'Wealth gap puts black people at a disadvantage'

Jimmy Nsubuga, Voice Writer

ETHNIC MINORITIES in the United Kingdom (UK) lag behind other groups in accumulating wealth, which puts them at a disadvantage, a think tank has said.

The Runnymede Trust said the skills of migrants and people from ethnic minorities are also being wasted due to a huge racial wealth gap.

Figures from the Department of Work and Pensions show 60 per cent of all black and Asian households have no savings whereas only 33 per cent of white people are in the same boat.

Omar Khan, director of policy research at the Runnymede Trust, said that addressing the inequality would be a positive step for social cohesion, allowing different racial groups to interact on a level playing field.

He said the majority of black students are at a disadvantage because they do not have the safety net that wealthier students have.

"Children of parents who don't have assets struggle to access higher education or training, and often have to take the first job on offer," Khan said. "Not having savings is a barrier for poorer students to many industries where being able to work for free in order to gain experience is required."

wealth-building initiatives

Khan pinned the blame for the disparity on the low-income jobs of ethnic minorities and migrants, and he wants the government to address the problem by introducing wealth-building policies.

"Current wealth-building initiatives such as ISAs (Individual Savings Account) are more geared towards high-income earners who can afford to save large sums of money. The government should reintroduce the Child Trust Fund, which was abolished last year," he said.

The Child Trust Fund was a savings account which UK-born children would be able to access when they turn 18.

Khan said policies like this not only enhance economic efficiency and equal opportunity, but also give migrants and minorities a stake in our societies and encourage greater public participation.