Honestly, I don't know. I haven't given the abstract concept enough thought or done enough research to have a well-reasoned opinion.
However, I do think it is "bad thing" for members of the elite to believe that we live in a meritocracy – when we do not, IMO. Skimming that Guardian article, I think my feeling is similar to the criticism put forth there. The notion that we live in a meritocracy creates a sense of entitlement and superiority in the elite. That is, if you believe we live in a true meritocracy, then those on top are there because they're smarter and harder working, and those on the bottom are there because they're less intelligent and/or aren't working as hard. Said more simply, meritocracy results in the feeling that you deserve your riches, and they deserve their poverty.
Whereas, in reality as I see it, your financial success is dependent on many factors outside of your control. Sure, most successful people are fairly smart and work hard, but many less successful people also have those qualities. The other factors contributing to success are things largely summed up by Warren Buffett's notion of the "Ovarian Lottery".
I'm not advocating a meritocracy. I'm advocating an honest assessment of society and the factors contributing to financial success.