And the unprecedented monetary easing which dragged the UK out of the economic mire in 2008 onwards has merely served to fuel the gap further, according to research from Standard & Poor’s. Historical data show that income inequality began to widen in the 1980’s after shrinking for much of the first 70 years of the 20th century. But the pace has picked up since the turn of the 21st century to the point where in 2012 the top 10 per cent of UK earners accounted for almost one third of national income while the bottom 10 per cent received less than 3 per cent of national income. This income gap ratio of 10.5 to 1 is higher than the likes of France, at 7.4 to 1, but still considerably less than the US where the income gap ratio in 2012 was 18 to 1.
The introduction of record low interest rates and the purchase of assets through £375bn worth of quantitative easing has merely exacerbated the problem as the richest echelons of society tend to own significantly more financial assets and property assets – the two man beneficiaries of QE and low interest rates. This meant that the share of net financial wealth in the UK held by the top 10 per cent rose from 56 per cent in 2006-2008 to 65 per cent in 2012-2014.
