Ordinary wealth in every postcode

This month saw a new Prime Minister take office and a new Government take shape. In response, our Head of Politics & Advocacy Jason Bunting set out why tackling extreme economic inequality should be the defining test of Andy Burnham’s government, and how he might go about meeting it.

We outlined how wealth now plays a bigger role in shaping life chances than at any point in living memory, and how the inability of people across the UK to build ordinary levels of wealth is frustrating growth, cohesion and faith in democracy.

In fact, the new Prime Minister’s own diagnosis, that Britain has concentrated political power in London while privatising and deregulating the economy, matches our research on a widening wealth gap caused by the extraction of value from our economy, and an economic model where too many don’t share in the same proceeds.

Britain took a series of wrong turns in the 1980s. Political power was centralised and economic power was privatised. The country surrendered control of the essentials – housing, water, energy, transport - and left people exposed to higher costs. That in turn led to the concentration of more wealth and power in the hands of fewer people and fewer places.

Andy Burnham, on becoming Labour Party Leader

To address these challenges, we argue that redistribution alone won’t be enough. Instead, the new Prime Minister needs a programme that reshapes how wealth is created, shared and governed, including through more effective fiscal devolution, improvements to the taxation of wealth, and the creation of more guardrails between money and political power - including by capping political donations.

Read the full piece

The Billionaire Factory

In the next instalment of our monthly interview series, our Head of Policy & Research Jack Jeffrey spoke with award-winning author Hettie O’Brien, author of The Asset Class, about how private equity became one of the most powerful forces reshaping the UK economy. O’Brien traces the industry’s roots to a reaction against managerial capitalism, explains how Britain became PE’s “experimental laboratory” thanks to its aggressive privatisation agenda. She also unpacks how firms have loaded unsustainable debt onto companies, as in the case of Thames Water, to enrich a small group of financiers rather than to invest in productive capacity. O’Brien is sceptical of the industry’s pitch that channelling pension savings into private markets “democratises” returns, arguing that it looks more like creating powerful coalitions against reform.

She also called attention to the “explosive political potential” for mobilisation posed by the sectors now infiltrated by private equity, including water, housing and care. She highlighted the example of local campaigners like Becky Malby in Yorkshire, who has led a campaign to hold the environmental regulator in the water system accountable. Given the deep dissatisfaction with the cost and quality of public services in Britain, it’s not hard to see how a powerful coalition could be built in opposition to value being siphoned away from them by damaging forms of private equity.

In the context of a new government which is explicitly seeking to challenge the power of vested and private interests in our economy, the role of private equity in our public services will become ever more important over the coming months.

Read the full interview

AI will kill off the lingering myth of meritocracy

This month, we released a new piece from our Chief Executive Will Snell, who argues that AI won’t just automate some jobs or create labour market displacement, but could help to finish off the idea that reward tracks merit.

Where the existing critique of meritocracy rests on unequal starting points (talent, family wealth, geography), AI removes something that survived even that critique: the ability to infer effort and skill from what someone produces. When anyone can generate a competent strategy document or piece of code in minutes, the signal that work sends about the worker starts to dissolve, and reward shifts instead toward whoever owns the model, the data and the compute.

His conclusion is that if we can no longer credibly claim people’s place in society reflects their merit, we need a different basis for deciding how resources and status are distributed.

Will’s analysis links to our founder Julian Richer’s comments on why acknowledging our own good fortune would make the world a better place. In that piece, Julian argued that many people under-estimate the role that luck has played in our lives, and that a greater admission on the part of successful people of the role of luck in that success would help policymakers to act on inequality.

Read Will's full piece

The right should not tax work more than wealth with Bright Blue’s Centre Write

While taxing wealth is sometimes seen as the preserve of the left, in this piece for Bright Blue’s Centre Write magazine, Will makes a case aimed squarely at a centre-right audience. In it, he argues that action to rebalance Britain’s 4% average tax rate on wealth versus 33% on work should be as much their cause as anyone else’s.

Will explains how taxing work in this way more than wealth bends incentives away from genuine graft and enterprise and toward rent-seeking, distorting competition by unfairly rewarding incumbents over challengers.

Reforms like equalising Capital Gains Tax with Income Tax (last attempted by Nigel Lawson) would raise an estimated £11.3 billion a year. Yet beyond arguments for revenue raising, the real centre-right case is that rewarding work more than wealth properly rewards opportunity, freedom and market competition, all values at the heart of a centre-right case for a fairer economy.

Read the Bright Blue piece here

How to get Britain behind Burnham’s new vision

Finally, we were pleased to be featured on the HopeWorks blog this month, as Will asked what it will take to convert the new Prime Minister’s bold rhetoric on wealth and power into public support for action. His answer is to frame reform around fairness rather than equality: the “fair necessities” of fair essentials, opportunities, rewards, exchange and treatment. That framing can help transform the strong public support for tackling inequality (our polling suggests 85% of Britons are worried about inequality) into a powerful mandate for change, anchored in the shared principle of fairness. It can present a nuanced and concrete way of thinking and talking about fairness, helping the Prime Minister to deliver on his bold political vision in a way that brings the country with him.

Will’s argument previews arguments from his upcoming book The Fair Necessities: Why We Need a Fairer Britain and How to Make It Happen, which is out on 8 September with Policy Press. The launch event is on 8 September at King’s College London (register in person or online).

Read the HopeWorks article here

In the coming months, we’ll continue to explore these issues and more. As ever, if you’d like to support our work or collaborate on upcoming projects, please do get in touch.

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It’s telling that the new Prime Minister’s chief criticism of his predecessor Tony Blair’s contribution to Labour’s recent internal debate was that he ignored inequality.

The conviction that Westminster has long overlooked the distributional consequences of its decisions sits at the heart of Burnham’s own diagnosis, and it’s likely to be a defining feature of his governing agenda in the months ahead. As the new Labour leader said in Friday’s victory speech:

Britain took a series of wrong turns in the 1980s. Political power was centralised and economic power was privatised. The country surrendered control of the essentials – housing, water, energy, transport - and left people exposed to higher costs. That in turn led to the concentration of more wealth and power in the hands of fewer people and fewer places.

He takes office at a moment when the evidence on this could hardly be clearer. Our research has shown that the wealth gap has widened dramatically over recent decades, driven by rising asset inequality, and that wealth now plays a bigger role in shaping life chances than at any point in living memory. The consequences extend well beyond fairness: extreme wealth inequality is frustrating economic growth, undermining community cohesion and eroding faith and trust in democracy.

Burnham is right that successive governments failed to confront the scale of this challenge. The result is an economy in which, as the incoming Prime Minister has outlined, wealth, opportunity and power have become concentrated among a small number of people and in one corner of the country.

This concentration is no accident. Over recent decades, governments have centralised power in London, while privatising and deregulating swathes of the economy. Their decisions have built an economy that rewards ownership over work, and the extraction of value from existing wealth over the creation of new wealth.

Along the way, Britain has lost sight of the distinction between economic activity that raises living standards and activity that simply drains wealth from others. Too often, the latter is effectively given a free pass in our economy. This has created an unfair playing field, with too few people able to share in the proceeds of growth.

Redistribution of wealth will not be enough to reverse this trend. Instead, we must demand a programme that reshapes how wealth is created, shared and governed. That means a serious programme to tackle both the causes and the consequences of extreme wealth inequality. It means giving more communities a fairer share of economic opportunity, and building a policy agenda around broader and fairer access to wealth. And it means confronting the extraction built into today’s economy while backing Britain’s productive sectors. This could include an agenda that introduces new measures to reform private equity, helps young innovative firms to scale, and ensures that work is rewarded more fairly by taxing unearned wealth more effectively.

It also means sharing wealth more broadly. New wealth funds could ensure that income-generating assets are held more equitably, so more people benefit as the economy grows. Effective fiscal devolution could strengthen the inclusivity of regional economies, while renewed investment in public services will become even more important, particularly as AI reshapes the economy.

Finally, it also means building guardrails between money and power. Rebuilding trust in democracy requires urgent political reform, including through capping political donations in the Elections Bill and delivering on Burnham’s promise of long-term politics through a new Committee for the Future in Parliament.

If Andy Burnham is serious about building a fairer Britain that delivers good growth in every postcode, then tackling extreme economic inequality must be a central tenet of his agenda. That means providing everyone with the opportunity to build ordinary wealth, guaranteeing a basic floor of security on which we can all rely, and giving everyone a fair chance to contribute to, and benefit from, our economy. The incoming Prime Minister has already recognised this in his diagnosis. The challenge now is to build the policy agenda capable of delivering it.

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A year ago, I wrote a piece for the RSA about myths of merit in an unequal society, in which I argued that the meritocratic narrative both masks and justifies economic inequality. What looks like merit is mostly luck: the luck of being born to the right parents, in the right place, with the right start. If we paid more attention to how much our life trajectories are influenced by this broad conception of luck, we would take bolder action as a society to reduce the inequalities that underpin it.

In the intervening twelve months, the capabilities of large language models have developed enormously. I don’t know about you, but I have shifted rapidly, and recently, from being sceptical about the impacts of AI to being pretty convinced that it will drastically reconfigure our economy over the next few - and I mean few - years. I’m far from alone in thinking this (although I do think that many people have their heads in the sand), and the British public is also concerned. A few recent articles worth reading on this include those by Rutger Bregman, Martin Wolf in the FT, Simon Johnson (chair of the UK’s new AI Economics Institute), Roa Powell, Matthew Harvey Sanders, and Pope Leo XIV.

And some of the projections are sobering. Sanders quotes Mustafa Suleyman, CEO of Microsoft AI, predicting that most white-collar work will be “fully automated by an AI within the next twelve to eighteen months.” He cites estimates of a 50% chance that artificial general intelligence is with us by 2030 - within four years - leading to one person doing the work of hundreds. And he quotes Demis Hassabis, CEO of Google DeepMind, who said last summer that “AI will be ten times bigger than the Industrial Revolution and perhaps ten times faster, unfolding over a decade rather than a century”.

We’re not paying nearly enough attention to the tsunami that is headed our way, and to the drastic steps that we need to take now to prepare for it. As Martin Wolf said in the FT, “there is a good chance that AI will in time devastate the labour market, increase inequality and create an extraordinary concentration of economic - and so political - power in the hands of a tiny number of businesses and people… A good part of the increased income and wealth must be shared. The time to prepare for this is now. If we do not act, it will be far too late”.

However, in this post I want to focus on one even more neglected aspect, that has important implications for how we think about ourselves and each other. If the myth of meritocracy is already wobbling on shaky foundations, I suspect that the AI revolution will finally shatter it - with implications both good and bad.

The existing critique of meritocracy largely rests on the fact that life chances and outcomes owe as much to luck as to merit (talent + effort). This is exacerbated by the fact that both our society and the labour market values cognitive skills more than manual labour or care work, as David Goodhart argued in Head Hand Heart. But the rapid adoption of AI is completely undermining our ability to measure cognitive talent and effort in the first place.

Before AI, we would look at what someone produces, whether it was a report, a strategy, a diagnosis, or an elegant piece of code, and would be able to infer fairly accurately the level of both effort and talent that must have gone into it. In theory, the person who produced this output would be rewarded accordingly - with money, but also with status, respect, and the unspoken assumption that these rewards were fully deserved.

Critics of meritocracy, including myself, would argue that the ‘inputs’ into this process were unequally shared out, and were not ‘earned’. People were born with different talents, into families with different amounts of wealth, in poorer or richer parts of the country, into very different social networks, and so on. So the outputs could not be judged against a fairly distributed set of inputs.

However, what was at least relatively safe (bar cheating) in the pre-AI era was the assumption that the outputs belonged to the person. The fairness was upstream of the task. This is no longer the case. When anyone with a monthly subscription to an LLM can produce a competent strategy, marketing plan or web prototype in minutes, it is no longer possible to judge the ‘merit’, however deserved or not, of the person who submitted it. The signal that work normally sends about the worker has dissolved into noise. The myth of meritocracy depended on legible proof of desert, but AI has made the proof illegible.

Luck undermined meritocracy because the race was rigged, but at least the times on the clock were real. AI destroys meritocracy because we can no longer trust the results of the race at all.

Some might read this as an uncomplicated good news story, that capability is democratised, that everyone’s talent is unlocked. And that might be true to an extent in a future economy in which AI is mostly used to augment workers. But, as the articles cited above suggest, the more likely scenario is the rapid use of AI to replace workers. And in this scenario, an increasing share of the rewards goes not to the individuals who nominally produce the work, but to the people and organisations who own the model that did much of the actual work, the data it was trained on, the compute that it runs on, and the platform that distributes it. Reward is detached from merit, and from labour, and re-attached to ownership of the infrastructure.

Unfortunately, this is a trend that has been accelerating in our economy over recent decades anyway, quite apart from the impacts of AI. As Piketty observed in 2014, capital is attracting higher returns than labour, in a self-reinforcing cycle. Increasing amounts of wealth are extracted rather than created, in particular by companies who own a scarce asset and charge excessive amounts of ‘rent’ to access it, from housing to land and infrastructure. AI looks poised to supercharge our already-advanced transition to a rentier economy, except that this time the rent is also being extracted from cognitive labour. Talented and hardworking knowledge workers face being rapidly ejected from the top of the meritocratic pyramid, and being turned into tenants, digital serfs, paying for the tools that do the real thinking while the companies that own the real means of production reap the rewards.

To those who object that technological advances have always changed working habits - that the calculator did not undermine mathematical talent, that the internet did not destroy the job market for researchers - the AI revolution looks different. Unlike its predecessors, it doesn’t just automate the periphery of knowledge work; instead, it can take over the core components, the thinking, the reasoning, the writing. This reduces the role of human judgement to knowing what to ask and how to check the answer - hardly the basis for a functioning system of reward based on meritocracy.

If we collectively recognised this state of affairs, it could unlock a consensus for making some of the radical changes to our society and economy that the AI era demands. If we can no longer credibly tell people that their place in society reflects their merit, we need a different basis for deciding how both economic resources and intangibles such as social status are distributed. We cannot keep on distributing money and respect based on a metric that has no meaning. And we need to recognise that the coming ruptures to the labour market will threaten not only people’s livelihoods but also their sense of purpose and meaning, unless we take radical steps to rethink how we organise our society.

That means taking seriously the ideas that the myth of meritocracy was designed to keep off the table - reducing inequality, distributing resources more fairly at source rather than relying on the tax system to do what it can to redistribute them, spreading ownership of tech stocks so that its returns are widely shared rather than privately captured, and decoupling human dignity from a merit metric that no longer works. It means, ultimately, a new social contract, grounded not in the fiction that we get what we deserve, but in the question of what we owe each other. The myth of meritocracy allowed us to spend decades collecting gaslighting ourselves into believing that this question was already answered, but it never was. Now we no longer have the excuse of pretending otherwise.

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In The Asset Class (2026), Hettie O’Brien charts how private equity (PE) became one of the most powerful forces reshaping our economies. In this conversation, she discusses the intellectual origins of the leveraged buyout, why Britain became PE’s experimental laboratory, the mortgaged futures of companies like Thames Water, the push to ‘democratise’ private markets through pension savings, and what alternatives might look like.

Note: The title of this post comes from a 2020 paper, An Inconvenient Fact: Private Equity Returns & The Billionaire Factory, by Ludovic Phalippou at the University of Oxford’s Said Business School.

Jack Jeffrey (JJ): In the introduction to The Asset Class, you reference Richard Hofstadter’s essay The Paranoid Style in American Politics (1964). In that he describes the paranoid style as “a style of mind that is far from new and not necessarily right wing... no other word adequately evokes the sense of heated exaggeration, suspiciousness and conspiratorial fantasy that I have in mind.” As you write in the book, there has been a lot of interest in private equity from the MAGA right, which portrays the industry as a conspiratorial plot to dispossess Americans of their assets. But as you also outline, PE has fundamentally transformed countries and not for the better. I’m interested in how you negotiated that tension between conspiratorial paranoia and justified suspicion when researching the book?

Hettie O’Brien (HOB): It’s something I frankly struggled with. I found it epistemologically challenging to figure out what I thought about arguments coming from a political perspective that I find pretty loathsome. But spending time on online forums, watching YouTube videos, listening to MAGA discourse about private equity, there were aspects of what they were saying that were true, even if the facts were often wrong.

There was a MAGA-adjacent influencer who had a particular line about how the industry had invested in “the things we cared about most [...] the things you will pay for, no matter what”. When I first heard that, I thought it was too convenient and simple as a narrative. But actually, it’s true. The motivations behind PE aren’t necessarily conspiratorial. They have to do with a confluence of different economic factors and trends. The low interest rate, post-2008 climate, prodigious access to debt, the retreat of the state, the sell-off of public assets. Taken individually, there is no Bond villain stroking a white cat in a secret room designing all of this. The reasons are largely economic. But the result can look and feel like a conspiracy because PE is so powerful.

