Oxfam calls for inequality to be tackled as report shows financial differences

The richest 1% of Scots have an income of more than £2,600 a week while the poorest 10% of households have to get by on less than £240 a week, a new report has revealed.

The figures were contained in a new report published by Oxfam on poverty and inequality in Scotland - with a poll released alongside it showing three-quarters of people (75%) want to see wealth being distributed more evenly.

Almost two-thirds (64%) believe more needs to be done to tackle the problem of economic inequality, with only 19% stating politicians are doing everything they reasonably could to help.

After housing costs are taken into consideration, more than one million Scots are classed as living in poverty, with the report - which was produced in collaboration with the Fraser of Allander Institute think tank - stating: “Currently, one in five people in Scotland live in poverty. At the same time, the richest 1% own more wealth than the bottom 50% put together.”

It added: “Whilst the richest 10% of the Scottish population live in households with equivalised net income of more than £912 per week (£47,424 per year), the equivalent figure for the poorest 10% is less than £240 per week (£12,480 per year).

“The richest 1% of the population live in households with equivalised net income above £2,608 per week (£135,616 per year).”

David Eiser, research fellow at the Fraser of Allander Institute and co-author of the report, warned: “Income inequality in Scotland has returned to high levels last seen in the 1990s and, without action, the gap is forecast to widen further.”

Experts at the Institute for Fiscal Studies (IFS) and the Resolution Foundation have already warned inequality could increase over the next few years as a result of the UK Government tax and benefit decisions.

Mr Eiser said: “Many areas of policy which could be used to tackle inequality are in spheres of competence that are devolved to the Scottish Parliament, either wholly or in part.

“This includes education, childcare, housing, economic development policy, but also increasingly elements of taxation and social security.”

Increasing the basic rate of income tax in Scotland - as both Labour and the Liberal Democrats have proposed - could reduce one measure of inequality by “about 1% in Scotland”, according to the report.

Restoring the 50p top rate for the highest earners would “have limited effects” on the measure “given it would affect relatively few people”, it added - although such a move “is likely to be a useful tool in addressing the rise of incomes at the top”.

The report claimed the “political and policy landscape in Scotland is favourable to tackling inequality and poverty” with what “appears to be a genuine commitment to narrow the gap between rich and poor”.

It also said: “The policies to address inequality are not all currently in place.”

The new Poverty and Inequality Commission, to be set up by the Scottish Government, “creates an opportunity to address this mismatch by identifying solutions - however bold - based on evidence and mature analysis”, it stated.

Jamie Livingstone, head of Oxfam Scotland, said: “With nearly one in five people still living in poverty in Scotland, it cannot be right for the richest 1% to own more wealth than the poorest 50% put together and for income to be so unevenly shared too.

“It is very encouraging to see such strong public support for greater action to tackle inequality, as well as significant cross-party concern.

“The Scottish Government's commitment to create a Poverty and Inequality Commission reflects this and is a hugely positive move which presents a significant opportunity for progress.

“However, the commission must be designed for maximum impact.

“We urge the Scottish Government to ensure it is fully independent, scrutinises existing and proposed policies and focuses on exploring and recommending new policies to narrow the economic divide.”