Income inequality ‘harmful to democracy’, says committee

The richest one per cent have now accumulated more wealth than the rest of the world put together. However, although it is acknowledged that a certain level of inequality may stimulate individual ambition and overall growth, levels of inequality in Europe have “now gone far beyond the limits of healthy competition,” the PACE Committee on Social Affairs said today. In the long term, these inequalities are “harmful to social cohesion, economic development and democracy”.

Adopting a draft resolution based on a report by Andrej Hunko (Germany, UEL), the members called on European governments to make the fight against income equality a “political priority” and develop “comprehensive and effective” national strategies.

In particular, they called for a reduction in the current levels of precarious employment and for employees to be provided with “more stable” work prospects, while advocating investment in training programmes and continuous training for all workers on a lifelong basis, as well as increased levels of female participation in the labour market and the introduction of “a sufficiently high minimum wage”.

In addition, they stressed the need to make taxation systems more progressive, in particular by “increasing the tax rates for higher incomes”, while significantly lowering pressure on “at risk of poverty” groups. Taxation of wealth, capital gains and inheritance should be reviewed with a view to reducing, and increasing transparency on, tax incentives of any kind.

As regards labour market institutions, the draft resolution calls for the negative trends that have weakened collective bargaining institutions and coverage in the past to be reversed and for social dialogue to be strengthened as a means of fighting income inequalities.

The Assembly will debate the draft resolution during the spring session (Strasbourg, 24-28 April).