Oxfam warns wealth gap is spiralling out of control

The number of dollar billionaires in the world has more than doubled to 1,645 since the financial crisis of 2008, according to a report which warned that inequality between rich and poor is spiralling out of control.

Despite the austerity affecting ordinary people around the globe in the wake of the recession, the richest 85 billionaires saw their fortunes increase by a total of around £150bn (€190bn) over the past year — the equivalent of £415m a day or almost a third of a million pounds a minute, the report by development charity Oxfam found.

Research earlier this year found these 85 people had access to wealth equal to that of half the world’s population.

If the world’s billionaires were taxed at a rate of just 1.5% on their wealth over $1bn (€780bn), it would raise £46bn a year — enough to get every child into school and deliver health services in all of the world’s poorest countries — said the report, entitled Even it Up: Time To End Extreme Inequality.

Oxfam’s chief executive Mark Goldring said: “Inequality is one of the defining problems of our age. In a world where hundreds of millions of people are living without access to clean drinking water and without enough food to feed their families, a small elite have more money than they could spend in several lifetimes.

“The consequences of extreme inequality are harmful to everyone. It robs millions of people of better life chances and fuels crime, corruption and even violent conflict. Put simply, it is holding back efforts to end poverty.

“Governments around the world have been guilty of a naive faith that wealth going to those at the top will automatically benefit everyone. That’s not true — it is their responsibility to ensure the poorest are not left behind,” the report read.

Oxfam challenged governments to follow a seven-point plan to rein in inequality, by clamping down on tax dodging; investing in universal free healthcare and education; introducing equal pay legislation; agreeing a global goal to tackle inequality; introducing minimum wages and moving towards a living wage for all workers; shifting the burden of taxation from labour and consumption towards capital and wealth; and providing adequate safety nets for the poor, including a minimum income guarantee.

The report found there are 16 billionaires in sub-Saharan Africa living alongside 358 million people in extreme poverty, while in South Africa inequality is now greater than it was at the end of apartheid.

If African levels of growth and inequality continue on current trends, it is estimated the continent’s poverty rate won’t fall below 3% until 2075.

Responding to the report, Bank of England chief economist Andrew Haldane said: “In highlighting the problem of inequality, Oxfam not only speaks to the interests of the poorest people but also the wider collective interest.

Nelson Mandela’s widow Graca Machel said: “The last decades have seen incredible human progress across Africa and the world. But this progress is under threat from the scourge of rapidly rising inequality.

“The good news is that this growing inequality is not inevitable. It can be resolved,” she said.