politics

Johnson promised to ‘level up’ – instead the UK’s wealth divide is worsening | Polly Toynbee


“Levelling up” was always a slippery slogan. If the civil war was Boris Johnson’s period of history, he might have shunned its potential association with the Levellers and the Diggers, who dug up the fences of enclosures for the landless to plough and sow.

Their most famous digging, in the year of Charles I’s execution, was St George’s Hill in Weybridge, Surrey, now in a gated and guarded enclosure including a grand golf club where nearby house prices reach £5m. Stand there and ponder what levelling up can possibly mean to Surrey Tories and their MPs.

It was a bold slogan to announce, in the context of a skyrocketing stock market and soaring UK house prices, which rose by 9.8% last year, the fastest rate since 2007. Meanwhile, workers were furloughed and food banks hard-pressed. This is the first postwar recession with rising property values, says the Resolution Foundation. This year, on 7 January, FTSE 100 chief executives had already earned more than the median pay for all full-time workers in the UK, according to The High Pay Centre.

The latest ONS wealth figures show that the gap between rich and poor in the UK has now grown to its widest in a decade. It has “steadily increased to 36.3%” according to the ONS, which measures inequality by the Gini coefficient, whereby 0% represents total equality and 100% represents total inequality. This is awkward for Johnson the Leveller: until now Tories could claim inequality had become no worse under their government. But here is the history: the much-maligned 1970s were the most equal time on record; in the 1980s, there was a meteoric rise in top pay and wealth soared, while the lowest salaries fell behind. That great gap never narrowed again. The richest 10% of the population now own 43% of wealth, leaving the entire bottom half just 9%.

What was Leveller Johnson’s reaction to official figures revealing wealth gaps widening between north and south, old and young, white and other ethnicities? At PMQs last week he wrongly claimed that “inequality is down in this country”.

He wants “levelling up” to be purely geographic to seduce red wallers, but he should be warned: the south-east’s median household wealth rose by 43% in 16 years, while it fell in the north-east. Whatever trinkets Michael Gove crafts to decorate his levelling up white paper this month, he and Johnson are unlikely to admit the mammoth endeavour it would take to shift the dial even slightly. Sunak has set aside just £4.8bn for the levelling-up agenda, which is a teaspoon to shift a slag heap. About £2tn was spent to level up East and West Germany – and they are still only 85% of the way there.

Johnson’s cabinet is in undisciplined revolt. Jacob Rees-Mogg let it be known he led a protest against the national insurance rise and called for a cut in the civil service pay bill instead: “cut the bureaucrats” is the last refuge of dishonest politicians. Senior Tories call for the pensions triple lock to be restored. Behind them thundering hooves gallop after axing VAT and green taxes on energy bills. Insurrectionist Mark Harper, a former chief whip, says he will declare a leadership challenge if May’s local election results are bad. David Frost, the Brexit bruiser, brays for “free markets and low taxes”.

The government is reportedly panicking at a “chicken run” of red wall Tory MPs defecting to Labour, for fear of losing their seats where Labour polls 16% ahead, a comically unlikely route to securing tax or green policy cuts those MPs want.

The Tories are right to quake as the May elections near, when April really will be the cruellest month as households face the crunch of £1,200 in extra bills as council tax rises and 5 million social housing tenants face the highest rent rises in a decade. Meanwhile, wages and benefits fall behind.

The hard truth is that there never was and never could be a Tory “levelling up”. There are good ways to ease the cost of living crisis, but none are Conservative ways. Any levelling must start with restoring the £20 a week removed from universal credit, but that’s unTory.

Johnson’s government could impose a windfall tax on the six companies that made £16bn excess profits out of the pandemic, says Tax Justice UK. It could tax the excessive gains made by the bizarre increase in property values, says the Resolution Foundation. This weekend, the shadow chancellor, Rachel Reeves, advocate of wealth taxes, laid out Labour’s plan to cut £200 from all energy bills and £600 from those of the neediest households, paid for with a windfall on North Sea oil and gas profits. The BP CEO, Bernard Looney, unwisely said energy price rises had turned his company into a “cash machine”, while the North Sea company Serica promises its shareholders bumper returns. A revaluation of council tax to create a “proportional property tax” would help 75% of households, reports Fairer Share. Sunak could revive his dropped plan to lift capital gains tax from 20% to 25%, which would have brought in a handsome £14bn. These would be popular ways that could pay for stricken public services, but they aren’t Tory ways.

The public never voted for this hard Brexit, this graveyard of trade deals with its colossal loss of 4% in GDP, depriving the Treasury of precious receipts. But the nature of this Tory cult decreed it.

“There’s no point in saying you’re Conservative,” protests a senior Tory to PoliticsHome, “unless you cut taxes.” The axe is the emblem of this cultish Tory generation. When it comes to levelling up, the dishonest contradiction of Johnson’s cakeism has finally landed, jam side down.



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