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Divided Scotland

Probe reveals shocking pay inequalities
Pat Rafferty, Unite Scottish secretary, Wednesday, August 30th, 2017

Picture it if you will. You are at a huge wedding reception and 100 guests are assembled in the hotel gardens sipping the Prosecco on offer. The hotel staff wheel out the wedding cake. It is set out in four equally sized tiers. Suddenly 10 of the guests step forward and without any hesitation devour two of the four tiers, leaving only two for the other 90 guests. Cue general outrage.


You might say this could never happen but it is exactly what’s going on across Britain, where the richest 10 per cent hold 45 per cent of the wealth in the country. The Herald investigation about the pay of Scotland’s top chief executives revealed a divided Scotland – a Scotland where the chief executive of RBS has a top line on his pay packet of £65,000 a week and a 20 year old shop worker on the minimum wage of £5.60 an hour gets £225 a week before tax. That’s an inequality ratio of almost 300-1.


The Herald investigation looked at 39 top companies. In 10 of them the chief executive earns more than a £1m a year. The Herald identified that the biggest earner of them all is the the chief executive of RBS – with a top line of £3.5m a year.


RBS is currently running a massive advertising campaign to explain that it is not the Royal Bank ‘of’ Scotland but the Royal Bank ‘for’ Scotland. It’s actually the Royal Bank ‘for’ its senior executives filling their boots at the taxpayers’ expense. At the opposite end of the scale to the RBS fat cats there are more than 50,000 people on zero hours contracts and rock bottom wages.


Bad for business

The question about reducing inequality isn’t just a moral one. As the Oxford professor Danny Dorling points out in “The Equality Effect”, inequality is bad for business. He recognises that countries which tolerate greater income equalities also have greater health inequalities, greater educational inequalities and a dangerous lack of social cohesion. He says the UK now has a greater inequality ratio than Africa’s Burkina Faso and the USA is more unequal than Uganda.


Unite Scotland is in favour of the Labour Party’s policy on a much more progressive income tax system. And before we hear the howls of indignation from the ‘deserving rich’ we say simply there is no way those at the top of big companies who award themselves countless millions deserve it. There is nothing you can do that justifies a salary of £3.5m.


A progressive income tax structure on income and inheritance could transform Scotland. And even a relatively modest tax increase for the super rich could provide a financial foundation on which to build a £10.00 an hour minimum wage. If the Scottish government had the courage to use its taxation powers radically that could become an inspirational reality.


Unite Scotland recognises that a Scottish tax revolution is our only hope. Inequality is one of the great shrines where the Tories worship so it’s inconceivable they’ll do anything that makes a real difference. They think the rich don’t have enough money and the poor have too much.


But those on zero hours contracts and the families dependent on food banks can’t wait for some future fiscal salvation. Enter Unite Scotland. Building the trade union movement is the answer for the here and now. Where the union is strong decent wage rates replace poverty pay. Rights replace exploitation. And hope is the future. Join Unite. Unite to win.


This comment first appeared in The Herald, August 30


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