I initially felt this had all the hallmarks of a great conspiracy story. But as a journalist, I care about being accurate and faithfully representing reality. I think anyone with a vested interest in the idea that truth corresponds to some shared factual reality tends to struggle with the idea of conspiracy because it seems so premodern and inattentive to those facts. There’s that Naomi Klein line I quote in the book: “conspiracy culture gets the facts wrong, but the feeling is right.” In much the same way, I don’t think it’s paranoid to want to resist PE. People are justified in feeling that things are unfair, and that this industry plays an outsized role in shaping everyday life. That makes it incumbent on people who want to tell the truth to both uncover what is happening and for politicians to make a case that it needs to change.

JJ: One of the things the book does really well is lay out the intellectual scaffolding of the PE model which, as you say, was a response to the perceived problems of managerial capitalism. That was really clarifying. But I’m interested in where you locate the failure. Is it in the ideas themselves, their selective application, or the post-2008 political conditions that have allowed private equity to colonise specific sectors?

HOB: I kept asking myself this while writing the book. Is the government to blame, or a series of pernicious academic ideas? I think it’s both. There were real policy failures and missed opportunities, such as the decision, in Britain, not to borrow when money was really cheap after the financial crisis and instead to embrace a devastating programme of austerity. That has meant that British people now live with both an immiserated public realm and a generalised acceptance of the idea that the government can’t afford things that would improve peoples’ lives, and instead needs private capital to do the things the state won’t. That’s a political failure, both of action and inaction.

But I also think ideas are important. I was interested in the origin story – partly the hangover from the post-war corporate consensus in America, the idea of managerial capitalism, and the pushback mounted by a renegade group of financiers against the Chandler idea1 of what a corporation is supposed to be about. And when you drill down into the actual mechanics of PE, the central technique is the leveraged buyout. There was always this idea that in heaping debt upon companies you’d make them leaner, meaner, more efficient. But there was never really any empirical evidence cited for that.

I look at the work of Michael Jensen2, who wrote papers on both the principal agent problem - the idea that public corporations had an intrinsic issue with managers rather than owners being in charge and therefore not producing enough value for shareholders – and a follow-up paper3 suggesting that debt was a way to resolve this tension. If you heap debt upon a company, it would force managers to take decisions resulting in more efficient companies. Yet again, he cited no empirical evidence. Whilst in the first wave of leveraged buyouts in the 1980s you could argue it worked to some extent, from the 1990s onwards, what PE has really contributed to is a sustained increase in leverage.

That raises the question of who benefits. It looks like a form of legalised arbitrage where a small group of financial insiders use the corporate form to borrow in order to enrich themselves, rather than doing what postwar corporations did which was borrow to build things, to expand, to do capital-intensive productive things (I’m not idealising here about midcentury corporations, or public companies - Enron was a public company, after all). Instead, you see an abuse of the corporate form: borrowing to enrich the owners rather than improve the company, and rerouting money away from the taxman through interest deductibility.

JJ: Just to follow up on whether PE is context specific. To what extent was the austerity decade of the 2010s a pivotal moment in this story? And now that those conditions have disappeared, i.e. that interest rates have ticked up, will PE be as pernicious and dominant as it has been?

HOB: This can look like a post-2008 phenomenon – catapulted by extremely low interest rates, quantitative easing, specific opportunities that emerged particularly in land and property. When the real estate bubbles popped in America and Spain, for example, there were opportunities to buy up housing, which is how thousands of people who had never previously heard of Blackstone first learned about the firm. But in reality the story goes back much further than this.

Britain specifically was almost like an experimental laboratory for PE; as Sadek Wahba, the founder of an infrastructure investment fund, put it in his book, Build: Investing in America’s Infrastructure, the UK has served as "a model to the world" in terms of infrastructure privatisation4. That has to do with the sale of public assets at an aggressive pace. Speaking to people who used to work at Macquarie - the Australian investment bank and infrastructure fund manager that began as the Australian subsidiary of British merchant bank Hill Samuel - there was a sense that when those Australians were sent back to Britain to buy up assets from sleepy local councils, Britain had created an incredible opportunity for PE’s encroachment into public services. That goes back to Thatcherism and its tail end, and then to PFI (the Private Finance Initiative), which started under John Major but became a hallmark of the New Labour era.

And if you want to go back even further, PE can really be read as a reaction against the social democratic and corporate consensus that emerged in the New Deal era in the US. It was an attempt to restore power to company owners and resembled an attempt to take the economy back to something resembling what it looked like during the Gilded Age, before Roosevelt regulated Wall Street and before the SEC (the US Securities and Exchange Commission) was created. There’s a brilliant line I quote from Henry R. Kravis: “Where have the Carnegies and the Mellons and the Rockefellers gone?” So yes, it took off post-2008 on one level, but on another it’s part of something much bigger – the dismantling of the twentieth century compact between social democracy and capitalism, and the concentration of power, decision-making and wealth among a small group of financial insiders.

As for whether it will continue. I started out thinking the wheels were falling off. PE took $1.5 trillion more from its investors than it generated in returns between 2017 and 2023. When you account for the steep fees charged, there’s a good argument that private markets have not really managed to outperform the stock market. And funds are sitting on companies they’re struggling to exit, resorting to Byzantine instruments like net asset value loans and payment-in-kind loans.

But I think that assuming this will have some existential bearing on the fortunes of PE is a little optimistic. The success of PE has less to do with actually generating returns than with its closeness to government and its ability to manufacture consent amongst its investors. For a long time, institutional investors such as pension funds were happy to pay proportionally more for private equity because having money locked up in private markets buffers you from the ups and downs of the stock market. And now there is an attempt to push further into the finances of everyday people through pension savings. The industry’s ability to access new pools of capital is largely determined by its political relationships. Both in the UK and US, governments are making the argument that more of our retirement savings should go into private markets – an argument very favourable to the industry. That’s ultimately why, even though the wheels look to be falling off in some respects, the success of the industry arguably has more to do with accessing new inflows of capital than with value creation.

JJ: The book focuses a lot on the US, but Britain is unusual, as you reference, in being a kind of experimental laboratory for PE. It has an unusually permissive takeover regime. Successive governments have refused to introduce public interest tests that are commonplace in other countries, which means that UK companies and infrastructure are perpetually available for acquisition. Why has that been so politically durable across governments?

HOB: I’m reluctant to reduce this to American PE funds preying on British assets, because I think it’s more complex. PE is an American invention in an important sense. It would have been impossible to imagine it emerging as it did outside the context of 1970s America. But now the model has been copied and mimicked by everyone from sovereign wealth funds to pension funds. As I put it in the book: one country’s pension provider is another country’s financial predator.

There are specific reasons why Britain has remained attractive. You’re right that there is a very permissive takeover regime. When I was a reporter covering competition policy it frustrated me enormously that a public interest test would be applied far more readily in France than in Britain, where its scope has been narrowly restricted. You can see this more broadly in how the Monopolies Commission (1973) quietly removed the word ‘monopoly’, arriving eventually at the Competition and Markets Authority (2013). Britain has really adopted the legal and economic principles born in America, which shifted competition law from intervening to protect genuine competition against entrenched power, to seeing law as a tool for insulating markets from democracy. That’s a missed opportunity, though there have been exceptions. And yet alongside that sits this narrative that a lighter touch on competition enforcement will boost economic growth – a completely credulous view that plays to the interests of entrenched power.

Another factor is that there are a lot of undervalued companies that have struggled to access capital because of a declining stock market and the drift away from any sense that pension funds ought to invest in UK equities5. That has left many companies either listing elsewhere or being snapped up and taken private. Ensuring companies can access capital to invest in productive activity would make them less undervalued and less attractive to buyout. It’s more complex than simply a vassal state story, though I agree with aspects of that framing.

JJ: I want to talk about the significance of debt. PE borrows to acquire, it loads debt onto companies, and those companies’ future earnings service that debt. What’s the significance of that process?

HOB: When you look at a company like Thames Water, we’re now living in that future that was mortgaged. The company is effectively insolvent because of all the debt taken out not to invest in productive capacity but to enrich a small group of shareholders and financiers. It raises very difficult questions about who deals with the problems that creates, because it becomes extremely expensive to untangle an asset from all those claims on its future.

It’s highly political. There’s a brilliant paper by Carolyn Sissoko6 that traces this really effectively - the way this uses a company’s debt-servicing capacity with no bearing on the broader benefit to society, and how different that is from what the managerial corporations of the postwar era were doing when they raised money to reinvest in the corporation itself. It amounts to a gigantic wealth transfer. Which is why the financial academic Ludovic Phalippou rightly calls PE a “billionaire factory”.

JJ: Circling back a bit, I wanted to ask about the push to direct pension savings into PE funds. The industry frames this as broadening access to returns, but it’s also an attempt to neutralise opposition by converting critics into participants. The parallel with Right to Buy comes to mind, and the way Thatcher converted renters and working-class people into a political project through council house sales. ‘Democratising’ PE seems to be doing something similar, i.e. converting workers into notional co-investors and making the political question of who owns what, and on what terms, harder to define. Is that too cynical?

HOB: When I hear the word ‘democratisation’ used in this context, it almost invariably refers to something that has nothing to do with democracy. It’s a fancy way of saying a group of people have found a new way of harvesting an even greater share of society’s wealth for themselves. The effect is also like buying an insurance policy for the industry itself. The more entwined you are with the finances of a nation, the more likely you are to be afforded a bailout if something bad should happen. So no, I don’t think it’s too cynical. The intention might not be to modify opposition, but the effect is to create coalitions that are difficult to untangle, at least rhetorically. You hear it constantly: you can’t do this, because what about people’s pensions?

If you drill into the actual numbers, the returns from PE really aren’t as good as they’re cracked up to be. Despite this, pension funds historically kept queuing up to invest. I think there are a few factors to explain this. Some pension funds are now asking questions and putting pressure on PE firms to release them from various agreements. But there’s also a set of behavioural biases at work. It’s more fun to invest in PE - as an investor in a PE fund, you hear about all these different companies and industries you’re ostensibly helping to improve; you get wined and dined at swanky conferences; and you can tell your investment committee things went really well, because you never have to take markdowns on assets that aren’t listed and therefore never really subjected to a market test. Those factors combine to produce a kind of behavioural failure at the level of individual incentives.

JJ: Is there any realistic alternative to PE? The story of what’s happened in Manchester is exciting, but it’s more complicated than just nationalising buses - and think tanks like Common Wealth have done valuable work proposing solutions. But I’m more interested in the transition. How do we get from where we are to something different? You can’t simply say you don’t like PE if PE is the only vehicle capable of mobilising capital at scale.

HOB: The sectors that PE has found its way into in the UK have explosive political potential to mobilise people, e.g. water, housing, care. These are things that people really care about regardless of their politics, things they depend on in everyday life. Not just thinking about PE specifically, but more generally: how do you build a progressive politics aimed at improving people’s lives? It starts with public services at the level that people experience them, and thinking about genuine affordability. There’s a book called When Nothing Works7 that looks at the portion of household income spent on services that are being massively commodified and therefore increasingly expensive, really exacerbating the cost-of-living crisis. I think that’s a good starting point - not just for resolving the issues I document in the book, but for more generally thinking about how you improve people’s lives and build a politics of progress and hope.

There are also more technical questions to do with law. There are a set of questions about limited liability, and about whether a PE fund should be held responsible for the debts it loads onto other companies, though that would be difficult to administer specifically around PE. But there are important questions to ask about the way this industry is a form of legal arbitrage that looks for loopholes and exploits them.

What I think is inadequate is to segment off one aspect of these problems as just being about PE, because what I write about in the book touches on a much bigger political failure and a broader set of issues around the model that has brought us to a point of public austerity on the one hand and private extravagance on the other. You need a politics much more concerned with holistic questions of improving people’s lives.

It’s about making people active participants in that project rather than passive recipients of things done to them. I wrote about Becky Malby, an organiser in Yorkshire who led an incredible campaign to hold the environmental regulator in the water system to account. She told me that you have to find ways for people to be “active participants in their future,” not just tell them stuff and dictate to them. I think that’s really important. And there is so much explosive potential there, given the public anger around the depletion and expense of basic services in Britain.

In the month where the world’s first trillionaire consolidated a fortune that defies comprehension, we published new research on how wealth inequality is shaping the world around us, and considered how a new Government might meet the challenges of wealth inequality.

Growing up in the Unequal Kingdom

This month, we published new research that brings the consequences of wealth inequality into perhaps its sharpest relief: namely, what it means for children growing up in it.

Growing Up in the Unequal Kingdom, authored by Anita Sangha, draws on a rapid review of 21 peer-reviewed empirical studies to examine what children understand about economic inequality, how they respond to it, and how those responses change with age. We find that older children, drawing on more sophisticated moral reasoning, are more likely to perceive both advantageous and disadvantageous inequalities as unfair, and are more likely to support redistributive strategies.

Meanwhile, some research suggests that children from poorer backgrounds are more critical of the rich, while other studies find that those from wealthier backgrounds are more likely to express concerns about violations of social hierarchies. When people are placed in situations where resources are distributed unequally, they tend to behave in a less generous way, donating less to those in need. Older children are less likely than younger children to act selfishly when inequality benefits them, suggesting that moral development can partially offset this effect.

All in all, the evidence suggests that economic inequality shapes moral development from an early age, and does so unequally.

Read Anita's report

Wealth and power: A view from the Resolution Foundation

This month, Will sat down for an engaging conversation with Mike Brewer, Deputy Chief Executive at the Resolution Foundation, on what we should actually be worried about when it comes to wealth inequality, and why conventional measures tell only part of the story.

For decades, relative wealth inequality in the UK has barely moved, a fact that leads some commentators to conclude there is no problem to solve. Mike’s view is that this reading misses the bigger picture: at the same time as relative inequality has been broadly static, the total amount of wealth in the economy has grown rapidly, producing a growing absolute wealth gap that definitely is a problem.

“An extremely unequal society with hardly any wealth might pose no problem at all. But a society with a lot of wealth that’s badly distributed should worry you, because the sheer size of wealth, in pounds, that rich people hold lets them do things others can’t. Wealth is only useful when you use it, so the gap that matters is the gap in spending power".

At the extreme end, Mike’s concern shifts from the distributional to the democratic. With extreme wealth comes extreme power. If your wealth is meaningful as a fraction of the economy, you can intervene in ways no one else can, through economic as well as political power. That includes the capacity to bend markets, shape competition law, and lock in the returns from rent and monopoly. AI, Mike argues, is likely to make this worse, placing even more transformative capability in the hands of those who already hold most of the assets.

Read the full interview

Breaking the link between wealth and health

Running alongside these conversations about the concentration of wealth is the well-documented problem that where you end up in the wealth distribution has a profound effect on how long you live, and how well.

In early June, Jason wrote about why the Fairness Foundation is backing the Health Equals campaign for a strengthened Health Bill. It follows the publication of research from the Health Foundation in April revealing a fall in healthy life expectancy in the UK of about two years between 2012–14 and 2022–24. People in the poorest areas of England live around 18 fewer years in good health than those in the wealthiest areas.

These are not separate phenomena. Our Wealth Gap Risk Register documents more than 40 impacts of the wealth gap on society and the economy, the majority of which affect health directly or indirectly. For those at the bottom end of the wealth distribution, the absence of assets and the presence of poverty have acute impacts on mental and physical health through stress, poor living conditions, and exposure to financial shocks such as ill-health or redundancy. Unlike wealthier households, those with little or no wealth have no buffer, and bear the full weight of the consequences.

Our previous polling reinforces the public mandate for action: 58% of people say wealth inequality has a negative impact on physical health. The case for tackling the social determinants of health, and for doing so through a Health Bill with genuine teeth, has never been stronger.

Read the full piece here

The world’s first trillionaire

The backdrop to all of this was difficult to ignore. This month, Elon Musk became the world’s first trillionaire, a number so large that, as Will wrote for Transforming Society, is almost impossible to imagine - a trillion seconds is more than 31,000 years.

The temptation is to treat it as a curiosity, a story about one unusually driven man. Will’s argument is that it is anything but. Billionaires in the 1980s owned the equivalent of 3% of global GDP; today’s billionaires own 17%, and this share is still growing rapidly. The problem is not simply that fortunes have grown so large, but that so much of this wealth is, on examination, unearned.

A great deal of wealth accumulation in recent years has come from passive gains such as property and pension revaluations, rather than from active saving or asset acquisition. An increasing share is extracted rather than created, accruing not from adding value, but from capturing it through rent-seeking, land price inflation, and market power, trends that we have explored in recent research.

The consequences compound across every domain, from the health of our economy to the functioning of our democracy. Will’s piece sets out three types of policy response (redistribution, pre-distribution, and guardrails), and makes the case that we have no shortage of options if we truly want to tackle these challenges.

Read Will's blog post

And in case you missed it…

Our Head of Politics and Advocacy Jason recently joined Vanessa Feltz on LBC to talk about Musk’s new trillionaire status and how Government can back the wealth creators while reducing inequality:

Where does inequality fit in the Burnham programme?

Finally, it’s impossible to discuss this month without touching on the Prime Minister’s resignation, and the likely arrival of Andy Burnham MP as Prime Minister. It’s encouraging that the new MP for Makerfield has put inequality at the heart of his critiques of other current assessments. There is little doubt that the next Prime Minister will want to go beyond the fact that inequality is getting worse, and grapple with why exactly that has been allowed to be the case. Our recent work explored some of the factors driving that inequality in the form of asset inflation, rentierism and the privatisation of public wealth. As we have explained, those factors are not only driving acute inequality, but also holding back growth in our economy.

