The wealth of Scottish households has grown rapidly in recent years and now exceeds £1 trillion for the first time. But from a living standards perspective, what matters is how that wealth – including property, pensions and savings – is shared.
The report explores some of the key inequalities when it comes to wealth in Scotland, highlighting:
- Wealth has grown much faster than incomes: Scottish wealth has grown from being five times GDP to more than seven times over the last decade. This has made it much harder to close wealth gaps by earning and saving.
- Generational divides have opened up: Recent wealth booms have largely benefitted older generations, with no cohort born since 1965 seeing higher wealth than their predecessors at the same age. At age 35, those born in the second half of the 1970s had one third less wealth than those born just five years before (£33,000 vs £52,000.
- Inheritances are booming: What you inherit, rather than what you earn, is set to become much more important determinant of your lifetime living standards in the years ahead.
- Wealth is very unequal: wealth in Scotland is nearly twice as unequally held as income. 25 per cent of Scottish people have less than £500 of net savings, and 7 per cent have zero savings or are in debt.
- The biggest wealth tax is devolved: while wealth has grown in recent years, the same is not true of wealth taxation. The biggest wealth tax (Council Tax) is fully devolved and recent modest reforms have improved council tax in Scotland, in marked contrast to the lack of progress in England.
The report argues that wealth should play a bigger role in the national conversation when it comes to inequality, but also as a potential source of tax revenues to address the issues Scotland faces.