IT was gratifying for me to find, after last week’s column, how many readers agreed with my observation that inequality is built into our wage structures, so that large numbers of the workers themselves in effect endorse and support the kind of inequality which is based on age, qualification and experience. In everyday terms, we accept that the time-served welder deserves to earn more than his apprentice.
This is unequal, but is it unjust? I don’t think so. If I am right, then the arguments we have all the time in Scotland on this delicate subject – which I welcome and encourage, if only because they don’t happen in England – need to treat the concept of equality in a rather more nuanced fashion than is usual in newspaper columns, conference speeches and the like. In these media, equality is mostly a mantra. While its mindless repetition may enhance feelings of approval or self-approval, it does nothing to address or solve problems in the real world.
The Scottish Government itself never ceases to let us know how much it loves equality. Only last week Angela Constance, our Equalities Secretary, announced that “councils and health boards in Scotland will have to put tackling inequality at the heart of every decision they make”. Yet in the public sector we have three groups I can immediately name – the nurses, the police and the schoolteachers – whose complaints about unequal treatment in terms of pay and conditions stretch back over many decades. No doubt we can blame Tory and Labour governments of the past for this stubborn discontent but surely, after 10 years of SNP benevolence, we might have expected a bit faster progress towards equality for these occupations than we have in fact seen.
If this is equality in the public sector, there cannot be much hope for the private sector. In fact, I don’t believe the Scottish Government intends to do anything serious about the private sector at all. The wage structure, whether in industry or services, is a vast and delicate mechanism of which officialdom has little knowledge in detail. To blunder in on it when the concepts of equality meant to be enforced remain so vague and insubstantial would just invite chaos and disaster. Forget it. Better for equality to remain a mantra. Better indeed to stop chanting it altogether.
Still, here I want to turn to another aspect of inequality arising from last week’s debate, to inequality of wealth. Since the financial crisis of 2008 this kind of inequality has been worsening. Especially in the most recent period, wealthy people have been able to restore their finances, while the rest of us are struggling to get back to our position of ten years ago. In the UK, the gap has yawned wider than in most countries. It should be pointed out, however, that nearly all the super-rich reside in London and the south-east of England. In Scotland we largely lack this class of people and so we remain in relative terms, and to a modest extent, a less unequal country.
There are still dukes whose acreage is measured in the hundreds of thousands, with perhaps a Rembrandt or two to adorn the walls of the castle. But for the vast majority of people in Scotland, wealth is held in two forms: in housing and in pensions. If we really intend to tackle the disparities of wealth, it has to be at the cost of the prosperous middle class. Reader of The National, I’m probably talking about you.
Home ownership was a traditional marker of class in Scotland, but no longer. Because so many tenants of local authorities bought their houses and flats while they had the chance, the proportions of people living in private and in public homes are now roughly the same as in England. Scots won access to a new form of wealth, housing equity, that was never available to them before. The wealth has often multiplied without the owners needing to do anything. UK Governments, desperate to give economic growth a shove, have adopted policies such as buy-to-let, designed to make the owners feel richer and spend more. The main practical result has been housing bubbles, in which the price of property inflates out of all proportion to other values in our economy.
The bubbles are at their biggest in London, and appear only on a lesser scale in Scotland. But, with about 60 per cent of our housing stock now in private hands, home ownership has still spread wealth among the population, among three million of our five million at least, on a scale no government could achieve through tax-and-spend. The SNP has viewed this spread of wealth with suspicion, perhaps because it raises a huge obstacle to further redistribution. Bluntly, if a further redistribution is to take place, we need to take away some of the wealth of home owners and hand it over to the unpropertied poor. How? Send your answers on a postcard to the Scottish Government. My role is to point out that this chain of events is difficult and unlikely. One possible road to equality is in effect blocked off.
As for pensions, state pensions first of all, we are by European standards not especially generous to our old folk in the UK. Anybody condemned to living on the state pension alone will live in poverty. Mean as it is, we face ever greater challenges in paying it because of the rising proportion of pensioners in the population. Still, in Scotland only 27 per cent of the elderly remain wholly dependent on the state pension, with the rest enjoying some private provision, either through a workplace scheme from their years of employment or else because they have gone to the trouble and expense of saving up for a pension of their own. The net result of a long-term shift in saving habits has been positive: pensioners are the only group in society who in recent times have seen a steady rise in their average real income.
But for egalitarians there is a sting in the tail of this reasonably happy story. It means that the wealthiest age-cohort in our society are the people in their 60s approaching retirement. They have saved during their working lives to fill up a pension pot, out of which they will live for the 20 or 30, nowadays even 40 years left to them. Till the date of their retirement, this is wealth held in the form of investments by pension providers. If we are single-mindedly in favour of redistribution, some of it would need to be taken away and given to other age-cohorts. How can this be warranted? It would be another example of an insistence on equality leading in practice to injustice, probably social catastrophe.
In the Scotland of the 21st century, housing equity and pension rights are far and away the most important forms of wealth, widely though not universally distributed. They are also expressions in the form of financial assets of our free, open, liberal and diverse society. An attack on them will be an attack on this sort of society. That is why I do not think it will ever happen. If I am right, the inequality in Scottish society is for the most part irreducible. It is part of the way we live and organise ourselves. It does have positive results as well. A government which talks of dismantling the whole apparatus is merely deluding itself. That is the message I would like to send it on a postcard.
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