Burnham’s commitment to deeper regional devolution, his desire to invest in productive capacity and make the tax system fairer, and his instincts towards the public and civic ownership of utilities, transport, and key infrastructure all have the potential to address some of the deep structural challenges facing our economy. What is needed now is a policy programme that is bold enough for the scale of those challenges, and that can be implemented with the necessary urgency. We wait with interest to see what he says on the economy in his speech today…

For more reflections from Andy Burnham MP on a fairer economy, you can also catch up with our interview from March here:

If you’d like to discuss any of this month’s work, collaborate on future projects, or share your reflections, do get in touch.

For several decades, the standard measures of wealth inequality in Britain have barely moved, which has led some to conclude that wealth inequality isn’t a problem worth worrying about. Mike Brewer, Deputy Chief Executive at the Resolution Foundation, thinks that this reading of events misses the bigger picture. I sat down with him to talk through what we should actually be worried about, from the absence of wealth at the bottom of the distribution to the billionaires at the top, and how to persuade policymakers of all political persuasions of the urgent need for action.

Should we worry more about the relative gap in wealth, or the absolute one?

Our view at the Resolution Foundation started from the particular circumstances of the UK, not from a philosophical position. The striking observation is that for 30 or 40 years, relative wealth inequality has barely budged. It fell for most of the 20th century, bottomed out in about the late 1970s, and has stayed flat since. People conclude that if it isn’t going up, maybe it isn’t a problem.

But at the same time as relative inequality has been broadly static, the total amount of wealth in the economy grew almost continuously from the 1980s to at least the financial crisis — and that produces growing absolute wealth gaps, which definitely are a problem. So you need both lenses at once; either on its own doesn’t tell you enough.

An extremely unequal society with hardly any wealth might pose no problem at all. But a society with a lot of wealth that’s badly distributed should worry you, because the sheer size of wealth, in pounds, that rich people hold lets them do things others can’t. Wealth is only useful when you use it, so the gap that matters is the gap in spending power. A trick we borrow from the late Sir John Hills is to express wealth gaps as a multiple of typical earnings or household spending: it captures just how much more the wealthy can do than everyone else, and how long it would take someone to work their way up the wealth distribution. The wealth gap between the top wealth decile and the fifth wealth decile increased from 38 times typical full-time earnings to 52 times between 2006-08 and 2020-22.

And at the very extreme — the billionaire end?

That’s a different kind of concern from our traditional worry at the Resolution Foundation about the top 10 or 20 per cent. With extreme wealth comes extreme power. If your wealth is meaningful as a fraction of the economy, you can intervene in ways no one else can. I don’t just mean political power; I mean economic power too. You can see it with some tech billionaires: if they decide something should happen, it happens, almost regardless of the underlying economics. In a capitalist economy, that much wealth lets you bend the rules or ignore the constraints that the market would otherwise place on you.

It’s possible that the highly disruptive power of AI, combined with extreme wealth inequality, means that very wealthy people will have the power to do even more; it’s not so much that AI is the problem here, but such disruptive (but also expensive-to-develop) technology could make the problem of wealth inequality even worse. And in a more uncertain, more disruptive world, financial resilience matters more, and wealth is the best form of resilience. So an unequal wealth distribution plus lots of disruption is likely to mean that people will feel the shocks from any future technological revolution very unequally.

Is the core problem inequality of outcome, or unfairness?

It’s both. There’s a well-established argument — Joe Stiglitz made it powerfully for the US — that very high incomes and wealth distort the economy: when the prizes are huge, people spend their energy protecting their gains rather than creating value, and then use their money to buy political clout to lock those gains in, by shaping competition law or protecting the rents they extract.

But that’s a problem confined to the very top — the top half a per cent or so. I’m also concerned about inequality across the whole distribution, not just the top half a per cent, because of the way it affects social mobility. People who accumulate wealth tend to use it to help their children — that’s human nature. Whether through bequests, or private tuition, or moving to the right catchment area, or buying your adult child a flat in London, wealth gets transmitted between generations and stacks the odds for the next one. The more wealth there is, the more it matters who your parents are. This isn’t just Piketty’s worry about trust-fund kids at the very top; I’m just as concerned about someone at the 80th or 90th percentile of the UK wealth distribution using their wealth to give their children a leg-up in ways that are unaffordable for someone in the bottom half.

On fairness, the public’s instincts don’t always match an economist’s. People do tend to think income from work is fair — high salaries are justified if you’ve earned them. And they’re deeply attached to passing on wealth: the strong opposition to inheritance tax comes from a feeling that it’s your right to leave what you’ve accumulated to your children, and they see no unfairness in it, despite how much it skews the odds. The public may accept that the very extremes look unfair, but they seem fairly relaxed about millionaires if the money was earned.

Where does relative poverty fit into the picture?

There’s an old criticism that relative poverty is just income inequality by another name — mathematically that’s roughly true, and I actually don’t have a problem with such a characterisation. I’m very happy to accept that poverty is a relative concept; that goes back to Adam Smith — what people expect as a reasonable standard of living depends on society’s overall resources. So I have no problem with relative poverty being a measure of bottom-half income inequality by another name.

The same logic applies to wealth. In the UK we have a real problem in the bottom-half of the wealth distribution: far too many people have no wealth, or negative wealth. The difference between having nothing and having even one or two thousand pounds is enormous — far bigger than the difference between £10,000 and £20,000. With no cushion, you’re acutely vulnerable to any shock, and that insecurity shapes the choices you make at work and at home. Median wealth in the bottom half is close to zero, so I do think relative wealth poverty – or some focus on the bottom half of the wealth distribution, and not just the top - is a sensible thing to measure.

Which is why you support a Citizen’s Inheritance?

Yes. Too many young people have no wealth at all. The jump from nothing to £10,000 gives you a cushion: it lets you make different choices about education, brings you a couple of years closer to being able to put down a deposit on a home, maybe lets you feel able to start a family earlier. Even if it’s not transformative, even if it doesn’t let you buy a house the second you turn 18 or 25, it brings you closer.

And if you’re serious about wealth inequality, you have to face a hard truth. Taxing wealth only brings down the top; encouraging saving does little to boost wealth, because people don’t save much. If you actually want to lift up the bottom of the wealth distribution, you have to give some money away. The Resolution Foundation’s proposal from our original Intergenerational Commission — funding a Citizen’s Inheritance by replacing inheritance tax with a lifetime gifts tax — is a double hit: it taxes large inheritances as they’re received, and boosts those with nothing. It’s might also be more politically acceptable than simply raising income tax.

Is there an optimal level of wealth inequality that recognises both the need to incentivise and reward effort and the harms causes by the current wealth gap?

On income, there’s no strong link between a country’s overall inequality and its affluence or growth; the UK just happens to sit in the high-inequality, not-great-living-standards corner. Should we or could we try to put a ceiling on inequality? At the top end, capping incomes risks people or firms simply moving abroad. But there must be a point where most of us would agree no one needs more — and I’d locate it where an individual’s wealth becomes large enough to have a noticeable effect on the economy or on democracy. And I feel that danger point is far, far higher than any level at which we’d actually blunt someone’s incentive to work or save.

I’m wary of prescribing an ideal shape for the wealth distribution, because wealth is bound up with age and inheritances — you would have to age-standardise before comparing anything, and even then, the wealth distribution reflects the accumulated inequalities of several generations. But on top of reducing the level of wealth inequality, countries concerned about its impact could take a different approach: to make wealth matter less. Scandinavian countries aren’t necessarily more equal in wealth than the UK, but they soften the impacts of wealth inequality with strong public services and a better social safety net, as well as limits on how the wealthy can influence politics. We could go further, for example through lotteries for school or university places, to limit how far parents can buy advantage. It shouldn’t be either/or: we should be thinking about reducing the extremes of wealth inequality at both ends of the distribution, as well as taking action to reduce the harms caused by it.

How much does the thinner evidence base on wealth inequality hold us back?

We have better data on income than on wealth, so researchers tend to reach for income data, especially if their theory is vague about whether they are talking about income or wealth. That should spur us to collect better wealth data. That said, income and wealth tend to move together, so even if you have great data, it’s tough to tease apart separate impacts.

But when it comes to making the case for action, I suspect we can be a bit more relaxed. When people come up with theories for why inequality might be damaging, I don’t think they have in mind something precise — and I mean that in a good way. The theories about why inequality is damaging rarely specify income or wealth — they’re really about inequality in command over economic resources. So whatever is linked to income inequality is almost bound to be linked to wealth inequality too, and the public treats the two as much the same thing.

What about the lack of causal evidence for the impacts of wealth inequality?

I think the evidential pluralism approach (where you set out the hypothesised mechanisms and study each link in the chain) ought to be enough. We’re never going to run an experiment to see how the UK would have turned out without the Thatcher revolution of the 1980s, which let income inequality rise massively. So we’re never going to have fantastic causal evidence at the country level. The best we can do is some descriptive evidence, or evidence about associations, at a high level, and then ideas about mechanisms — some of which we can study in detail and be more causal about, perhaps not at the national level but at the level of a town, a firm, or sometimes a more artificial environment where we get solid results. We can’t run experiments on countries; we’re never going to throw enough control factors into the regression for a quantitative social scientist to say, yes, that’s causal. But it’s not enough to rely on small-scale experimental evidence, but if that’s the only way to show causality, and you’ve also got lots of descriptive, associative and highly suggestive real-world data, then to me that’s the best chance you’ve got of making the case.

Taking a step back, there’s always going to be difficulty getting rich and powerful people to accept that there’s a link between being rich and being powerful, and that it can have damaging impacts. The quality of the evidence isn’t going to persuade those people, and when they can influence the political debate or the public narrative to the degree that they can today, maybe that’s where we should focus our attention instead.

Mike Brewer is Deputy Chief Executive at the Resolution Foundation. He was talking to Will Snell, Chief Executive of the Fairness Foundation.

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Economic inequality is unfair on everyone, but there’s little doubt that it bears down hardest on children.

As our Wealth Gap Risk Register has documented, the absolute wealth gap in the UK grew by 54% between 2011 and 2021, and wealth plays a bigger role than ever in shaping life chances and outcomes. Many have argued that the consequences of that wealth gap has a disproportionate, and particularly harmful effect on children, particularly given the context that 1 in 3 children in the UK grow up in poverty while the amount of wealth climbs ever higher.

The evidence on what the wealth gap means for uneven opportunities between children in their development is stark. Research suggests that higher levels of parental housing wealth are associated with fewer emotional and behavioural problems in children, and healthier psychological development, even after accounting for income, socioeconomic status, and family characteristics. There is also a strong positive correlation between parental wealth and children’s educational attainment, even after controlling for parental income and education levels. It’s well documented that wealthier parents can provide more educational resources and opportunities, private tutoring, extracurricular activities, the ability to fund higher education without loans, and are more likely to afford private schooling altogether. Policies that directly cut the incomes of families with children compound this further. The two-child limit was one of the starkest examples as a policy choice that concentrated its effects on some of the most disadvantaged children in the country.

Despite this impact of inequality on children, most academic research into beliefs and perceptions about economic inequality has focused on adults. Less attention has been paid to children and young people, or to how their views change as they develop morally and socially. A short report that we are publishing today, Growing up in the Unequal Kingdom, begins to address that gap. Drawing on a rapid review of 21 peer-reviewed empirical studies, it examines what children understand about economic inequality, how they respond to it, and how those responses change with age.

Read the report

The report, authored by Anita Sangha, builds on other work that examines the perceptions of young people. For example, the National Youth Strategy acknowledges the importance of economic inequalities, and the Big Ask survey by the Children’s Commissioner suggests that children want to see a fairer society. Meanwhile, a survey of 18–24-year-olds by the Sutton Trust and More in Common found that more young adults are concerned about the impact of inequality on education, work, health, and social mobility than the general adult population. A majority believed the government should do more to tackle inequalities, and that coming from a wealthy family was important for getting ahead in life.

Four findings from our rapid review of the evidence stand out:

• First, children’s understanding of inequality develops with age. Younger children tend to judge inequality as unfair mainly when it disadvantages them personally. According to Chao et al. (2025), older children, perhaps drawing on more sophisticated moral reasoning, are more likely to perceive both advantageous and disadvantageous inequalities as unfair. Meanwhile, Essler and Paulus (2021) found that older children were more likely than younger children to support “Robin Hood” strategies i.e. taking from the rich to give to the poor. Notably, Rizzo et al. (2020) found that older children asked to evaluate a resource allocation strategy that perpetuated inequalities as more unfair than younger children, even when it benefitted them personally

• Second, children’s own experiences of inequality shape their reasoning. Young people from poorer backgrounds are more critical of the rich (Mistry and Yassine, 2022), while adolescents from lower socioeconomic backgrounds are more likely than their peers to view social exclusion of the poor as unfair (Gonul et al., 2024). Conversely, children from wealthier backgrounds are more likely to frame cross-class friendships in terms of violations of social hierarchy (according to Grutter et al. 2021), reflecting how lived experience can colour moral judgement from an early age.

• Third, several studies have found that when people are placed in situations where resources are distributed unequally, they tend to behave in a less generous way, for example, donating less to children in need (Kirkland et al., 2020, 2021). This is consistent with findings from adult research: a meta-analysis of 100 studies by Yang and Konrath (2023) found a significant, if small, negative effect of inequality on prosocial behaviour. Older children were less likely than younger children to act selfishly when inequality benefitted them, perhaps suggesting that moral development can partially offset this effect, but the underlying dynamic is a concern (McGuire et al. 2019, Chao et al. 2025).

• Finally, social exclusion based on economic status provokes negative emotions in children. Older children report more negative emotions than younger children when witnessing a poor child being excluded (Dys et al., 2019). Children also expect those who are excluded to feel sadness and loneliness (Acar and Sivis, 2023). These findings suggest that children are not passive observers of inequality, they respond emotionally to it, and those responses intensify as they grow older.

Taken together, these findings suggest that the views of children on inequality should be considered more fully in the development of policies to tackle inequality. Several mechanisms exist to do this by considering the role of future generations and young people and overcome the chronic short-termism that remains endemic in our politics. For example, Wales’ Future Generations Act requires leaders across policy domains to consider the interests of future generations. Commitments to lower the voting age to 16 would give young people a more direct stake in democratic decisions. Proposals for a Parliamentary Committee on the Future, focused on long-term and intergenerational policy, would provide a formal space in which the perspectives of children and young people could inform legislative debate.

As wealth inequality looks set to deepen, the research reviewed in our new report is a reminder that children are moral agents who perceive unfairness, feel its emotional weight, and, as they grow older, increasingly believe something should be done about it. The question is whether the adults making policy are listening.

Read the report

Four years ago, we co-hosted an event on the ‘health gap’ with the Policy Institute at King’s College London. The event featured remarks by Professor Sir Michael Marmot on the acute health inequalities driving unfair outcomes across society:

“If we create a fairer society, health will improve and health inequalities will diminish. What more important task could there be before us?”

Four years later, that task remains as urgent as ever, and yet is still unfinished. In fact, by some measures we seem to be going in the wrong direction. In April 2026, the Health Foundation published new research that showed a fall in healthy life expectancy in the UK of about two years between 2012-14 and 2022-24. The evidence continues to show that people in the poorest areas of England live around 18 fewer years in good health than those in the wealthiest areas.

These health disparities don’t exist in isolation. Instead, they are compounded by a corresponding ‘wealth gap’ that has grown significantly in recent years. In fact, according to our research, the wealth gap between the top 10% and the bottom 10% in the UK increased by 54% between 2011 and 2021 (from £7.5 trillion to £11.5 trillion).

A growing and convincing body of evidence reveals that the wealth gap and the health gap appear as two sides of the same coin, mutually reinforcing each other’s most damaging consequences across our economy and society. In our Wealth Gap Risk Register, we document the evidence for over forty impacts of the wealth gap, the majority of which affect health directly or indirectly through channels such as housing, labour markets, mental health and opportunity.

For those at the bottom end of the wealth distribution, the absence of assets and the presence of poverty have acute impacts on mental and physical health through stress, poor living conditions and exposure to financial shocks such as ill-health or redundancy. Unlike wealthier households, those with little or no wealth have no buffer against these pressures and bear the full weight of their consequences. In fact, research increasingly reveals how wealth inequality corrodes the building blocks of good health and undermines the conditions that keep people well in the first place.

Take housing as an example: the evidence shows that greater parental housing wealth is associated with fewer emotional and behavioural problems in children, and healthier psychological development, yet housing wealth remains highly concentrated. Or consider debt: people on lower incomes are significantly more likely to be in problem debt, creating chronic stress that can trigger depression and other adverse mental health consequences. Wider economic disparities can also be linked to mental health challenges, as economic inequality tends to amplify concerns about social standing and relative status, increasing anxiety and other psychosocial problems.

