Inequality is a Policy Choice

Despite the biggest global health emergency in a century, most of the world’s governments failed to take major concrete steps to mitigate this dangerous rise in inequality.

Since 2017, Oxfam and DFI have partnered to create the Commitment to Reducing Inequality (CRI) Index. This recently released 2022 report is the first detailed analysis looking at governments’ policies and actions to fight inequality during the first two years of the pandemic.

The CRI reviews the spending, tax and labour policies and actions of 161 governments during 2020–2022, ranking the extent to which they are taking steps to reduce inequality in their society.

Oxfam and DFI's Commitment to Reducing Inequality Index looks at inequality around the world, and highlights some of the choices being made by governments around the world right now.

Bad choices

COVID-19 has increased inequality worldwide, as the poorest and most vulnerable people were hit hardest by both the disease and its profound economic impacts. Yet most of the world’s governments failed to take major concrete steps to mitigate this dangerous rise in inequality.

France cut corporate tax rates and eliminated their wealth tax.

They fell 5 places in this year’s Inequality Index.

Bulgaria failed to raise its minimum wage in line with the growth and has a deeply unfair tax system. Households’ out of pocket health spending is 9th highest in the world.

They dropped 20 places in this year’s Inequality Index.

Sri Lanka is the sixth lowest public services spender, and has cut health and education budget shares and taxes on the richest and corporations.

They dropped 17 places in this year’s Inequality Index.

South Sudan is the lowest spender on education, health and social protection in the world. It has cut its health budget by a half to a mere 1.1% of its budget and education by 43%

They remained in last place in this year’s Inequality Index.

Ghana cut education, health and social protection budgets share, and has announced further austerity measures to deal with the debt situation. 55% of Ghanaians- 17 million- lack coverage of basic healthcare.

They fell 25 positions in the public services pillar of this year’s Inequality Index.

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Good choices

Even in the midst of these multiple crises, some governments are showing that another way is possible. That the road to greater equality is a practical alternative journey that can be taken by all nations.

South Korea increased taxes on the rich, and boosted social spending. It has the highest secondary school completion rate by the poorest students in the world.

They rose 22 places in this year’s Inequality Index.

The Occupied Palestinian Territory increased their health budget by a third. it has halved proportion of its citizens who pay more than 10% of their income for health care in recent years.

They rose 19 places in the 2022 in this year’s Inequality Index.

Nepal, one of the poorest countries, increased its budget share of health spending by 50%.

They rose 3 places in the public services pillar in this year’s Inequality Index.

Barbados introduced a comprehensive set of laws to improve women’s labour rights.

They rose 24 places in worker’s rights pillar in this year’s Inequality Index.

Senegal increased share of its education by a fifth and social protection by a third. It has one of the highest tax rates on the richest in West Africa and has increased its tax collection by eliminating tax exemptions and combating tax dodging.

They rose 10 places in this year’s index.

As these lists make clear, inequality is a policy choice. And unless urgent action is taken by governments and the international community, the profound increase in inequality and poverty driven by COVID-19 will rapidly become permanent, and governments will lose a decade in fighting it.?

What choices are your leaders making? Find out in Oxfam and DFI’s Inequality Index.