Wealth inequality between the north and south of England is set to grow, with the gap reaching £228,800 per head by 2030, according to a thinktank report.
The Institute for Public Policy Research North’s annual State of the North report states that although the average wealth of people in England has grown from about £226,300 in 2010 to £290,800 by 2020, inequalities between regions have almost doubled in the same period.
“It’s hard to avoid the conclusion that we are headed in the wrong direction on inequality in health, wealth, power, and opportunity while local government finances languish in chaos,” said the report author and IPPR North research fellow, Marcus Johns.
The report identifies the north-east of England as having the lowest overall and average level of wealth in the country, with the relative level of median wealth being lower now than it was in 2006.
It finds that the highest level of wealth exists in the south-east of England, with average wealth per head being £415,200 – around £195,400 more than the north’s £219,750.
Wealth inequality is on the rise across the nation, with the IPPR report stating the richest 10% hold almost half of all wealth. However, inter-regional differences are evident as the relative levels of wealth inequality are higher in areas in the north than in the south-east.
If current trends continue, the IPPR forecasts a greater unemployment gap – with London’s employment rate set to be 66% in 2030, compared with 56% in the north-east.
The report also says local government spending cuts have “undermined devolution” with up to £2,000 being lost per head.
Zoë Billingham, the director of IPPR North, said: “It’s electoral crunch time and politicians cannot afford to ignore the increasingly marginal yet critical northern voters as they go to the polls twice in the next 12 months.
“Action is also sorely needed to correct course on local government finance. If we continue with the status quo, communities will continue to feel the impact of retreating public services as well as undermining the very aims of devolution.”
Another key finding by the IPPR is that the age expectancy gap between the north and south of England will not close until 2080.
Johns said: “No one should be condemned to live a shorter, sicker, less fulfilling, or poorer life simply because of where they were born.
“This is a crucial year for elections, locally and nationally, and Westminster cannot afford to ignore the state of the north.”
The thinktank sets out some suggestions in the report, including to rebalance wealth by investing £7.6bn a year over 15 years across England’s regions and introducing a targeted wealth tax.
It also suggests investing £4bn of stabilisation funding into local authorities, increasing job opportunities nationally and implementing the IPPR Health and Prosperity Commission’s health and prosperity improvement zones, which will target communities who need the most healthcare.