Most strikingly, the gap in healthy life expectancy is profoundly shaped by socioeconomic factors. People in poorer communities spend a substantial part of their lives dealing with long-term illness and disability, and the evidence shows that low levels of wealth are strongly linked to higher risks of death and disability among older adults.

The public, meanwhile, understands these inequalities as deeply unfair because they create an uneven playing field between people. In July 2024, we commissioned Focaldata to run a poll with a representative sample of 2,012 people from across the UK to build an understanding of peoples’ perceptions of wealth inequality and its consequences. We found that 58% say that wealth inequality has a negative impact on people’s physical health, with only 11% believing it to have a positive impact. This echoed our previous polling in 2024, in which 70% of respondents identified inequalities in health and life expectancy as a big or moderate problem. And a poll that we ran with Opinium in 2023 found that 50% of people believe that their or their families’ health has been negatively affected by their economic situation, while a similar proportion cite the negative health impacts of their job.

What we’re calling for

This public mandate for action must now be met with political will, in order to meet the challenge set by Professor Marmot and many others. In response to that challenge, we’re proud to play our part in a coalition of over 100 organisations, led by Health Equals, calling on the Government to strengthen the Health Bill.

Specifically, we are backing the call for improved duties in the Bill to reduce health inequalities, alongside a requirement for the government to publish a cross-government strategy with clear targets and accountability, cementing action on health inequalities in law.

Of course, this legislation alone will not be entirely sufficient. Alongside these changes, we need to go further to tackle extreme wealth inequality and we need to see bolder action from the government to address its consequences. That means dealing with the lack of assets at the bottom of the wealth distribution that are pushing people into insecurity and precarity, and giving more people chances to build ordinary levels of wealth. It also means addressing the concentration of wealth, and the power that concentration confers on a tiny number of people in our society, ensuring that everyone fairly contributes based on their means.

These are long-term challenges. Yet while the UK state is notoriously short-termist in its approach to policymaking, they must be addressed without any further delay. Labour’s manifesto rightly pledged to “tackle the social determinants of health, halving the gap in healthy life expectancy between the richest and poorest regions in England.” The government now has a genuine opportunity to make that historic change, by building communities where wealth does not determine health and creating a society and economy that is not only healthier, but fairer as well. That opportunity must not be wasted.

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This month we ranged across three distinct but connected aspects of the fairness debate. Our new report, Takers, made the public and political case for action on wealth extraction, arguing that Britain’s economy has drifted from rewarding contribution to rewarding the ownership of assets. A second guest piece by Charlie Chan challenged the stories that professionals tell about places, and what we miss when we look at communities. And a dispatch from the University of Bristol offered eleven findings from the frontier of research into how people actually think about fairness and inequality.

May saw our publication of Takers, a report that sets out the scale of the public and political mandate for action against wealth extraction and examines the policy arguments in detail. Released the day after the Sunday Times Rich List, we showed that not all wealth is made equal and that the public, and our policymakers, have very strong perceptions about what constitutes fair wealth.

The report built on Will Hutton’s paper from March, Escaping the State We’re In, which made the case for rediscovering the distinction between value-adding wealth creation and value-draining wealth extraction. We argued that Britain’s economy has, over decades, shifted away from rewarding productive contribution, innovation and entrepreneurship, and towards rewarding the ownership of assets and the extraction of rents. The four pillars of this extraction economy (asset inflation, rentierism, market concentration and financialisation) have combined to create an economy that no longer works for working people.

The report draws on original polling that we commissioned earlier this year to show that the public already grasps this distinction. Voters do not treat all fortunes as equivalent, but instead support the idea that genuine innovation and entrepreneurship should be rewarded, while wealth accumulated through the ownership of scarce resources, whether housing, land, infrastructure, is a different matter. That dividing line in public attitudes, the report argues, can be harnessed by any political party that is willing to build a serious policy agenda around it.

Takers reinforces the arguments in the recent Labour Growth Group report An Honest Day, which convincingly articulated the need to back those who contribute to society and restore the link between effort and reward.

Read Takers

This month we also published a second article from Charlie Chan, Director of United Communities, which reflects on her own experiences and documents the personal impacts of policy decisions. Charlie’s first piece for us, Policy is personal, was published last month, and traced the intersections of housing benefit, tax credits and statutory maternity pay as experienced from the inside, and reminded us that fairness, in the end, is judged from the perspectives of those most affected by policy. Her second piece, The stories (not) told about places, explores her own experience in honest emotional depth.

Charlie recounts her experience of being forced by the prospect of eviction to accept a property she hadn’t bid for, on the estate she had written off. On that estate, Charlie tells us she found something entirely different from what her professional training had prepared her to see in the generosity and spirit of the community.

“I began to discover that community assets aren’t confined to a place database, and likely don’t have a website, but it is these often invisible assets that hold community together. That discovery changed how I see everything. People. Policy. Places.”

What makes this piece worth reading alongside the policy analysis elsewhere in our work is the honesty of its challenge. As a professional, Charlie was trained to look for problems, but as a neighbour, she learned to see possibilities. It’s a clear-eyed reflection on the failure of policy to see the reality of places.

Read Charlie's piece

Our final piece of the month reported back from an intensive one-day workshop at the University of Bristol, the BÆM Meeting on Fairness in the Economy, which brought together eleven experts from Zurich, Bergen, St Gallen, Oslo, Amsterdam, LSE, Princeton, Berlin and Cambridge to present the latest research on how people think about fairness and inequality. The findings are rich, and some of them cut across the grain of familiar assumptions.

On the question of why redistribution varies so dramatically between countries, Morten Støstad’s analysis of 92,000 people across 40 nations suggests that the most redistributive societies, including the Nordic countries, are not necessarily the most altruistic. They are the ones most convinced that unchecked inequality is bad for social cohesion, trust and growth. On the question of how inequality is perceived, Joël van der Weele’s research finds that the choice of metric shapes public attitudes significantly: people who hear about the top 10% income share think inequality is higher, less fair and more in need of correction than those who hear about the Gini coefficient.

Paolo Brunori’s European survey data shows that people’s perceived inequality of opportunity has been rising over time, and that support for redistribution is likely falling not because people have stopped caring, but because they have lost confidence that government can do anything effective about it. Simona Sartor’s experiments demonstrate a phenomenon that she calls “aristocratic meritocracy”: people who believe hard work should be rewarded tend to extend that principle to inherited wealth too, on the grounds that it represents the hard work of previous generations. And Ranveig Falch’s study of 14,000 Americans and Scandinavians finds that almost nobody thinks pure self-interest is morally acceptable, but most people think some degree of self-prioritisation is fine, and that stripping away the justifications (the invisible-hand argument, or reciprocity) causes approval to drop sharply.

Taken together, the eleven presentations offer valuable and important lessons for those of us working on wealth and inequality, particularly on public perceptions.

The workshop was organised by Paul Hufe at the University of Bristol, with funding from an UKRI Future Leaders Fellowship (ref MR/X033333/1), as part of a series of Bristol Applied Economics Meetings.

Read the full piece

If you’d like to discuss any of this month’s work, collaborate on future projects, or share your reflections, we’d love to hear from you - just reply to this email.

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The BÆM Meeting on Fairness in the Economy brought together eleven speakers across a single intensive day at the University of Bristol in May 2026. Speakers from Zurich, Bergen, St Gallen, Oslo, Amsterdam, LSE, Princeton, Berlin and Cambridge presented the latest evidence on what people believe about the causes and consequences of economic inequality and how it relates to fairness considerations, and how those beliefs shape policy preferences. The findings are a gold mine for researchers, policymakers, journalists and campaigners alike.

The usual debates about equity versus efficiency or the size of the state barely surfaced. What came through instead was a more textured picture: a public that cares about consequences as much as about justice, that reads inequality through whatever lens its media offers, that accepts inherited wealth as partially fair, and that is losing faith in the state’s ability to fix any of it.

This workshop was organised by Paul Hufe at the University of Bristol, with funding from an UKRI Future Leaders Fellowship (ref MR/X033333/1), as part of a series of Bristol Applied Economics Meetings. The titles of sessions have been simplified – see the workshop programme for the actual titles used. The research presented at the workshop is all ‘live’ and yet to be published, so we cannot provide links to more information on the specific research projects mentioned below, but you can click on a presenter’s name for more information about their overarching research.

Ernst Fehr (Zurich): What do laboratory measures tell us about the real world?

For decades, economists have used simple lab games to measure how much people care about others. Fehr (with Epper and Senn) builds on his seminal 1999 paper with Schmidt (A Theory of Fairness, Competition, and Cooperation) to show that most studies into the effect of social preferences on economic outcomes have only looked at one half of the picture. Many studies use a classic ‘dictator game’ design to measure altruism and social preferences, where one player (the dictator) decides how to split an amount of money with a second player (the recipient) who has no input into the decision. Most studies of this kind measure altruism without differentiating between ‘aheadness aversion’ (whether people dislike being far ahead of others) and ‘behindness aversion’ (whether people also dislike being far behind others). However, when you measure both, you find that people who dislike being ahead of others tend to be less concerned about being behind others, and vice versa – the two are negatively correlated. Properly understanding this has important implications for understanding how people think about contributing to society versus their own financial insecurity, which has consequences for real-world behaviours such what jobs people choose, what causes they donate to, and how they vote.

Morten Støstad (NHH Bergen): Why we really redistribute

Why do some countries tax more and redistribute more than others? The usual answer is that some societies are simply more fair-minded. Støstad analysed surveys of 92,000 people across 40 countries and found something else going on. The countries who redistribute most – such as Nordic countries - are not necessarily the most altruistic. They are the ones who believe that inequality damages society, by undermining trust, fuelling crime, weakening cohesion or slowing growth. He calls this “self-preserving redistribution.” About 77% of respondents agree that economic inequality leads to social unrest. Globally, around 48% redistribute for fairness reasons and 23% redistribute for self-preserving reasons (more in the Nordics). The Nordics, in other words, are not unusually generous; rather, they are unusually worried about what unchecked inequality might do. The other implication is that consequentialist arguments - that inequality has measurable negative impacts - may be more politically effective than fairness-based ones in winning the argument for action on inequality.

Paolo Piacquadio (St Gallen): Why position matters more than money

How much economic efficiency are people prepared to give up in order to make their country more equal? Piacquadio (with Bos, Drupp and Groth-Pettersen) designed an experiment where participants chose income for themselves and a group of others, allowing them to separate people’s altruistic concern for others from their views on redistribution. The most striking finding is that when people care about inequality, they care more about who is ranked above or below them than about how much money separates them. Climbing or falling in the ranking matters more than the absolute size of the gap. Economists usually ignore rank-based concerns. Piacquadio argues they shouldn’t, because these concerns shape how people actually feel about a society’s distribution.

Ranveig Falch (Oslo): When is selfishness OK?

Falch (with Cappelen, Sørensen and Tungodden) asked 14,000 Americans and Scandinavians whether it is morally acceptable to put your own interests first. Almost nobody thinks pure self-interest is fine, but almost everyone thinks some prioritisation of your own interests is acceptable. The justifications fall into two camps: an invisible-hand argument (self-interest serves the wider good) and a reciprocity argument (others are selfish, so I can be too). Strip those justifications away, for instance in a simple ‘dictator game’ where one person decides what to share with another, and most people switch to disapproval. Context matters: self-interest is more acceptable in markets and voting than in family life or the workplace. Americans are more tolerant of self-interest overall, except — surprisingly — in markets and voting, where Scandinavians are more tolerant.

Joël van der Weele (Amsterdam): How you measure inequality changes what people think about it

The same level of inequality can be described in multiple ways. Common examples are the Gini coefficient (a single statistical measure of the level of inequality in a country), the share of income held by the top 10%, the share held by the bottom 40%, and the Palma ratio (comparing the top 10% share with the bottom 40% share). Van der Weele (with Sund and Siniakova) shows that the choice of which metric to use when describing the level of inequality in a country has a bearing on how people think about the issue. People who hear about the top 10% share think inequality is higher, less fair, and more in need of correction. People who hear the Gini think the opposite. The effect is roughly the same size as noticeable differences in the level of inequality between countries. Experts are not immune to their perceptions of inequality being influenced by the choice of inequality metric. A media analysis across eight countries found that left-leaning outlets prefer to talk about top income shares, whereas right-leaning outlets reach for the Gini. Some of the political divide over inequality may therefore be a statistical artefact.

Paolo Brunori (LSE): What people believe about inequality has little to do with what reality

Brunori (with Hunewaldt) looked at survey data across European countries and compared what people think about inequality of opportunity to what economists actually measure. The two barely match. Perceived inequality of opportunity has been rising over time; actual inequality of opportunity, by most measures, has not. People who feel inequality is unfair tend to support redistribution, but those feelings may be shaped by personal experience more than by actual economic conditions. Although Europeans feel more strongly that opportunity is unequal, support for redistribution is falling. The likely reason is not that the public no longer cares, but that people are losing confidence that government can actually do anything useful about it. And correcting people’s misperceptions of their own position does not necessarily change their level of support for redistribution.

Magdalena Wasilewska (Amsterdam): The stories we tell about inequality

When you ask Dutch citizens to explain why some people are rich and others are poor, about 62% point to structural causes (the labour market, the tax system), 26% point to personal effort, and 16% to luck. Wasilewska (with Douenne, Sund and van der Weele) finds that the structural explanation is more common among women, the more educated, and the left-leaning. Telling people a different story – for example, that success is mostly about hard work, or that it is mostly about family background - does shift their views about meritocracy, but has little impact on their support for redistribution. People are also very good at picking out the explanations that fit what they already believe. So the chicken-and-egg question is left open: do the stories we hear shape our beliefs about fairness, or do our beliefs determine which stories we accept?

Ingvild Almås (Zurich): Measuring unfair inequality, not just inequality

Most measures of inequality (like the Gini) ignore an important question: was the inequality earned fairly or not? Almås (with Hufe and Weishaar) is building a new measure that puts this question front and centre. People are asked to look at imaginary mini-societies, estimate the size and income of different demographic groups, and to say what each group’s fair income would be. The gap between fair and actual income becomes the new measure of unfair inequality. A US pilot with 2,300 people found that Americans underestimate both inequality and unfairness, but believe there is more unfairness than inequality. That implies either that there is a degree of perceived unfair equality (i.e. some people being compensated more than others think that they deserve to be), or that the wrong people are being compensated. Americans, on average, would give up 8% of their perceived income to live in a fairer society. The research is now being rolled out to 35+ countries.

Roland Bénabou (Princeton): When do good ends justify bad means?

Most behavioural economics focuses on how people balance their own interests against others’ interests. Bénabou (with Henkel and Falk) tackles a harder question: how do people balance ends against means? They asked 500 participants to make five decisions, including whether they would lie for a good cause or pay a bribe to achieve the right outcome. They found that between 20% and 44% of people refused to subordinate means to ends across the various tasks, preferring to act in the ‘right’ way even if it came at the cost of the best result, but a majority were prepared to act more nefariously to achieve a good outcome. Strikingly, almost no one was consistently Kantian (means-respecting) or consequentialist (ends-justifying). People shift their answers depending on the scenario, which is unusual; when economists study self-versus-other choices, individual behaviour is much more stable. And the means-respecting people are not more “moral” overall: their refusal in to subjugate means to ends does not predict their generosity in standard sharing games.

Simona Sartor (HU Berlin): Inheritance, luck, and “aristocratic meritocracy”

If hard work deserves a reward, what about your parents’ hard work? Sartor’s experiments in the US put participants into the role of social planner and ask how much tax should be applied to income from four sources: people’s luck, their own hard work, inherited wealth that arrives by random chance, and inherited wealth that comes from their family’s hard work. She calls the result “aristocratic meritocracy”: people who think that hard work should be rewarded and not highly taxed also think that this holds true if the hard work was done by the parents of the person in question. In other words, people think that inherited wealth is at least partially deserved. This holds even when the role of luck is made obvious to participants, and despite the fact that respondents identified birth circumstances, family background, genetics and personal traits as among the most luck-driven factors in life. Plug the implied preferences into an optimal-tax model and the ‘fair’ rate of US inheritance tax should be about 41%, far below the 65% that a strictly meritocratic view would imply, and remarkably close to the 40% top rate of inheritance tax that applies in the US today.

Kristoffer Berg (Cambridge): What kind of meritocracy do we want?

Berg (with Håvarstein and Stubhaug) asks: if we want a tax system that holds people responsible for their merits but not their circumstances, what do we even mean by merit? He presents two alternatives. The strict version says that only the part of income that cannot be explained by circumstances should count as merit. The looser version says that the part explained purely by merit counts, even if circumstances would have predicted it too. Looking at Norwegian wages, the strict version finds that only 15% of wages are due to merit; the looser version finds that 40% of wages can be attributed to merit. Building this into a standard optimal-tax model produces very different policies: the strict version calls for more progressive taxes than a pure utilitarian benchmark, while the looser version calls for less progressive ones. Either way, meritocracy as measured has been rising in Norway since 1958.

Today we’re publishing a report, Takers, that sets out the scale of the public and political mandate for action against wealth extraction, as well as examining the policy arguments. You can read the report online or as a PDF.

