Poverty Alliance calls on UK Government to immediately end the benefits freeze, and for the Scottish Government to bring forward the promised income supplement
- Oxfam report on world inequality found that the global super-rich are hiding $7.6 trillion from tax authorities
- The UK-based charity has urged national governments to raise taxes on the wealthy and increase investment in public services
- In 2018, billionaires increased their wealth by $900 billion, while the 3.8 billion people constituting the poorest half saw their wealth decline by 11 per cent
- Patrick Harvie says: “The powers needed to tackle problems like tax avoidance lie at Westminster”
THE INJUSTICE and suffering inflicted by growing disparities in the distribution of wealth have been thrown into sharp relief by the publication of Oxfam International’s annual report on global inequality, which has provoked demands for both the UK and Scottish Governments to take action.
Released today [21 January] ahead of the beginning of the World Economic Forum in Davos, Switzerland tomorrow, the UK-based charity’s report shows that global inequality is on the rise.
In the decade since the generation-defining 2008 financial crisis, Oxfam’s analysts have reported that the number of billionaires In the world has nearly doubled, with the billionaire class now in control of more wealth than ever before, increasing their riches by $900 billion last year alone – the equivalent of accruing $2.5 billion per day.
The wealth of the world has also become even more concentrated, with 26 individuals now worth as much financially as the 3.8 billion who constitute the Earth’s poorest 50 per cent of people.
"Governments must now deliver real change by ensuring corporations and wealthy individuals pay their fair share of tax.” Oxfam executive director Winnie Byanyima
The situation has been facilitated, Oxfam notes, by the fact that international plutocracy has delivered some of the lowest rates of taxation in decades – a situation which extends to the corporations owned by the super-rich. Only 4 cents in every dollar of tax revenue comes from taxes on wealth.
Furthermore, as the world’s super-rich have become richer, economic hardship has increased among the poor, with 3.4 billion – almost half of the human population – living on less than $5.50 per day.
Illustrating the benefits that increased taxation of wealth could potentially deliver, the report also argues that getting the richest 1 per cent of the global population to pay 0.5 per cent extra in tax on the wealth would raise more money than it would cost to a) educate all the 262 million children currently out of school, and b) provide healthcare that would save the lives of an estimated 3.3 million people.
Oxfam executive director Winnie Byanyima commented on the report’s findings by emphasising the growing international discontent with the economic status quo, warning: "People across the globe are angry and frustrated.
"Governments must now deliver real change by ensuring corporations and wealthy individuals pay their fair share of tax."
Responding to the report, Poverty Alliance policy and parliamentary officer Neil Cowan told CommonSpace: “This report highlights the unacceptable levels of inequality in the world today. We need to redesign our economies so that they work for everyone.
“The UK and Scottish Governments have a moral responsibility to narrow the gap between those who have most and those who have least. As well as introducing a more just taxation system that targets equality there are immediate actions we can take to loosen the grip of poverty on people’s lives. The UK Government should immediately end the benefits freeze and the Scottish Government should bring forward the promised income supplement, because families living in poverty now can’t wait until 2022.”
Russell Gunson, Director of IPPR Scotland, also told CommonSpace: “Today’s report on global inequality is a really welcome contribution to the crucial conversation about how we create changes that deliver prosperity and economic justice. Wealth inequalities are bigger than income inequalities and so we can’t aim to make Scotland or the UK fairer unless we look at how we can share wealth more fairly too.
“Oxfam are right to state that poverty is a political choice – the UK Government and the Scottish Government have the opportunity to take bold and decisive action to show the rest of the world that it is possible to create a different kind of economy. We should take an urgent look at how our tax and spending in Scotland can contribute to narrowing income and wealth inequalities and deliver the inclusive economy we need to see.”
Scottish Labour leader Richard Leonard commented: "This report lays out the staggering inequalities that exist in our society.
"We have an economy that does not reward hard work but instead rewards inherited wealth. When just 26 people own as much wealth as half the planet, it's time for change.
"That is why Labour governments at Holyrood and Westminster will tackle wealth as well as income inequality, not only to redistribute income but to redistribute power as well.
"We need to invest in public services and build a much more equal society. That is why I am personally committed to reforms of how we tax earned versus unearned income, and how we tax capital gain versus the weekly wage.”
Speaking to CommonSpace, the Scottish Greens co-convener and finance spokesperson Patrick Harvie MSP said: “Oxfam’s report demonstrates the staggering inequality that exists within the UK, and worldwide.
“While it is right that the Scottish Parliament utilises all the powers at its disposal to raise funds and tackle inequality, the powers needed to tackle problems like tax avoidance lie at Westminster. Since the UK Government is run by the party of millionaires, we’re unlikely to see them use these powers to redistribute wealth anytime soon.
“In last year’s Scottish budget negotiations Greens used our influence to ensure that fairer income tax rates and bands were put in place. But the combined effect of direct and indirect taxes is that the bottom 20 per cent of earners still pay a higher proportion of their incomes than the top 20 per cent.
“This is largely due to the unfair and outdated council tax, which is why we have put local tax reform at the centre of budget negotiations this year. We will continue to push for fairer property and land taxes so we can go even further in sharing Scotland’s wealth.”
“Under the UK Government’s austerity programme and welfare cuts, money is being taken from the pockets of low income families, pushing them into crisis, debt and poverty.” Scottish Government spokesperson
A Scottish Government spokesperson told CommonSpace: “We fully agree with the concerns raised by Oxfam regarding the increased gap between the world’s richest and poorest. That is why tackling inequalities will never be an optional extra for this government – making Scotland a fairer, more equal country is core to everything we do. Internationally, we’re determined to be a good global citizen and play our part in tackling the challenges of poverty, injustice and inequality.
“Under the UK Government’s austerity programme and welfare cuts, money is being taken from the pockets of low income families, pushing them into crisis, debt and poverty. We are investing more than £127 million in 2018/19 to try and mitigate that, and provide vital support for low income households – something we will continue to do in the next year.
“Scotland is the only part of the UK with targets to tackle child poverty, and we continue our drive to create a fairer country through our Fairer Scotland Action Plan. The Tackling Child Poverty Delivery Plan outlines the actions we will take to make progress on our ambition to eradicate child poverty.”
Picture courtesy of Glenn Halog
COMMONSPACE FORUM 31 January: 100 years on – Will the Clyde run Red again?