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Poverty and prosperity sit side-by-side in British cities

Poverty and prosperity sit side-by-side in British cities

David Cameron’s tax affairs controversy has propelled the state of UK inequality into the centre of political debate. While the Prime Minister’s ‘tax planning’ may be legal, it taints claims that ‘we are all in it together’. It is the poor who have borne the burden of austerity, while the rich have their tax havens. And British companies now have the lowest rate of corporation tax in the industrialised world.

What the never-ending tale of woe around the pugged away wealth of Cameron father and son reveals is that tax rules mostly benefit the rich, while the poor have to put up with the benefit cap, the bedroom tax and the food bank.

This is not surprising since much of Parliament has been progressively captured by the representatives of the rich since 1979, when equality’s steady advancement for much of the 20th century was halted by the election of Margaret Thatcher, with accompanying city ‘big bangs’ and lowering of the higher rate of tax from 60p to 40p.

The gulf in wealth inequality has widened with the top 1% owning as much wealth as the bottom 55%. Over the last five years, the salary gap between the top 10% of earners and the bottom 10% has worsened by 4% to stand at over £42,000 a year.

The recently published ONS Index of Multiple Deprivation underscores that poverty in British cities sits alongside increasing prosperity. The gap between the deprived and the affluent in cities like Birmingham has widened since 2010. The chief culprits are the government’s austerity policies welfare reform and centrally-imposed cuts to local government services. These have hit those at the bottom of the income scale hard and have furthered geographical concentrations of poverty and prosperity.

In Birmingham, two fifths of the city’s 639 neighbourhoods are placed in the 10% most deprived in England. These are located mainly in the inner city with older housing and large black and minority ethnic populations, but are also associated with Birmingham’s social housing estates, often located on the city’s outer limits. Birmingham’s leafy suburbs, on the other hand, are among the least deprived nationally. 

This deprivation divide kills. Life expectancy between the inner city and comfortable suburban life can be as much as 12 years. This is what it means to be ‘poorly’ – being poor shortens life, and stunts life chances.

In England’s second city, deprivation is linked chiefly to poor housing conditions, especially overcrowding and fuel poverty, and concentrations of low incomes and precarious employment. Home ownership in Birmingham has receded, while private renting has more than doubled since 2001. One in five Birmingham residents now live in the private rented sector, blighted by high and rising rents, insecurity, and in some cases, harassment from landlords.

However, against a backdrop of dwindling resources, Birmingham-based agencies have striven to counteract the worst effects of policies like austerity and welfare reform that have intensified deprivation among already struggling communities.

Birmingham has a long history of confronting poverty, going back to the Quaker tradition that created Bournville Village Trust. Labour-led Birmingham City Council is trying to boost general prosperity across the whole of the city by backing of ambitious infrastructure projects, supporting cultural renewal and building on a strong higher educational legacy.

The reality, or course, is that even large cities such as Birmingham can only do so much against macro-economic and social policies that exacerbate poverty and inequality. Without the rich paying their fair share within a progressive tax system, and companies being good corporate citizens, poverty can only worsen in British cities throughout this Parliament.