Read the report

At their best, well-run capitalist economies are engines of extraordinary value generation, rewarding productive contribution, innovation and entrepreneurship. Through risk-taking, enterprise, and investment, those economies produce goods and services that improve people’s lives. However, as the Labour Growth Group recently articulated in An Honest Day, economic activity in the UK has increasingly moved away from rewarding wealth creation in the economy in favour of rewarding those who extract wealth and value. Our recent paper by Will Hutton, Escaping The State We’re In, makes a similar argument that we must ‘grip the reins’ of capitalism more firmly, by mobilising investment, disciplining extraction, rebuilding state capacity and aligning growth with the common good. And Stewart Lansley wrote about the same issue last week in Labour List, arguing that “Keir Starmer rightly talks of the need for ‘wealth creation’, but draws no distinction between activity that serves the common good, and growth-sapping ‘appropriation’ aimed at diverting the gains from economic activity”.

The bias towards wealth extraction has created a deep unfairness in Britain’s economy, severing the link between contribution and reward. People who own assets - and organisations that can extract ‘rents’ from assets - have become much richer. Meanwhile, ordinary workers who play by the rules and work hard have seen their living standards decline markedly. Although some argue that benefits recipients or immigrants ‘take’ from our economy, the evidence overwhelmingly suggests that the problem with the ‘takers’ is at the top of the wealth distribution, not the bottom.

Coming hot on the heels of the publication of the Sunday Times Rich List, Takers, our report launched today, builds on original polling commissioned by the Fairness Foundation earlier this year, which found that voters reject the idea that all fortunes are alike. Instead, people support the idea that wealth creation through genuine innovation should be distinguished from wealth extraction, where wealth accumulates from the ownership of scarce resources.

This report aims to help to build a cross-party consensus on the need for bold action on two fronts: to stem the extraction of wealth from our economy, and to rebuild a society that allows everyone to contribute and rewards those contributions fairly. It sets out the level of public and political support that exists for action on wealth extraction, looking at polling evidence on attitudes to both companies and individuals, and exploring how parliamentarians from all of the major parties have raised concerns about the issue. It also discusses the reasons that wealth extraction is a problem, looking at the four pillars of the extraction economy - asset inflation, rentierism, market concentration and financialisation - and examines how policymakers can respond.

The political party that grasps the distinction between wealth creation and wealth extraction, and that builds a serious agenda around the idea that not all wealth is made equally, will find both the public and the evidence on its side. We challenge policymakers to heed this call for an economy that serves everyone, and that rewards genuine wealth creation rather than incentivising wealth extraction. The prize is a fairer country, where opportunity is available to all and contribution is fairly rewarded once again.

Read the report

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Eleven years ago, I became homeless. Again.

I was on maternity leave from my job in education. My baby was just two months old, and my eldest was nine. My husband’s restaurant, his family’s business for 40 years, had never recovered from the recession. People were eating out less. Which is, broadly speaking, bad for restaurants.

Bills became debts. Letters developed that tone. And then the bailiffs started knocking.

We sent sentimental possessions - such as my 1995 unofficial Take That annual - to stay with friends for safekeeping. We lost the once thriving business. And with it, our home above it.

Our home that once hummed with chatter and laughter from downstairs. Our home that always smelled like my favourite food (except on a Saturday night, when it leaned more towards Shiraz). And, for a brief but committed period of time, our home with polka dots on the banister. (A decision made somewhere between pregnancy hormones and a paintbrush.)

I maintained the illusion of calm. Which was quite the achievement, considering my brain had started running a nightly reel of us sleeping in a tent in the restaurant car park. To be clear, this was not the plan. Besides, the car park had a strict short-stay policy.

Between the nightmares, breastfeeding, and my Oscar-worthy impersonation of Ross Gellar’s “I’m fine”, I was exhausted. I felt like I’d failed. Which is a bold conclusion to reach when the economy has just taken your home.

In a moment of déjà vu, I found myself calling the local authority again, asking to be put on the housing waiting list. This time, I was invited to complete a homelessness application. Housing policy’s version of getting a foot on the property ladder.

There is something slightly surreal about applying for your own homelessness. I took the completed form to the housing office, along with three months of bank statements. The local authority approved it, and I joined a weekly bidding ritual – hundreds, maybe thousands, of us competing for a small number of houses.

Every Monday, I logged on and placed my three allotted bids. It was like a silent auction. Except instead of bidding on a spa day, I was bidding on a place to live.

I bid on everything. Old houses. New builds. Edge-of-town properties. Bungalows. Anything that came up. Well, almost anything. I didn’t bid on any properties on the council estate which had been built in the sixties as overspill from Birmingham. Across town, it was known as “the Wastelands”. Professionally, it was labelled “deprived”, largely thanks to its consistently high ranking on the multiple deprivation indices (not a leaderboard anyone is trying to top). I’d even worked there, years earlier. With a role title. And a lanyard. So, I figured I had a pretty good grasp of the place.

Eviction was fast approaching. I was still placing my three weekly bids. Nothing. Then, just before our eviction date, I received an email from the housing office. I had been offered a house - one I hadn’t even bid for! I couldn’t believe my luck.

Until I read where it was. It was on the “Wastelands” estate. If I turned it down, we would – quite rightly – be removed from the housing list. If I accepted it, people would describe us as “disadvantaged”, “rough”, “vulnerable”, or my personal favourite, “hard to reach.”

I was homeless. And I still found a way to be selective. That is how powerful stigma is. And how convincing a single story of place can be.

I had 24 hours to choose between stigma and shelter. Without seeing the house, I chose shelter. And what I found there changed everything.

We met our housing officer at the property. She handed us the keys, a starter tenancy agreement, a rent payment schedule, and a voucher for magnolia paint (paint policy favoured magnolia), then left us to it. My husband and I exchanged a moment of surprise… At how quiet it was. At how safe it felt. A pedestrian walkway. Houses facing each other. A shared green at the centre.

Then we met our neighbours. Chris, the mechanic next door, offered to fix my car. For free. Not because he had spare time. Because he had a skill that he was happy to share. Mo, who sits out front whenever it’s not raining, showed me how to plant when my first attempt resulted in a bed of weeds. Leanne, across the green, finished cooking my kids’ lasagne when my oven broke halfway through making tea and I had nothing else in.

We began to share what we had too. And over time, something changed. Not overnight. Not according to my “getting back on our feet” timeline. But steadily, at the speed of trust.

The story I thought I knew about that place began to fade, and I came to see that this was not a broken place, but a place full of gifts. Skills. Stories. Generosity.

I also learnt that this was a place with a brilliant sense of humour. A few years ago, a campervan blew up on the road just beyond the green (no one was in it, and it wasn’t vandalism as the local media were quick to assume). As about 50 of us gathered to watch the scene unfold, Mo turned to me and said, “this is a better turn out than the jubilee!”.

Crucially, I learnt that it was a place where abundance was weaved into the fabric of community life. Neighbours knew each other’s names. They came outside to watch thunderstorms (and campervan explosions) together. Shared tools. Passed food over fences. Looked after each other’s children, pets, and homes. Held birthday parties out front instead of in back gardens.

And somewhere along the way, it started to feel like home. I’d been there before. Just not as a neighbour. Which, it turns out, matters. As a professional, I had been trained to look for problems. As a neighbour, I learnt to see possibilities.

As a professional, I saw a young woman with four children on the estate and assumed she was “disadvantaged”. As a neighbour, I saw an incredibly capable, resourceful mum who swapped childcare with the people around her whilst she juggled two jobs. Same person. Different lens.

I began to discover that community assets aren’t confined to a place database, and likely don’t have a website, but it is these often invisible assets that hold community together. That discovery changed how I see everything. People. Policy. Places.

It also changed what I do, what I value, and how I see the world. Now, I work alongside organisations, helping them work with communities like mine. Not to fix them. But to build with them. To be good neighbours. The way my neighbours showed me.

And, perhaps most importantly, to recognise that we are the people we are talking about when we talk about community.

Policy gave me a house. My neighbours made it a home. And I still live here today. On purpose.

This piece was written by Charlie Chan, Director of United Communities, and is a follow-up to her earlier piece for us, Policy is personal. It was sparked by a conversation with Will Snell, CEO of the Fairness Foundation, at the Anthropy National Gathering 2026. Charlie was able to be at Anthropy through the generosity of UK Acumen Academy and United Learning.

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Last month we focused on the deeper architecture of inequality, considering how wealth translates into power, how Britain’s economic model entrenches rent extraction, and how the design of policy is felt in people’s everyday lives. Across four pieces, we examined wealth as freedom, the politics of rentier capitalism, why progressives need a sharper argument about wealth, and what fairness (or the lack of it) really looks like from the perspective of those affected most by public policy decisions.

In February, we co-hosted a roundtable with the UCL Policy Lab to discuss Stuart White’s new book, The Wealth of Freedom. Bringing together academics, policymakers and campaigners, the conversation took the republican idea of freedom as non-domination and asked what follows when that ideal is taken seriously in an economy marked by large concentrations of wealth.

Stuart’s contribution to Fair Comment sets out the core of his argument. Wealth, he reminds us, is power: those who lack it are more dependent on employers, landlords, creditors and the state, and therefore more vulnerable to domination. Those with extreme wealth, meanwhile, can use it to buy political influence, through party donations, media ownership or patronage, and so come to dominate the rest of us in our political life. A democracy, on this view, requires both a robust economic floor and a robust economic ceiling.

Stuart is candid that policy alone cannot deliver this. Public trust in politics is low, and the institutions needed to limit wealth inequality are themselves shaped by oligarchic power. The way out is to combine an economic reform agenda (such as universal basic income, inheritance and wealth taxes, and stronger trade unions) with a programme of democratic renewal: tightening rules on lobbying and party funding, exploring Citizens’ Assemblies, and rebuilding popular trust in the democratic state. The project of freedom and the project of equality, in short, cannot be pulled apart.

Read the full piece

In a long-form interview with our Senior Researcher Jack Jeffrey, Brett Christophers, Professor of Human Geography at Uppsala University and author of Rentier Capitalism, argues that Britain’s post‑1970s shift was not really about rolling back the state. It was an active political construction of protected zones of rent extraction in housing, land, energy, water and infrastructure. Ownership, more than markets, is the story he wants us to tell.

The interview ranges across Right to Buy, the rise of the buy‑to‑let market, and the extraordinary growth of asset managers like Blackstone, Macquarie and BlackRock as owners of British infrastructure. Brett is careful to resist an overly moralistic account: the typical buy‑to‑let landlord is on a median or below‑median income, not a billionaire, and is responding rationally to a chronically stagnant economy in which other routes to security have been largely closed off. Rent extraction is a symptom of Britain’s political economy, not its cause.

Monetary policy plays a starring role. Years of low interest rates after the 2008 crisis pushed institutional investors out of bonds and into real assets, water utilities, toll roads, housing, locking rentier dynamics into the heart of the economy. With governments now reluctant to invest publicly at scale, ministers find themselves courting asset managers to deliver climate and infrastructure investment, and quietly de‑risking their returns. Without compulsory or quasi‑nationalised investment, Brett warns, there is little credible alternative.

Read the full interview

Cross-posted with HopeWorks, this piece by Jack Jeffrey builds on our roundtable on Stuart White’s book and asks a fundamental question: why, more than a decade after Piketty, has public opinion not caught up with what we know about wealth inequality?

Jack’s argument is, in part, that progressives have leaned too heavily on statistics. Restating the numbers, the soaring share of wealth held by the top 1%, the racial wealth gap, the generational gulf, has not, on its own, produced a constituency for serious reform. Part of the reason, drawing on Mike Savage and others, is that people do not experience wealth in purely monetary terms. Wealth is associated with security, future possibility and the capacity to provide for those they love. Distributive critiques framed around fair shares struggle to connect with that.

This is where republican political theory may help. Following Philip Pettit and Stuart White, the republican tradition asks not only how wealth is distributed but whether it creates relationships of dependence and domination. On this view, having too little wealth matters because it leaves people unable to challenge a landlord, leave a bad job, or absorb a financial shock. Having too much matters because it enables a few to bend the political system to their will. That is an argument, Jack suggests, that travels better in public debate than another graph of Gini coefficients, and is one that progressives may need if they are to win the next phase of the inequality debate.

Read the full piece on HopeWorks

Our final post of the month is a guest contribution by Charlie Chan, Director of United Communities, drawing on a conversation with our CEO Will Snell at the Anthropy National Gathering. It is a different kind of piece from the rest of our April output. In it, Charlie traces her own journey through housing benefit, statutory maternity pay, tax credits, child trust funds and student finance, beginning with becoming a parent at 17 and being legally too young to enter a tenancy agreement, even as she was old enough to raise a child. The result is a portrait of policy not as something abstract or distant, but as a set of overlapping rules that quietly shape whether a young mother can find a home, hold down a job, train for a career, or have access to housing.

Two themes stand out. First, the importance of human discretion: a manager called Andrea looked past the stereotype of a teenage mum and changed the trajectory of Charlie’s life. Second, the way policies designed in isolation collide in practice, a small bonus pushing a family over a tax‑credit threshold, repayment notices that exceed the bonus itself, food banks rationed by paperwork. As we continue our work on tax, wealth and economic reform, Charlie’s piece is a reminder that fairness, in the end, is judged from the perspectives of those most affected by policy.

Read Charlie's full piece

If you'd like to discuss any of this month's work, collaborate on future projects, or share your reflections, we'd love to hear from you - just reply to this email.

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I thought I was just dealing with the consequences of my choices. It took me a while to realise I was also navigating the intricacies of policy in practice.

Growing up, I imagined policy as something abstract, something confined to a dusty grey lever-arch file on a bookshelf in a musty office. Not something that would directly impact my life. Maybe others’. But not mine. Which, in hindsight, is often how policy works.

I was 17 when I became pregnant. There’s a particular kind of silence that follows news like that. Not a peaceful silence. I had to leave home.

And this is where policy quietly enters my personal story – not loudly, not dramatically, just… administratively. Which, as it turns out, is how a lot of life-altering things are managed.

I needed to find a home, but at 17 I wasn’t old enough to enter into a tenancy agreement, and I couldn’t apply for housing benefit until I turned 18. Policy had drawn a line. Not around need, but around a number.

I’m sure there are very sensible reasons for this. Not least because numbers are very tidy; much tidier than people. But the fact that I was legally old enough to become a parent, yet not legally old enough to house us, felt like a plot hole.

When I turned 18, housing benefit came through. And for all its blunt edges, it worked. It kept a roof over my head during the final phase of my pregnancy and gave me nine months of something that felt like stability – long enough to begin learning how to be someone’s mum. (It also gave us both nine months of breathing in black mould that was never sorted before I left. Mould was dealt with by a different department...)

There’s a stereotype about teenage mums. You know it. I know it. It’s loud, it’s lazy, it’s irresponsible, and it’s deeply uninterested in nuance. Nuance is not a strong performer in the public imagination. It doesn’t test well in focus groups. So I imagine most people won’t have read this far assuming I had a full-time job when I fell pregnant. But I did.

I went on maternity leave just before my 18th birthday and quickly my income dropped from a whopping £750 a month to about £90 a week of Statutory Maternity Pay. Statutory pay sounds reassuring. Like it comes with a cup of camomile tea and someone saying, “it’s all going to be okay”. But £90 a week didn’t quite stretch. It did, however, introduce me to a less-than-ideal budgeting strategy: bill-paying roulette.

(For anyone wondering – council tax is not the one to skip. That one escalates quickly. With letters. And a stern tone. And eventually, bailiffs - which is a particular spice of scary as a young single woman with a newborn.)

This is what I’ve learned about policy: it can be a safety net and a tightrope at the exact same time. And sometimes you don’t realise which one it is until you fall off.

At 19, I applied for a job at the local authority. Let’s be clear – I was not the strongest candidate. My experience included six months in admin, during which I was once compared to Howard from Take That. Talented; full of potential; just not in the currently required category. (No shade on Howie, I was personally quite the fan.)

By any reasonable interpretation of recruitment policy, I shouldn’t have got the job. But I was interviewed by Andrea. She asked why I wanted the job. I told her the truth: I had a baby, and I wanted more for her. More for us.

Now, that answer probably didn’t score highly on the official scoring sheet. But Andrea did something policy doesn’t quite know how to contain: she used discretion. Discretion is a disruptive concept in systems that favour consistency and rules, valuing what can be measured and plotted neatly on graphs. Humanity colours way outside of those particular lines.

Andrea chose to look beyond the stereotype and saw me not just as a teenage mum trying her luck, but as a young person she could give an opportunity to. Her decision changed the trajectory of my life, which is quite a lot of responsibility for an early interview slot on a Monday morning.

Every time I’ve had the chance to do that since – to pay it forward – I have. Because I know what it makes possible. With my first proper pay cheque, I set up a standing order to my daughter’s Child Trust Fund – a government-launched, tax-free savings account – for £10 a month. Always the relentless optimist. The government contributed £1,000, and by the time she turned 18, that mix of policy and persistence bought her first car.

Policy can be pedantic, but it can also be possibility. But then there are moments where policy feels more like a game of chess, where one small move forward can cost you the game.

