020 would not necessarily come in the form of income tax increases, the think tank reasoned that the scale of the rise is equivalent to putting up the basic rate of income tax from 20p to 26p in the pound.

"Only with that type of increase will the national debt eventually fall below the 40% of national income that before the financial crisis was regarded as a prudent level," he said.  The think tank also said cuts to public spending, which will be necessary for cutting the size of the budget deficit, will push growth lower than it otherwise would have been.  

More reality/truth is slowing filtering out ... just not from the Government.