After reviewing evidence on long-run national trends in inequality since the 1320s and the history of ideas and measures of inequality, the focus is on the history of institutions which have influenced the trends in inequality. Here, the major surprise for many will be to learn that a progressively funded universal social security, health and welfare system was instituted by Elizabeth I in 1601. The welfare state was not invented but restored by the Labour government of 1945–51, decreasing inequalities substantially. In 1834, the parliament had reduced the Elizabethan Poor Law to a deterrent workhouse system, its funding halved in accord with the ideas of Bentham, Malthus and economic liberalism. Since 1979, the successor ideology of neo-liberalism has again increased inequality by reducing the progressivity of taxes and restraining expenditure on public services. After 1979, child poverty more than doubled to over 30% and has never returned to previous lower levels.