From the end of the Second World War until Margaret Thatcher's Government took office in 1979, inequality of income and wealth declined in the United Kingdom.

The conventional measure of inequality, the Gini coefficient (where a higher number means less equality) fell back from the early 1980s until the mid 1990s. The Major Government oversaw a modest reversal of that trend, but since 2000 it has begun to rise again - not the outcome that most people expected when Labour was elected in 1997.

This is not because the poor are relatively poorer. Indeed the tax and benefit changes introduced by Gordon Brown have improved the fortunes of the lowest earners. The reason is the growth of a new class of super-rich, with earnings (or shall we say income) beyond the wildest dreams of avarice. A vivid way of thinking about the change is to imagine the distribution of income as a kind of onion-dome shape. The bottom is flat, as the poor have been pushed up closer to the middling sort, while the incomes of a small number of wealthy folk soar up to the skies in a thin sharp spire.

How has this happened? Who are these happy few? Who let the Gini out of the bottle? These are the questions that Robert Peston, the BBC business editor, seeks to answer in this muscular, if mistitled, book.

It is not a statistical analysis. Peston is happy to leave that dull stuff to my colleagues at the London School of Economics. Nor is it an Anthony Sampson-style “anatomy of Britain”. Peston is a painter of vignettes that make up a compelling portrait of early 21st-century “casino capitalism”, as the French described it until they discovered Société Générale, their own loss-making casino on the outskirts of Paris.

Some of the tales are familiar. He takes us through the thrills and spills of the Bhs boss Sir Philip Green's brilliant career, including breathless descriptions of his on-again off-again love affair with Sir Stuart Rose, chief executive of Marks & Spencer.

Then we read a blow-by-blow account of the fall and resurrection of M&S: fascinating, but too long. I wished I could, like a Marks shopper, return it for a new one in a smaller size. I grew up in a household where only St Michael could touch your private parts and, unlike Jeremy Paxman, I have always felt well supported by him, but this is more than I need to know about its boardroom struggles.

We are taken on a whistle-stop tour of Mayfair's finest hedge fund and private equity boutiques, then on to the sorting offices of Royal Mail, to explore the world of another corporate superstar, its chairman, the “tieless, stubble-chinned” Allan Leighton.

Leighton is, in Peston's view, “a different kind of public servant”, a tough operator, we hear, although “quite a lot of what he says is a hair's breadth away from nonsense”. We hear a little, too, about the egregious Sir Richard Branson, “who seems to have hooked Gordon Brown” as effectively as he did Tony Blair, although it is not at all clear what benefit either politician has secured from this dangerous liaison.

So far, so plutocratic. It is a little less clear how Northern Rock fits into this catalogue of self-enrichment, but Peston cannot resist explaining how his scoop nearly broke the Bank of England. In fact, Who Runs Britain is a kind of sentimental education, a Bildungs-roman in which our hero discovers that the inhabitants of the village - the City of London - which he has faithfully chronicled for a quarter of a century, have been getting seriously rich under his very nose. Furthermore, Brown, of whom Peston wrote a penetrating but sympathetic biography, has been complicit.

Brown presided over a tax system that encouraged the bubble now bursting all over. “As a direct result of Brown's policies, the economic gap between North and South has widened.” And, worse, “on his watch the super-rich and heads of multinational businesses have gained more direct access to government than they have enjoyed for decades”.

Does all this matter? Is Peston just another practitioner of the politics of envy, unhappy with his paltry BBC pay?

I think not. His peroration, in which he invokes the prospect of a world in which “millions of citizens could ultimately feel dispossessed, alienated, powerless”, may be over the top. But he makes the important point that the rich depend on social stability, which is in turn sustained by institutions funded by the tax take from those of us not wealthy or mobile enough to escape the clutches of Her Majesty's Revenue and Customs.

At a Budget preparation meeting in 1985, when I was working in the Treasury, the Chancellor, Nigel Lawson, threw out a suggestion that top-rate taxes be cut further, and replaced by a minimum tax rate, with no exemptions.

The head of the Inland Revenue, as it was then called, a sardonic character named Lawrence Airey, responded. “Your argument, Chancellor, would I presume be that everyone should pay some tax, no matter how rich they are.”

Gordon Brown does not seem to agree. Peston, his Boswell, has changed his mind. This is an interesting moment in the life of the Brown Government, as it debates capital gains and “non-domicile” taxes. For those who wish to understand the struggle in its breast, Who Runs Britain is essential reading.

Who Runs Britain? By Robert Peston
Hodder, £20

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