I remember the first food parcel I handed out. (Not technically my job. I was explicitly told as much. But everyone was at lunch, I knew where the key was, and I decided to explore my own relationship with discretion.)

A young mum – let’s call her Alice – came in with her baby. Her partner had received a small bonus at work. A recognition of his hard work. A good thing. Unless, of course, you’re thinking several moves ahead.

The small (taxable) bonus nudged their income just over the threshold for child tax credits – by a few pounds. Which meant they were issued a repayment notice. Not for the few pounds. For an entire year of payments. The “overpayment” was more than the (taxable) bonus. Which sounds less like maths and more like a twist in Traitors.

So in order to repay money they didn’t have, this young, working family had to ask for a food parcel. At the time, food banks required proof. Forms. Limits. Three parcels total. Because crises, like most things, are managed by systems. And systems like efficiency. “Work hard, but stay in your lane”, said policy inadvertently.

By this point, I was earning £850 a month. The childcare bill I needed to pay in order to go to work was also £850. Fortunately, those costs were covered by the tax credits I qualified for, reserved for the lowest income households. So, one part of the government paid me a salary it already knew wasn’t enough, while another stepped in to fix it, with rules. Which is either excellent co-ordination, or multiple opportunities for things to go very wrong. And those tend to tell their own story.

By 21, I knew I wanted to be a youth worker. I’d felt the deep value of youth and community work – from both sides. So I applied to university. And then I learned that students aren’t eligible for tax credits. So I traded income support that I didn’t need to repay for a huge debt that I am still paying back today. I wouldn’t change a thing, but it did feel like progress had a high interest rate.

And then 2010 happened. I was in the university library with my classmates from the youth and community degree course when one of them took a phone call (clearly breaking library policy). They said their boss had just been made redundant and the youth service had been cut. We laughed. Because sometimes the only appropriate response to something completely absurd is to assume it’s a joke. It wasn’t.

I didn’t graduate into the career I’d been building towards. That path had been removed by a policy decision made far away from that library. Which is impressive, really - the ability of policy to change someone’s life, for better or for worse, in an instant, and from a distance. But I did carve out a career at the intersection of education and youth and community. A career that ended up becoming a vocation. Just not in the linear way I’d once imagined. And my work is better because of that.

By the time I graduated, I started working full-time. My income was now higher than in my previous job, but still not quite enough to cover essentials. I wasn’t eligible for tax credits because I had been a student that financial year. So we became homeless. Not homeless enough for help. But homeless, nonetheless. Which is a very specific category.

Most of our belongings went into storage. Some of the more important things - such as my signed Take That poster - were housed in my office. The essentials came with us to a log cabin (a large shed at the bottom of a garden). Temporary, I thought. Which is what you always think about things that last longer than they should.

I called the housing department at the local authority and asked to be put on the housing waiting list. They told me there was no point. We weren’t a priority or considered homeless according to their policy, because we had a roof over our heads. “Even though it’s made of wood, has no hot water or kitchen - and we’re sharing a bed?”, I asked. Yes, they said. And because I assumed the rules were being applied as they were written, we lived outside them for a while.

To be continued…

Policies aren’t intentionally designed to cause harm. But they aren’t necessarily designed together either, or by those most likely to be affected by them. So they overlap. They collide. They compound. And become the status quo.

And many of us - knowingly or not - play a part in sustaining that. Which can be uncomfortable. And useful to notice. The more I understand this, the harder it is to ignore.

I’m grateful for the support I received – I just no longer mistake it for a solution.

I’m increasingly meeting people who are committed to shifting systems. And they are succeeding. These people aren’t just talking about fairness - they’re attempting it. Which is messier, and slower. But necessary. Because that’s how real change happens. And that gives me hope - even if nuance still isn’t a particularly strong performer.

This piece was written by Charlie Chan, Director of United Communities. It was sparked by a conversation with Will Snell, CEO of the Fairness Foundation, at the Anthropy National Gathering 2026. Charlie was able to be at Anthropy through the generosity of UK Acumen Academy and United Learning.

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In an interview with the Fairness Foundation’s Jack Jeffrey, Brett Christophers (Professor of Human Geography at Uppsala University) argues that Britain’s post‑1970s “neoliberal” turn was less about rolling back the state and more about actively reshaping ownership, monetary policy and regulation to create protected zones of rent extraction, particularly in housing, land and infrastructure. He explains how stagnation, rising asset prices and post‑crisis monetary policy have entrenched rentierism and asset manager power, leaving governments dependent on private capital for investment and with few credible alternatives short of compulsory or quasi‑nationalised investment.

Jack Jeffrey (JJ): You suggest that neoliberalism in Britain — and I promise that’s the last time I’m going to use that word — wasn’t really a project of deregulation, but more an active political construction of secure, protected zones of rent extraction through monetary and fiscal policy, and asset ownership regimes. The conventional post-1970s story is of a state retreating from the economy, rather than, as you say in Rentier Capitalism, actively redesigning it in ways that advantage particular asset holders. I’m interested, just to kick things off, in why that is?

Brett Christophers (BC): I don’t like to oversimplify things, but I think a big part of the reason is that once David Harvey had written A Brief History of Neoliberalism (2005), which was one of the first books on the subject, the slew of books that followed had it that neoliberalism was very much centred around the rise of a market society. The story became about the ways in which key resources in societies come to be allocated and distributed, and the question of ownership of resources and assets disappeared somewhat.

One part of what I’ve been trying to do over the last decade or so, but particularly in Rentier Capitalism, is to say: hang on a second, there’s an important story about ownership here. It’s always seemed to me that if we want to call the period since the 1970s in the UK the neoliberal period, the transformations in patterns of ownership were much more significant than transformations in the ways in which resources were or weren’t distributed and allocated. The emphasis on marketisation is not so much wrong, but rather only part of a wider story. In the British case, more so perhaps than elsewhere, this is a story where the default model of ownership became private ownership by capital. This had been a part of Harvey’s book – the restoration of class power was essentially about ownership – but it wasn’t made explicit.

JJ: I think people are slowly staring to understand this. Your work, alongside others like Common Wealth, has done a very good job of shifting the focus onto questions of ownership. You can even see it on parts of the right too — a suspicion of foreign capital buying up large swathes of British industry, and so on. I think this is not just a left or right issue now.

BC: Yeah, absolutely. Getting away from the UK context, if you look at Donald Trump coming out and saying that we need to ban institutional investor ownership of single-family housing in the US, that’s another great example of what you might call a populist politics of ownership transcending traditional political boundaries. I remember when I first started to write about institutional investment in housing, I had political actors on the right reach out wanting to talk about my research – I said no. But it is unsurprising that this issue does cut across traditional political boundaries, in so far as it is completely trampling on the home ownership dream that is so integral to rightwing politics.

It’s slightly different in the UK. Big institutional investors as owners specifically of housing is less of a problem than ownership of other types of critical infrastructure — energy, transport, water and wastewater.

That idea of a property-owning democracy worked for a long time in a UK context, because the effect of deregulating and liberalising housing finance, and the Right to Buy scheme, had a kind of democratising effect, whereby you did open up the possibility for home ownership to a wider social spectrum. From the early 1980s until the mid-2000s you had growing rates of home ownership, from around 55 per cent, when Thatcher came to power, up to a peak of around 70 per cent. That reinforced Thatcher’s argument about a property-owning democracy.

What then happened was all of that entailed a massive increase in house prices. You reached a point by the mid to late 2000s where affordability constraints kicked in, particularly among young people. That was when you saw the home ownership rate peak and begin to come back down. But it wasn’t just about affordability restrictions kicking in. It was also about the growth of the buy-to-let market. Potential young homeowners were now competing not just with one another, but with buy-to-let investors.

We’re now at the point where, unless you’re in banking or consulting or a few other very highly paid professions, if you’re in the London and the South East and you’re under 40, you have no hope of buying housing unless you have parents who can leverage their own home ownership. The housing market has become a vehicle for the reproduction and exacerbation of class inequality through generations. And that is only going to become a more significant social phenomenon over time.

JJ: I’m really interested in this. There is obviously a lot of momentum behind the agenda of taxing extreme wealth. There is something I find sympathetic in that narrative, but I’m much more convinced by arguments from people like Lisa Adkins in The Asset Economy — that one of the things Piketty that misses in Capital in the 21^st Century is that lots of people, not just billionaires, are implicated in this economy, in this political economy, that has organised more and more of itself around asset ownership. That’s the problem.

And especially in the UK, we have a culture in which people have been encouraged to speculate on the housing market. Which, as you say, has had catastrophic effects on those who aren’t already participating in this system. But unlike in the US, where blame can more easily be directed at large institutional investors, it seems a lot more difficult to identify a single obvious bad actor in the British context.

BC: The buy-to-let market in the UK is a fascinating case. I think there are now around three million people in the UK who own a second, or more, residential property. The vast majority of them are not super-rich people. If you look at the data, the median income before rental income of most buy-to-let investors is pretty average, or even below average.

As I see it, these people look around them at a chronically stagnant UK economy and think about how they can better their own circumstances. The Fairness Foundation has done some really interesting research on this issue. A few years ago, they asked people about five or six different hypothetical wealthy characters — a sports person, someone who inherited their money, an entrepreneur, a financial investor, and a landlord — and asked what people thought of them. Did they get their money fairly? Did they get it through hard work? Is this type of wealth generally available to people? And the landlord came out pretty well. That doesn’t surprise me, and I think it’s really telling. Eighty years ago, if you’d asked the same question, everyone would have been relentlessly negative about the landlord. But people now see buy-to-let investment as one of the few ways to get ahead.

I do not think moralistic takes on buy-to-let are very helpful, because buy-to-let is a symptom, not a cause. It tells us something about the kind of political economy Britain has become. To say that landlords are simply terrible people is to miss the point. The more important question is why rent extraction has become such a central feature of economic life. Many buy-to-let investors are simply trying to secure themselves in an economy where other avenues for security have disappeared. It is a more interesting, more socially significant, and more complex phenomenon than many critics, especially on the left, are willing to acknowledge.

JJ: The relationship between rentierism, growth, and productivity is one of the most important questions in contemporary political economy. How robust is that relationship, and what is its causal direction? Does rentierism actively produce stagnation by channelling capital into extraction rather than innovation, or does prolonged stagnation encourage rent seeking as economic actors adapt to a low growth environment? I suspect it works both ways.

These are particularly important questions in the British context, where political debate is now dominated by the language of growth. But a lot of that discourse treats growth as an abstract imperative rather than asking more fundamental questions about Britain’s economic model, and why it might be organised in ways that systematically frustrate genuine wealth creation.

BC: I’ll begin by saying that I’m by no means an expert on the statistical or quantitative nature of that relationship. But what I will say is that it obviously, as you say, works both ways.

There’s clearly a relatively strong argument, which has been around for a long time now, that a slowing of economic growth itself encourages rentierism. A big part of the literature on what changed in the economies of the Global North from the 1980s onwards was that you had declining rates of profit and economic stagnation, and that was why financialisation occurred. You get these cycles where, once mature economies go into stagnation in the productive economy, investment shifts into the unproductive financial or rentier economy. I have a lot of time for those arguments.

But the way I looked at it in Rentier Capitalism was the other way around. Yes, stagnation in productive investment can shift investment into unproductive investment, but it also works the other way: once your economy becomes more focused on ownership and control of monopolistic assets of various kinds, that in itself tends to create economic stagnation. You have actors who become principally interested in protecting those existing assets, policing them, trying to ward off competition to the income-generating qualities of those assets. That creates a very stagnant environment in which you’re not getting much by way of innovation and productive growth. It’s classically symptomatic of that kind of environment that, in the UK’s case, the data suggests that the biggest source of economic growth in recent decades has been precisely land, and the buy-to-let sector. That could only happen in a scenario in which the rest of the economy is doing dreadfully. You would be unlikely to see that almost anywhere else in the world.

JJ: One of the things that struck me across both your work on rentierism and your more recent work on the asset manager economy is the central role of monetary policy, particularly quantitative easing and the prolonged period of low interest rates after the financial crisis. Central banks appear repeatedly to have acted in ways that sustain asset prices and, in doing so, to have reinforced both rentier incomes and the business models of asset managers. How far do you see central banks as having become key institutions through which rentierism and asset manager power are reproduced?

BC: That was obviously a really important period. When I was working on Rentier Capitalism and looking at rentier dynamics in different parts of the economy — finance, intellectual property, natural resources, infrastructure, land and housing — I kept seeing the same types of actors across all these different sectors, namely asset managers, specifically private equity-type asset managers like Blackstone, Macquarie Group, Brookfield and others.

I wanted to understand more about these financial institutions – which is why I wrote Our Lives in Their Portfolios – and to figure out why it was that in the UK, but not only in the UK, they had seemingly become much more important as owners of key types of physical infrastructure in society, including housing, but not only housing — energy infrastructure, water and wastewater infrastructure, transport infrastructure, telecommunications infrastructure and so on.

What I found when I was doing the research for that book was that this had become a particularly significant phenomenon, as you say, after the financial crisis in the 2010s. That’s not to say that these institutions weren’t investing in housing and municipal waterworks and gas transmission systems before then, but the growth of that investment really surged after the financial crisis. And, as you say, a big part of that was the new macroeconomic environment.

A useful way of thinking about this is to think about the nature of financial investment and what institutional investors are looking for. They’re looking for two different things, in varying combinations. First of all, they’re looking for capital gain. They want to invest in something and then, when they sell it later, they want to sell it for more than they bought it for. But they’re also looking for income. Ideally, when you hold an investment, you want it to generate an annual yield. Different types of investors are interested in different combinations of capital gain and income, but historically investors looking for income have relied principally on fixed-income financial securities, i.e. bonds. They would buy government treasuries or, in the UK case, gilts; they would buy corporate bonds; and those bonds would pay an annual coupon — anywhere between 3-7 per cent roughly — and provide an annual yield, alongside some dividends from stocks. But it was primarily bonds that supplied that annual income.

After the financial crisis you had a long period where interest rates globally fell to zero or close to zero, in some cases below zero. Suddenly, big institutional investors and asset managers were faced with a situation where bonds weren’t providing meaningful annual income anymore. In that environment, investors asked themselves, where could they find that annual income? Real estate and infrastructure were a big part of the answer. Instead of investing in bonds paying 1 per cent annual income, you could invest in housing or commercial real estate, which would provide annual income because of the rents being paid. Or you could invest in infrastructure because of the fees being paid by users of that infrastructure, whether toll roads or mobile-telephone transmission towers or whatever else it might be.

That was a huge part of the reason for the massive growth of real-estate and infrastructure investment by institutional investors, and in particular asset managers, in that post-2008 period. There was this turn to physical assets — so-called real assets — as a reliable and substantive source of income. You can’t understand what happened there without paying significant attention to monetary policy.

As I hinted at earlier, in the UK, this was principally an infrastructure story. For example, a lot of money in the UK went into the water companies. When privatisation happened in the water sector — and also in the electricity sector, to use another example — it principally happened through what had been state-owned public enterprises being floated on the stock market. What then happened was that those public companies were taken private by asset managers. They were delisted and became private. Thames Water would be the classic example. Macquarie Group became the majority owner of Thames Water in 2006 and owned it up until 2017. Obviously today, Thames Water is a basket case, but in many ways it’s a quintessential example.

Elsewhere in the world, as I mentioned, it was more of a housing story. In the US, Germany and Spain there are very significant examples where asset managers became, and remain today, huge owners of residential property. I think the reason that hasn’t happened in the UK yet is that, along with countries like Australia, residential housing ownership is incredibly fragmented in the UK. There aren’t many big owners of rental housing, by which I mean entities that own significant portfolios of rental housing. Most of the UK’s private rental sector is in the hands of small buy-to-let landlords.

The UK’s biggest private-sector residential landlord is a company called Grainger, which I’m sure almost no one will ever have heard of. It owns only about 11,000 rental homes, which compared to the portfolios of big investors in the US, Spain and Germany is chicken feed. The fact that the big asset managers are not significant owners of housing in the UK is not because they don’t want to own housing. It’s because the opportunities to buy large portfolios — which is their modus operandi — simply aren’t there.

If you’re a big asset manager, you’re not in the business of spending £100,000 here and £200,000 there. You’re in the business of spending hundreds of millions. It’s not transactionally efficient to do piecemeal acquisitions.

That’s why, in the UK, when you hear about these guys, you hear more about the build-to-rent market. But what they’ve also realised is that building housing isn’t particularly profitable. It’s much more profitable to own portfolios of already-existing housing and rent them out than it is to build them.

JJ: Just one last question on the monetary landscape. Now interest rates have ticked up a little bit, do you think that will change anything going forward? Are the conditions for that asset manager society disappearing?

BC: On the infrastructure side — and I’m focusing here not just on the UK but internationally — it definitely has made a difference. When I wrote that book, which was written in 2022, interest rates were just rising again because of the uptick in inflation. Central banks tightened monetary policy, interest rates went up, and while they’ve come back down a bit, they’re still higher than they were during the 2010s. That has definitely had an impact on infrastructure investment by financial investors. We’ve definitely seen less of that in recent years, and those big investors have only been willing to continue investing in infrastructure where it has been made particularly favourable for them to do so. This is where the language of de-risking comes in. What they’ve said is: we will continue to invest in infrastructure, and potentially develop new infrastructure, but only if governments make it really favourable to us by taking the risk off our hands, and guaranteeing certain levels of revenue.

