The future of the left since 1884

Aiming high

We need a post-war approach to target inequality, argues Uma Kambhampati.

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Opinion

The UK entered the pandemic with significant and rising inequalities, reinforced by recent austerity policies. Our death toll from Covid-19 reflects these disparities, and we are already seeing the unequal experience of the pandemic worsening them.

The UK is highly unequal on class and race terms. Before the pandemic, 80 per cent of white British working-age adults were in employment, while this figure was closer to 60 per cent for Pakistani and Bangladeshi groups. Not surprisingly, therefore, fewer than 2 per cent of white British households lived in houses with more residents than rooms, whereas this figure increased across all Black, Asian and minority ethnic (BAME) communities, and was up to 30 per cent for Bangladeshi households. Unequal Britain, a 2021 study looking into inequality in the context of Covid-19, found that less than half of Britons accept that these differences might arise because of discrimination.

According to the same study, nearly half of the public believe that those who lost their jobs during the pandemic were likely to have been underperforming; and one in eight Britons feel Black people are more likely to be unemployed or have lower incomes because they lack motivation or willpower. Until these attitudes change, the inequality gap will be hard to close.

An unequal society is a less resilient one, and the BAME experience during the pandemic bears this out.

Looking at the data then, it is clear the Bangladeshi community has suffered the most financial insecurity during lockdown. At large, BAME adults have been more concentrated in sectors shut down during the pandemic: 50 per cent of Bangladeshi men and 32 per cent of Pakistani men were employed in industries forced to close, compared to 12 per cent of white British men. And British natives who are BAME have been 1.7 times less likely than white British workers to enjoy employment protection like the furlough scheme, and were 3.1 times more likely to be laid off during lockdown.

A higher proportion of Black African, Black Caribbean and Indian adults have also been disproportionately represented in high-risk occupations, such as frontline and key workers on low-paid jobs, many of whom have been insufficiently protected with PPE throughout the pandemic. Data shows that the UK’s Black African community has been most exposed to the virus through employment. Plus BAME adults are more likely to be employed as sales and retail assistants, bus drivers and chefs, where exposure is high. This disparity is reflected in BAME deaths: for every three deaths per 100,000 for the white British population, there will be five for the Indian community, and approximately six for other BAME communities. Black Caribbean deaths in hospital are more than double that of white British deaths.

There have been many calls for more investment in the NHS and for better pay for key workers. Both are likely to help BAME communities. However, we need a clearer and more strategic response to the problem, based on the evidence.

The first, and probably most crucial act, is a clear acknowledgement of the costs borne by these communities during the pandemic, and a celebration of their contribution in enabling Britain to navigate its way through the crisis. It is vital that the public recognise there has been an unequal burden from the pandemic across ethnic groups. Without this, there will be no public support for policies that target BAME groups, as can be seen by the study on Unequal Britain.

To close the inequality gap, policymakers also have much to learn from the period after the second world war: its parallels to today’s situation are clear.

The post-war period saw the creation of new welfare constituencies at a time of significant economic destruction to help those most in need, such as ‘disabled war veterans’, ‘surviving dependents of killed servicemen’ and ‘war refugees’. Like the war, Covid-19 has left many dependents without support and many individuals suffering from long-Covid disabled, but the communities worst affected economically by Covid-19 are overwhelmingly single-earner families – with BAME households 18 per cent more likely than white British households to have a single earner. It will be equally important to divert resources towards these groups that have been most affected by the pandemic.

Sufficiently supporting single-earner families would require income transfers of the kind that were previously made to war veterans. Data from the International Labour Organization indicates that many European countries spent between 10 and 35 per cent of total social expenditure on civilian and military victims of war in the immediate post-war years. Yet given the public sector debt, this welfare expenditure needs to be carefully funded.

During the first and second world wars the country faced increasing military expenditure, but the acceptance that this burden should be equally shared led to higher taxes on the rich. To help fund today’s much-needed increased expenditure, we need a combination of time-limited higher taxes for those in the top brackets, along with the sale of government debt (in the form of bonds to rich individuals who potentially have significantly higher savings and few assets to invest in). This might, perhaps, be more acceptable to voters than just increasing taxes on the rich.

In the absence of such investments in our future, the UK will remain extremely vulnerable to future crises. The post-war period saw Britain rebuilding the economy towards higher growth and greater equality. There seems no reason why we could not aim for this once again, with new challenges, new growth sectors and a more innovative approach to government finances.

Uma Kambhampati

Uma Kambhampati is professor of economics at the University of Reading

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