Bill Jamieson: Bad timing for you've never had it so good

Falling real incomes; rising inequality; worries over Brexit and the economy as frozen as the weather: our fortunes have rarely seemed so low or our sense of well-being rock bottom.
For many the outlook is a lot less bleak than they imagine. Picture: Getty/iStockphotoFor many the outlook is a lot less bleak than they imagine. Picture: Getty/iStockphoto
For many the outlook is a lot less bleak than they imagine. Picture: Getty/iStockphoto

Nightly news bulletins have become an unrelieved dirge of national anxieties, from the state of the NHS to the latest gloomy forecasts of our fate in a post-Brexit world.

Not that long ago pollsters measured our mood by way of “the Feel-Good Factor”. It’s barely mentioned these days. No magnifying glass would be able to discern it – and any attempt to find it would be met with a cynical guffaw.

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But hard data tells a contrary story. Far from wallowing in financial gloom and fretting about our shrinking fortunes, we are not only wealthier than we have ever been, more comfortable in old age than we have ever been – but happier than we have ever been.

Last week the Office for National Statistics posted the main results of a Wealth and Assets Survey. Running to 70 pages, it covers the period July 2014 to June 2016.

Far from a picture of the UK being little more than a communal Bleak House with the populace queuing at food banks, it reveals some very surprising figures about our household wealth and personal finances.

During this period, the aggregate total net wealth of all households in Great Britain was £12.8 trillion, up by 15 per cent over the previous two years. Scotland’s share of this total is £1.05 trillion. And median household total net wealth – the most common net worth for households – rose by £34,300 to £259,400.

Now much of this upsurge is due to the surge in property wealth. But property is not the only asset to show a marked rise. Aggregate total private pension wealth of households across Great Britain rose 20 per cent to £5.3 trillion on the immediate previous two-year period. And the proportion of individuals with an active private pension is up from 44 per cent to 49 per cent.

Net property wealth – the value of property less any mortgages – ballooned 17 per cent, from £3.9 trillion to £4.6 trillion. Half of all property-owning households had a net property wealth of £173,000 in the period July 2014 to June 2016 – 13 per cent higher than the figure for the period July 2012 to June 2014.

Across the country there are wide differences, with a huge spike in London, where average net property wealth has soared by a third, from £263,000 to £351,000. The figure for Great Britain as a whole is around £170,000. In Scotland, the equivalent figure is around £120,000.

And there are wide differences in how total household wealth is shared. The wealthiest 10 per cent of households – those with assets of more than £1.2 million – owned 44 per cent of total wealth, while the top one per cent had wealth of at least £3.2 million. However, there has been a small decline in income inequality as measured by growth in median disposable income in the past ten years.

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In terms of other assets, the value of household net financial wealth – bank and building society current and savings accounts, Individual Savings Accounts and stocks and shares – rose two per cent to £1.6 trillion on the previous two-year period; while our physical wealth – household contents, possessions and valuables such as antiques, works of art and classic cars – shows a rise of eight per cent to £1.2 trillion.

Household debt has, of course, risen over this period. But how many households have levels of problem debt? Of households in the lowest decile of wealth, 18 per cent said they had “problem debt”, down slightly from 20 per cent in the July 2012-July 2014 period. Scotland scored the lowest on the problem debt survey, cited by just three per cent of households, down from six per cent in the previous survey and markedly lower than the percentage in London (seven per cent) and the north-west of England (10 per cent).

Comprehensive and lengthy though this survey is, it does not give us a full picture, particularly at the lower end of the wealth spectrum where pressures on weekly spending have been intense. And the figures are slightly dated, stopping at mid-2016 and thus not reflecting the immediate effects of the Brexit vote which currently dominates business and political commentary.

However, an ONS survey released last autumn on UK personal wellbeing between April 2016 and March 2017 brings us a little more up to date. The figures, says the ONS, “may surprise some”.

Indeed they do. The survey revealed that despite the bleak economic forecasts and febrile commentary on Brexit negotiations, the survey continued to show small year-on-year improvements in average life satisfaction ratings.

Between the years ending March 2016 and 2017, there has been a “statistically significant increase” in the proportion of people reporting very high levels of life satisfaction (up from 27 per cent to 30 per cent) and feeling that things done in life are worthwhile.

The proportion of people reporting very high levels of happiness has climbed from around 32 per cent in 2012 to 35 per cent. The average (mean) ratings across the four measures of personal well-being in the year ending March 2017 were: 7.7 out of 10 for life satisfaction; 7.9 out of 10 for feeling that “what you do in life is worthwhile”; 7.5 out of 10 for “happiness yesterday” and 2.9 out of 10 for “anxiety yesterday”.

Factors influencing quality of life and well-being range across employment, job satisfaction, health, personal relationships and personal financial security. But it is remarkable that, though over the year covered by the survey, “various situations of uncertainty, not least in political terms have unfolded in the UK… consumers reported perceived improvements in their own financial situation and the general economic situation”.

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Might the figures be duff? Or are we truly not yet as poor and downcast as we are so often portrayed? Whichever it is, attempting to lift the national mood at this time is perhaps best avoided: it may well result in only making us more miserable.