On the housing side, the market has remained much more robust internationally. Once asset managers got into housing in a big way in the 2010s, they realised what a good business it was. They realised just how profitable it was to be owners of rental housing, particularly in parts of the world that are supply-constrained. In cities where, because of various zoning restrictions, there are significant constraints on new construction, those constraints obviously help put upward pressure on rents. They’ve realised that it can continue to be profitable to own portfolios of rental housing even though interest rates have gone up.

The other thing worth mentioning is the way they’ve tried to boost profitability by seeking out cheaper sources of debt financing in that higher interest rate environment. The main such source has been private credit funds. Historically, if you were Blackstone and you wanted to invest in infrastructure or in housing or commercial real estate, around 40 per cent of the money for that investment would be equity, but you would borrow the rest — around 60 per cent — in order to leverage the investment and enhance the returns. You would go to banks for that debt financing. But what’s been happening in recent years is that increasingly you would go to non-bank debt financiers, namely big private credit funds. They provide a much cheaper source of debt financing, which is a way for asset managers to boost their equity returns.

In short, they’ve found ways of maintaining the profitability of this real-asset investment even in a higher interest rate environment.

JJ: Sticking with asset management, in a paper that you co-authored with Benjamin Braun, you make a distinction between three related issues. You have asset managers as profit-making firms in their own right; secondly, as shapers of other capitalist enterprises; and thirdly, as shapers of capitalism and society at large. Why are those distinctions analytically important, and how are they held together?

BC: I think they’re important simply because otherwise the discussion can, and does, get very confused. There’s lots of terminological and conceptual slippage when people talk about asset managers. We tried to draw that distinction as a way of imparting a bit of order into how we collectively as commentators and scholars talk about asset managers and their role in contemporary capitalist society. It’s clearly the case that asset managers have become enormously more significant within capitalism in recent decades. And it’s worth saying a bit about why that is and putting some numbers on it.

At a very basic level, an asset manager — despite the almost infinite variety in operating model, size and investment focus — is a financial investment institution distinguished by the fact that most, and sometimes all, of the money it invests is not its own. Asset managers invest other people’s money, whether that’s retail investors like you and me, or institutional investors, particularly pension funds, insurance companies and so on. Most of the money that BlackRock or Blackstone invest is not their own money. The vast bulk of it is money that they are investing on others’ behalf for a fee — or, in reality, for various different types of fees: management fees, performance fees and so on.

If you go back to the 1970s, the total amount of capital that asset managers globally had at their disposal — the amount of money they managed on behalf of others — was in the order of about $1 trillion. Today it’s over $100 trillion. Asset managers have gone from very insignificant institutions to very significant institutions, purely measured by the amount of capital at their disposal, the amount of money they are managing.

Why has that happened? Two things have changed between the 1970s and today. First, there is simply more surplus capital swilling around the world now than there was then. The big sources of that growth in surplus capital are pension funds, sovereign wealth, and insurance companies. There are more retirement savings now than there were then. Pension capital has become much more significant. There is more sovereign wealth around — a lot of this is to do with oil wealth, but not only oil wealth. And insurance has become a bigger business, and the premiums we pay represent capital that insurance companies manage and invest in order to make a profit.

The second thing, which is equally significant, is that those ultimate holders of surplus capital invest that money not themselves but through asset managers. Pension funds, sovereign wealth funds and institutional investors now routinely hand much of their money to firms like BlackRock and Blackstone, on the grounds that these firms have the expertise, scale and infrastructure to allocate it more effectively. The result is that investment decisions are increasingly mediated by a relatively small number of asset management firms, which earn fees for deciding where capital should go.

You put those two trends together — more surplus capital, and more of it being outsourced to asset managers — and that’s how you get from $1 trillion to over $100 trillion.

Now, in what ways have they become more important? What matters first is that asset managers have become major capitalist institutions in their own right. So one line of analysis is simply to treat them as a sector of accumulation: how do they make money, how much money do they make, and what is distinctive about their business models? In other words, asset management is not just a conduit through which capital passes. It is itself a profit-making sector that needs to be understood on its own terms.

Second, asset managers matter because they invest in, and thereby shape, the rest of capitalism. They do not simply sit outside the productive economy; they are deeply embedded in it through ownership and control. Sometimes that means outright ownership, as in private equity. Sometimes it means large minority stakes, as with BlackRock, State Street and Vanguard. The classic numbers are that the average S&P company is around 9 per cent owned by BlackRock and around 30 per cent owned collectively by BlackRock, State Street, Vanguard, Fidelity and so on. Even where they do not own firms outright, they can still exert significant influence over how companies are run, what strategies they pursue, and what counts as acceptable performance.

The point about BlackRock and the other large index managers is not that they control every company in some simple, unified sense. It is rather that, through the growth of index funds and diversified holdings, they have become “universal owners”: institutions with a stake in a vast swathe of the corporate economy. That changes the ownership landscape even where day to day control remains indirect.

The third question is broader again. Once asset managers have become central both as firms in their own right and as owners of other firms, we need to ask what this does to capitalism as a whole. How are industries reorganised when asset-manager logics become more pervasive? How are states, regulators and macroeconomic policy shaped by their preferences? How does the wider political economy change when these institutions become central nodes in the allocation of capital? This is the broadest analytical register in the paper you mentioned, not just asset managers as firms, or as owners of firms, but as institutions that shape the wider organisation of capitalism and society.

These three levels are analytically distinct, but they hang together. Asset managers are profit-making firms; they make those profits by investing in and influencing other firms; and as those relationships become more widespread, their priorities and business models begin to shape the wider contours of capitalism itself. That is why it makes sense to separate the questions, but also to see them as parts of a single process.

One obvious way that this broader power appears is in politics. When people once thought about the political clout of finance, they mainly thought about banks. Now, increasingly, they think about asset managers. The symbolic shift from Goldman Sachs to Larry Fink or Steve Schwarzman tells you something real about how power within finance has moved. The financial sector has changed, and with it the key institutions to which political leaders increasingly orient themselves. That does not mean that banks no longer matter. It means that asset managers have become central enough that they now have to be understood as major political-economic actors in their own right.

JJ: Last question. A lot of these institutions have incredible amounts of capital to deploy. Combine that with a scenario where states don’t have the capacity and resources that they once did to build infrastructure. What do we do in that scenario? Politicians are, for understandable reasons, desperate for these institutions to invest in Britian, but that comes at a price.

BC: It’s one of the most salient questions of our age. We live, on the one hand, in a moment where asset managers control the bulk of surplus capital available for investment. That’s the first thing. The second thing, as you say, is that we also live in an age of extreme fiscal conservatism, where governments believe — or have allowed themselves to be led to believe — that they can do much less in terms of public financing and public investment than was historically the case.

I don’t want to get into too much detail about the extent to which that belief is true or false. I’m definitely not one of those people who says it’s all a myth, and that governments can still borrow cheaply and freely and won’t be punished by bond markets. There is a degree of financial reality we shouldn’t dismiss out of hand, not least in the Global South, where fiscal constraints are even more severe than they are in the Global North. In any case, whether it’s based on economic fundamentals or not, governments now have to a significant extent taken public financing and investment off the table.

The third thing, as you say, is that we are in a situation where, not least in a country like the UK, a huge amount of investment is required in infrastructure and particularly climate infrastructure for both mitigation and adaptation purposes.

Put those three things together and it really isn’t surprising that the likes of Reeves are cozying up to asset managers. Once you take public investment off the table, what else are you going to do? You turn to private capital if you want to get anything done.

Certain colleagues of mine on the left will insists that if private capital is the only answer, let’s discipline private capital. Let’s not de-risk that capital. Let’s say its investment is welcome, but conditional, and impose robust conditions on the terms on which it invests and the amount of profit it can make. That’s a nice story in theory, but the reality is that as soon as you say that, they threaten to take their money elsewhere. That’s the political-economic reality. I think this idea of conditionality is very nice, but it conflicts pretty gruesomely with the political reality we are facing.

You see this in sectors such as water. Historically, whenever Ofwat has signalled that it intends to take a tougher line — recognising that water companies have been abusing the situation by continuing to release effluent into rivers, and that the response must involve more serious fines and more robust regulation — large institutional investors and asset managers have been quick to warn that they may withdraw from the UK. And of course, as soon as they say that, the government panics and capitulates And I do kind of get it. We are caught between a rock and a hard place. I’m not sure what else governments can do if public-sector financing and investment is taken off the table. You are just left with private capital, and it is very difficult to discipline private capital when private capital can go on capital strike.

The only alternative, as I see it, is basically — if not nationalising industry — then quasi-nationalising it through compulsory investment of various kinds. People often like to use wartime analogies when they talk about climate. In wartime, governments force capitalists to invest in certain ways. Are governments in the Global North even close to forcing capitalists to invest in certain ways today? No, they are not remotely close.

That’s the only alternative, as I see it. But right now we are in this very unfortunate situation where public investment isn’t happening, and private investment only happens if governments de-risk it sufficiently to guarantee a certain level of profitability.

That is exactly where clean energy investment is in the UK. Big offshore wind investment is only happening because the UK government is guaranteeing a certain level of return sufficient to call forth that investment. And, to be clear, if the choice is between, on the one hand, de-risking private investment in clean energy and allowing major investors to earn guaranteed returns of 9 or 10 per cent, and, on the other, refusing to do so on principle and thereby failing to deliver the investment at all, I would choose the former every time. The regrettable part is that these have come to seem like the only options available. That’s the best way I can put it.

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In February 2026 a group of academics, policymakers and campaigners met to discuss Stuart White’s new book, The Wealth of Freedom.

Co-hosted by the UCL Policy Lab and the Fairness Foundation, the roundtable set out the republican idea of freedom as non-domination and asked what follows when that ideal is taken seriously in an economy marked by large and persistent concentrations of wealth.

The public have competing views on the subject of wealth inequality, and so the discussion also asked how a republican account could make wealth inequality more politically salient in the UK.

A better frame for thinking about wealth disparities, and for raising awareness of its negative spill-over effects, could be less of a focus on quantitative differences, and more on the nature of those differences, especially an emphasis on dependency, domination and freedom.

Below are some reflections from Stuart White. You can read an extended write-up of the roundtable on our website or download a PDF.

Wealth is power. Those who lack wealth are more dependent on others for many of the resources they need, and this can make them vulnerable to domination by those on whom they are then dependent – employers, landlords, creditors, spouses, or state bureaucrats. Those who hold at least some wealth have more capacity to avoid these relationships of domination. On the other hand, those with wealth can use this to buy political influence. They might make donations to parties which get them favours, seats in the House of Lords, or even use extreme wealth to buy social media platforms which they can redirect to suit their own political agenda. In this way, the rich can start to dominate the rest of us through their outsized influence on policy. A distribution of wealth, then, is not just an inequality as measured by, say, a Gini coefficient. It is a particular configuration of social and political power with direct and substantial implications for our freedom.

This is why a democracy requires a robust economic floor and a robust economic ceiling. The job of the floor is, in part, to protect people from being too dependent on the will of others, from being vulnerable to domination by those on whom they are otherwise dependent. The job of the ceiling is, in part, to limit the power of the very rich so that they do not dominate the rest of us in our political life. In my book, The Wealth of Freedom, I explore some of the ways we might try to institute a robust economic floor and ceiling. I discuss, for example, the potential role of a universal basic income in helping to set the floor, and the role of inheritance and wealth taxes in helping to set the ceiling.

As these policy ideas suggest, however, setting a robust floor and ceiling will require concerted action by the state. One problem highlighted in the roundtable discussion on the book is that people today often lack trust and confidence in politics to do the kind of heavy lifting which this implies. Given the oligarchic skew of our supposedly democratic politics, this is not unreasonable. So we appear to be in a bind. We need action to limit wealth inequality in order to protect - or create - democracy. But we need a functioning democracy to do what is necessary to limit wealth inequality.

There is no easy solution to this. But a constructive response must be to combine a reform programme focused on building an economic floor and ceiling with a political reform programme. This political reform should aim at once to push back against oligarchic power and to rebuild popular trust and connection with the democratic state.

In part this has to involve new and much more effective measures to cut down the power of money in UK politics. This includes a review and overhaul of electoral funding and party donations; of the rules that allow MPs and former MPs to take employment such as paid advisory roles; and of the rules around lobbying. I suspect that reforms in these areas, of a radical kind, would be popular with the general public. They would speak to the concern about corruption which the discussion at the roundtable raised.

To get meaningful reforms of this kind, however, we need to look to other ways of empowering citizens to have more influence on the political agenda and to increase the responsiveness of politicians to popular concerns. This may connect to some long-standing issues with the UK political system such as electoral reform. But we should also think creatively about how new forms of representation might contribute. Imagine, for example, that we have the right to initiate Citizens’ Assemblies (CAs) in chosen topics, such as the rules around lobbying and money in politics. What would a properly resourced CA recommend in this area? How might a CA help to set a fresh agenda on this topic and help build public interest in reform that overcomes inevitable resistance? What could a CA similarly contribute to setting a policy agenda around public broadcasting or the control of social media platforms?

Political influence is also crucially affected by the degree of popular association in society. Trade unions, for example, matter not only because of the benefits they can deliver for their members. They matter also because of the way they shape wider power relations. A democratic society with strong and encompassing trade unions will have a force capable of pushing back against the power of the very rich that a society with a weak trade union movement does not. It will, in this respect, be a much more democratic society. Here economic and political reform agendas come together. Reforms to labour law to promote wider trade unionism help simultaneously to build a more robust economic floor and a counter-weight to the excessive power of business corporations and the very rich.

The project of building a robust economic floor and ceiling should not be approached, then, as a technocratic policy-making exercise. It must be approached as part of a wider, deliberately anti-oligarchical project that combines economic and political reform to shift the balance of power in our society – and thereby to help rebuild public confidence in the capacity of the democratic state to address our problems.

Stuart White, Nicholas Drake Tutorial Fellow in Politics and Associate Professor of Politics at the University of Oxford

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This month, we deepened our focus on the structural inequalities shaping people’s lives. Across our work, we explored how Britain’s economic model continues to entrench unfairness, and considered how policymakers can help to set out a clearer path towards a fairer future.

On 19 March we launched Escaping the State We’re In, a major new report by Will Hutton, Chair of our Advisory Board. It revisits, and radically updates, the arguments that he first made thirty years ago in The State We’re In, setting out how Britain can rebuild an economy capable of delivering prosperity, fairness and long‑term investment. In the process, Will argues for a new model of capitalism that can deliver economic and social good outcomes, based on the unifying value of fairness.

In the report, Will argues that Britain’s economic malaise is the result of decades of underinvestment, policy failure and a political system that has failed to reform. The consequences are now visible in stagnant living standards, declining public health, and a business environment in which too many promising firms are sold abroad or never scale at all.

The report lands at a moment when debates about Britain’s economic model are intensifying, and then the country needs a fundamental rethink of its political economy.

Across think tanks, business groups and even parts of government, there is a growing recognition that the UK’s low‑investment, low‑productivity equilibrium is unsustainable, leaving the country more exposed, more unequal and less capable. It also connects directly to our wider programme of work on wealth, extraction and democratic reform.

Our model of capitalism is currently shifting economic activity away from public markets. Instead of backing entrepreneurial businesses that create value, the system has become skewed towards industries that extract wealth. An economy that relies on asset inflation rather than productive investment inevitably concentrates power, undermines trust and produces zero-sum outcomes.

The report argues that Britain can still become a fairer, stronger and more confident country, but only if it ‘grips the reins’ of capitalism more firmly by mobilising investment, disciplining extraction, rebuilding state capacity and aligning growth with the common good.

Earlier in the month we published A Tale of Two City‑Dwellers, a joint report with the Black Equity Organisation that examines the racial wealth gap. It combines facts and figures on this pernicious gap with two detailed case studies to bring the evidence to life.

In the report, “Josh”, a White British charity worker, and “Anthony”, a Black Caribbean railway shunter are both 30, live in London, and earn similar salaries, but their life chances diverge sharply because of unequal access to family wealth. The case studies illustrate how wealth, or the lack of it, compounds across education, work, housing and mental wellbeing. They also show how racial inequality and wealth inequality intersect, creating a feedback loop that reinforces disadvantage over time.

The report reveals how wealth inequality now shapes life chances more decisively than income, exacerbating a range of racial inequalities which are the product of both historical discrimination and contemporary policy failures.

The report draws on other research, such as The Runnymede Trust’s Colour of Money report from 2020, which analysed ONS data to show that for every £1 owned by White British households, Black African and Bangladeshi households hold only 10p. It also includes contributions on ethnicity pay gap reporting, timely given the recent Cabinet Office consultation on the issue, with the government’s positive response published last week.

We’re grateful to the cross-party MPs who joined us in Westminster to launch the report at a breakfast roundtable this month (and particularly to our host Adam Jogee MP for sponsoring the event). As Britain prepares for major debates on tax, housing and economic reform, this work reminds us that racial inequality remains central to the conversation.

We also published a long‑form interview with Andy Burnham, Mayor of Greater Manchester. In a wide‑ranging conversation with our Advocacy Manager, Jason Bunting, the Mayor discussed how devolution can help unlock fair growth, and how political reform is needed to drive a fairer economy across the country.

He drew a sharp distinction between growth that enriches communities and growth that extracts value without building long‑term prosperity, mirroring our own work on wealth extraction and the need for an economy that rewards innovation, not rent‑seeking. The Mayor also made the case for devolving land, property and business taxation as a way to give places the tools they need to shape their own futures. This aligns closely with our December report A Fair Share, which argued for a long‑term vision for fiscal powers at the local level.

Read the full interview

Perhaps most striking was the Mayor’s argument that meaningful devolution would be best unlocked through Westminster reform, including an elected second chamber representing the nations and regions.

Of course, regional inequality remains one of Britain’s most persistent structural problems- and one of the most obvious and pressing examples of unfairness in the economy. The Mayor’s comments helped to connect the dots between fairness, devolution and national renewal, a theme we’ll continue to explore.

Fortunately, the argument for greater fiscal devolution appears to be gaining momentum, as evidenced through the Chancellor’s announcement in her Mais lecture that she will develop a roadmap for future fiscal devolution, including plans to give regional leaders control of a share of some national taxes.

This month we also published a new blog by our Senior Researcher Jack Jeffrey. It explores why Britain’s property tax system is widely acknowledged as unfair, outdated and distortionary, yet has proven so resistant to reform.

As Jack lays out, property taxation is, of course, a political issue which is rooted in the central role that home ownership plays in Britain’s social imagination. For many people, property is not just an asset but a symbol of security, independence and moral worth. Any reform is therefore interpreted not as a system fix but as a personal threat. Yet Britain’s reliance on property wealth has distorted the economy, widened generational divides, and entrenched inequality.

As Lisa Adkins and others have argued, we now live in an “asset economy” in which access to appreciating assets matters more than wages or productivity. This helps explain why even modest reforms, such as revaluing council tax bands, face fierce resistance, despite widespread recognition that the current system is unfair and notwithstanding recent developments such as the introduction of the High Value Council Tax Surcharge.

Those are issues that have been advanced at length by a range of campaigners and organisations, notably the Fairer Share campaign which has built significant momentum for reform and is currently running a petition calling on the Government to replace Council Tax, Stamp Duty and the Bedroom Tax with a Proportional Property Tax.

The politics of property taxation sits at the intersection of several themes we’ve been exploring, such as the rise of wealth over income as the driver of inequality, the difficulty of reforming systems that benefit powerful groups and the need for a new political economy that reduces reliance on asset inflation.

If you’d like to discuss any of this month’s work, collaborate on future projects, or share your reflections, we’d love to hear from you.

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Last Thursday, the Fairness Foundation and the Policy Institute at King’s College London hosted the launch of Escaping the State We’re In at a reception in the Houses of Parliament.

The report, written by celebrated political economist, commentator and author Will Hutton, comes thirty years after the publication of Will’s seminal work The State We're In (the best-selling economics book since the second world war). It sets out the changes needed to Britain's politics and economy to build a more successful, fair and confident country, arguing that bolder action is needed to support great value-generating companies and repair Britain’s frayed social contract. Will makes the case for an approach to economic growth that rewards genuine entrepreneurship and innovation while tackling disabling levels of inequality and boosting the capacity of the state to achieve these twin fundamental aims.

Read the report

The launch event on Thursday brought together five speakers to interrogate that proposition, explore the state of Britain’s political economy, and consider how the country might rediscover a sense of direction and possibility.

Will Hutton opened the evening by acknowledging the shadow cast by current geopolitical instability. “I’m keenly aware that the Iran war may last rather longer than President Trump expects,” he warned, noting that the conflict is likely to become “an energy war as much as a military war.” That environment, he argued, sharpens the stakes of the economic debate. Questions about Britain’s “productive capacities, national resilience, [and] defence capabilities” are immediate and unavoidable.

These problems beset an already fragile economy that is marked by levels of wealth inequality not seen since the 19^th century. There has also been an enormous shift in the pace and breadth of technological innovation, the fourth industrial revolution that spans photonics, robotics, artificial intelligence, digitisation and life sciences. But this revolution has been complicated by the increasing “privatisation of capitalism”: the growing share of economic activity taking place in private markets, private equity, private credit, private infrastructure, family offices. These structures can drive innovation, but they also risk “monopoly… unaccountability… dense concentrations of wealth… [and] a new precariat.”

However, far from languishing in despair, Will used the occasion to make a powerful argument about a fairer economy and country, built on the inarguable strengths of Britian today. Britain is, in his words, “astonishingly entrepreneurial,” ranking third globally for innovation and first in Europe in a critical mass of frontier-tech companies. We possess at least 800 venture-backed high-tech scale-ups with turnover in excess of $25m. These firms represent the seeds of a future economy, even if Britain has so far failed to convert this entrepreneurial energy into durable national prosperity. The UK should be “five, six, seven times more ambitious” if it is serious about building the tech economy. Will quoted the economist Philippe Aghion: “capitalism is a spirited horse; it takes off readily, escaping control, but if we hold its reins firmly, it goes where we wish.”

That these businesses need government ambition to match their potential was a point reinforced at the event by Ravi Gurumurthy, CEO of Nesta, who offered several powerful examples of how the state can play an active role in shaping the rails on which capitalism runs in order to meet the “need to push forward the frontier of innovation with these 800 firms and do whatever it takes to unblock the barriers to growth”. Ravi pointed to the example of India’s digital ID programme, which now covers 1.4 billion people and underpins a payments system through which more transactions flow than the whole of the global Visa network. Ravi also encouraged more confidence about Britain’s own achievements, pointing to the energy transition as an example. He noted that in 2010, only 20% of the electricity system was decarbonised; today the figure is around 65%, a product of strategic policy, public investment and clear direction. His conclusion was clear: “The state can set a direction… it can solve these coordination problems, but it has to be quite active in driving competition as well.”

Similarly, Michelle Ostermann, Chair of the International Centre for Pension Management, encouraged the UK to look at international best practice when thinking about how to use the lever of pension reform to boost growth - a topic explored at length in Will’s report. Britain’s pension ecosystem, she argued, is not yet designed to generate the “patient,” capable capital needed to support productive investment at scale, but other countries, such as Canada, Australia and the Netherlands, show what is possible. Michelle cited OECD evidence that the difference between successful and failing pension systems is design, that “it’s not just about piling in more money; we need institutions properly equipped to create wealth at scale.”

Julian Richer, founder of Richer Sounds and of the Fairness Foundation, echoed Will’s central argument that if the reins of capitalism are gripped tightly, it can deliver growth that can benefit society as well as the economy. Julian encouraged a greater understanding of “double-edged capitalism” and of the distinction between ‘good’ and ‘bad’ business, and made the case for government action to distinguish between them. He framed this as both a moral and an economic issue: capitalism requires standards. Businesses should be accepted and respected only if they behave responsibly, paying taxes, paying fair wages, avoiding exploitative contracts — and bad businesses should be vilified.

Bobby Duffy, Director of the Policy Institute at King’s College London, framed these contributions within the narrative frame of fairness, highlighting the “sense of unfairness across generations” and the “loss of sense of a possible brighter future” as central to Britain’s political malaise. Bobby argued that what is often described as a “young people’s issue” is a whole‑of-society issue, because most people live in webs of intergenerational connection. When progress stalls, the social fabric frays, and “populist and authoritarian appeals and cultural division thrive.” He argued for fairness not as an add-on to an economic strategy, but as the precondition for its success.

Thursday’s event made clear that a stronger economy and a healthier society is within reach, if the UK is willing to be more strategic and more confident about shaping the economy rather than merely observing it. The prize is a fairer and richer country, more at ease with itself and proud of its place in the world. Closing his contribution, Will Hutton ended the evening with a call to agency and ambition. “It’s in our hands,” he said, “to build a 21st‑century economy… to build a much more solidaristic society… to reinvent our public realm. It’s achievable. It’s feasible. Let’s do it.”

In the months ahead, we at the Fairness Foundation will be continuing to make the case for action to build a fairer economy that works for every community. If you’d like to be involved in that work, please don’t hesitate to get in touch.

You can read the report online or as a PDF. It was also previewed in an Observer article on Sunday 15 March. Please help us by sharing the report on Substack, LinkedIn, Bluesky, Twitter/X or Instagram. Thank you!

OTHER SUPPORTIVE QUOTES

Rain Newton-Smith, Chief Executive of the CBI:

“A relentless focus on investment and measures to promote competition will pay dividends for our growth, productivity and prosperity. Escaping the state we’re in will require bold ideas which nurture our world-leading universities and ignite the innovation which stems from them, from quantum start-ups to clean energy scale-ups. From tax simplification to innovation in public procurement, Will Hutton sets out ideas to challenge our thinking and unlock the business dynamism needed to deliver sustainable growth.”

Andy Haldane, President of the British Chambers of Commerce and former chief economist of the Bank of England:

“It is only by enhancing business dynamism, in particular among its flourishing scale-up companies, that the UK can break free of its growth malaise. This compelling report provides some practical steps for doing so”

Lord Neil Kinnock, former leader of the Labour party:

“Yet again, Will Hutton offers urgent, practical ways to connect Britain’s financial capabilities and fresh productive potential to advance economic strength and social resilience”.

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Across think tanks, policy circles and much of the economics profession, there is a settled view that Britain’s current property tax system is a mess. It is widely seen as unfair, outdated and distortionary. And yet despite the obvious case for change, reform has proven remarkably difficult. For the most part, this isn’t because we don’t know what we’d replace it with. That’s to say, it’s not a technocratic problem. Like so much else at the moment, it is a political problem, downstream from housing and home ownership’s powerful place in the British social imaginary.

Any proposed tax reform, but especially property tax reform, is not therefore received as a neutral attempt to fix a broken system. For the public, it is a threat to something that they have spent decades working towards, the result of thrift and effort. Whereas reformers see abstract capital, voters (at least the ones lucky enough to own property) see security and independence.

In terms of polling, there is broad recognition that the current system is unfair. People know that it is wrong that modest homes in one part of the country are taxed disproportionately more than vastly more expensive properties elsewhere. They can see that stamp duty makes moving harder and that property prices need reevaluating. But recognising unfairness in principle is not the same as backing reform in practice. The moment that any proposal becomes concrete, people want to know what it means for them, not for the system.

Naturally, history matters too. Since the poll tax catastrophe, governments have repeatedly avoided big changes to local taxation. But the situation has got much worse since then. The deeper problem now is that Britain’s economic model has become more structurally dependent on property. As Lisa Adkins (with Melinda Cooper and Martijn Konings) argues in The Asset Economy, housing is no longer just one tenure among others or simply a site of consumption. It has become one of the main mechanisms through which class position and life chances are organised. In an asset economy, inequality is shaped less by income alone than by access to appreciating assets, above all housing. Any reform that would increase taxes on this scarce asset class therefore risks unsettling one of the central ways in which households have come to understand success in a low-growth economy.

This helps to explain why the difficulty of property tax reform is less a failure of political communications and more a feature of the wider settlement, shaped by policy choices that have elevated housing as the central mechanism through which British society now allocates security and reward. For decades, governments have allowed property wealth to substitute for decent public services, stronger wage growth and a more dynamic and innovative economy. Unless and until that changes, any serious attempt to tax property more rationally is therefore likely to meet stiff resistance.

None of this is to suggest that more modest reforms, such as revaluing property or adding new council tax bands, depend on a wholesale transformation of Britain’s economic model. But for those who want something more substantial, the central question may be less how to win the case for reform on its own terms than how to situate it within a broader shift in our political economy, one that gives people more durable sources of security.

This short note is written by our senior researcher, Jack Jeffrey. Jack is planning to do some work on the politics of property taxation over the next few months, and is interested on hearing from readers by email with views on the topic or interest in collaboration.

REPORT PREVIEW: ESCAPING THE STATE WE’RE IN

On a related topic, this Thursday (19 March) we’re publishing an essay by Will Hutton, chair of our advisory board, about how to fix Britain’s political economy. We’ll provide a fuller write-up in next Monday’s Fair Comment, but if you can’t wait until then you can read a preview that was published in yesterday’s Observer (snippets below), or check the Fairness Foundation website from Thursday onwards for the full report.

Thirty years ago, The State We’re In was published… I argued that [Thatcher] had bequeathed a divided and weakened society that actually undermined the economy, and that the better route was a stakeholder, high-investment capitalism that put fairness at its heart… Yet in 2026 we are where I feared in 1996 that we would be. Continued inattention to fixing the financial architecture in which our companies can grow and flourish has meant that many of our great businesses have been dismembered while others decay and stagnate. Too many young companies that might replace them are acquired or sold abroad. Societally, living standards are barely increasing while a century of improving public health and lengthened life expectancy is being reversed, especially in our former industrial heartlands. A great economy cannot be built upon a weak society… So colleagues at the Fairness Foundation and elsewhere, dismayed at the plummeting standing of what on current trends could be Britain’s last Labour government, urged me to remake the arguments today.

Will Hutton, The Observer, 15 March 2026

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On Thursday, the Fairness Foundation and the Black Equity Organisation launched our new joint report in Parliament, revealing the reality of racial wealth inequalities in the UK today.

The event, sponsored by Adam Jogee MP, featured contributions from cross-party parliamentarians and a wide range of stakeholders, including experts from civil society and representatives from the business world. The discussion focused on the central finding of the report: that opportunities to build and hold wealth in the UK remain fundamentally shaped by race and class. The report also sets out a series of recommendations for policymakers on how this gap can be addressed.

The scale of the racial wealth gap has been well-documented. Research from the Runnymede Trust has found that for every £1 owned by White British households, Black African and Bangladeshi households hold only 10p. Median total household wealth (including financial and pension wealth), stands at £321,000 for White British households, compared with under £40,000 for Black African households, and £65,000 for Black Caribbean households.

Our new report brings these figures to life through two illustrative case studies: men of the same age in London, one White British, with access to family wealth, and one Black Caribbean, without. Following their lives across education, work and housing, the research shows how equal salaries do not translate into equal opportunities when access to wealth differs. While the White participant is able to purchase a home and plan for the future, buoyed by parental support and an anticipated inheritance, the Black participant, despite steady employment, remains unable to buy a home because he has no access to intergenerational wealth.

Read the report

Stories like these are likely to become increasingly common in an economy where inherited wealth is playing a growing role in shaping life chances. Over the coming decades, an estimated £7 trillion will be transferred across generations, and it will be distributed very unevenly. Wealth inequality is therefore not only a question of class, but is deeply intertwined with historical and contemporary patterns of racial injustice.

The disparity between ethnic minorities and their white peers today reflects both historical discrimination in housing and employment and more recent failures to address present-day systemic inequalities. These disadvantages have compounded over generations, restricting the opportunities to build wealth. As a result, home ownership, one of the main routes to asset accumulation and intergenerational transfer, remains significantly less common among Black African and Black Caribbean families than among White British households.

Wealth both amplifies advantages and cushions risks. It enables people to accumulate assets, absorb financial shocks and take personal or professional risks. Access to family wealth provides security and freedom, while its absence forces greater caution and self-reliance. The psychological dividend of financial security is unevenly distributed, and the absence of a safety net leaves millions unable to plan or invest in their futures.

The racial wealth gap is the product of cumulative disadvantage, embedded within both economic structures and public policy. Opportunities for home ownership and wealth building remain shaped by race, class and geography. These inequalities are not only unfair; they are economically inefficient and socially corrosive. When millions are locked out of opportunities to accumulate assets, the consequences for economic growth, social cohesion, and democratic trust are profound.

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Addressing wealth inequalities requires action across three areas of policy. First, wealth should be taxed more effectively, including through taxes on income from wealth and transfers of wealth, and the consideration of potentially new taxes on stocks of wealth. Second, wealth ownership must be broadened through policies such as universal basic capital, giving people a foundation for security and opportunity. Third, the outsized role of wealth in shaping life chances should be reduced by strengthening public services, reinforcing the welfare state, and limiting the influence of the wealthy on politics.

Targeted action is also needed to tackle racial wealth gaps specifically. This could include race-equity audits of housing programmes to ensure fair access and monitor outcomes by ethnicity; wealth-tested deposit-match schemes supporting first-time buyers without family assets; stronger enforcement of anti-discrimination rules in the private rented sector; mandatory ethnicity pay-gap reporting with action plans and procurement incentives; and improved pension access through lowering the auto-enrolment earnings threshold.

Our joint report with the Black Equity Organisation adds to the growing body of evidence that the Government has both a moral and economic imperative to close the racial wealth gap - a step that is essential to building a fairer, more resilient and more prosperous society.

“A powerful analysis of the entrenched and widening wealth gap, and its intersection with racial inequality.” Muna Yassin, Chief Executive, Rooted Finance

“Some meetings shift your perspective. This was one of them.” Bola Ogun, Global Head of Reward & Executive Compensation, London Stock Exchange Group

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