By Laura Perrins
The finance bill has completed its second reading in the House of Commons and now proceeds to committee stage. It is the fourth Budget by the coalition government and it is the fourth time they have failed to deliver on their promise in the coalition agreement to allow for transferrable tax allowance between married couples.
Not only is this detrimental to representative democracy, it continues to perpetrate a gross unfairness in the tax system towards single-income families.
One of the frequent complaints made when single-income families argue for a transferrable tax allowance is that the tax-payer should not have to 'fund another's lifestyle choice to have children'. But that is not what we are asking for.
Single-income families are currently actively discriminated against within the tax system. A single-income family on an average income of £36,000 per annum is disproportionately taxed compared to a double-income family on the same amount. On this amount the single-income family will pay almost £9,000 in tax and national insurance, whereas a double-income family on exactly the same amount pays about £6,500. This means a single-income family pays £211 more per month. Why?
Now, this maybe small change in fashionable Notting Hill and Pimlico but it is a serious amount of money to the average family and I find it shocking that this gross unfairness and discrimination has been allowed to continue for so long. The French would be at the barricades.
Incidentally, these figures exclude the proposed child-care allowance, which is worth up to £2,400 for a family with two children that have external childcare costs.
But remember if a family have granny looking after their children they are barred from the scheme; if mum does some part-time work during school hours this family is barred from the scheme; if mum works less than 16 hours a week this family is barred from the scheme; and, if you are a single mum who thinks her infant deserves to have the last remaining parent there to take care of him she is barred from the scheme.
But if you are a household that brings in up to £300,000 – let's say that again £300,000 – you are entitled to claim this allowance. Now let's be clear, this scheme has nothing to do with helping the average income family and everything to do with paying for the nannies and au-pairs in some leafy London suburb. In contrast, the Institute of Fiscal Studies has shown that 70% of the benefit of a marriage tax allowance will go to those in the lower half of the income distribution.
Many mums say that if they could afford to they would like to spend more time with their children, particularly when they are young – some stopping work completely, and some going part-time until the children reach school age. Allowing for a transferrable tax allowance would go some way to facilitating this.
It must be remembered that the UK always used to recognise marriage in the tax system. The practice was only abandoned completely in the financial year 1999-2000. This is in contrast to 13 OECD countries that allow or require spouses to file a joint tax return. As a consequence the UK system of individual taxation treats the family simply as a group of separate individuals and the children are therefore an inconvenient addition that must be cared for while both parents work.
But this is not what most families want. Why does the coalition continue to ignore this reality? It is time for MPs to stand up for the average British family; isn't this what they are there to do?
Tim Loughton MP plans to table amendments to the finance bill to allow for a transferrable tax allowance for married couples; there is no reason why this should not be supported.
One minister who should be first in line to support such an amendment is Michael Gove. In discussing Margaret Thatcher's legacy, he said he "admired her for her grit and determination in restoring the economy to health" but also that "there is also a recognition that social bonds need to be nurtured more carefully if we are all to see through difficult economic times together and emerge stronger and more united at the other end". He goes on: "Time has underlined how crucial it is to ensure that we also applaud the values of care, nurture and solidarity that protect the vulnerable at times of change."
This is an astonishing and welcome statement. Is Michael Gove the first Cabinet minister to come out and say that social bonds and caring duties should not be sacrificed on the altar of economic growth?
If so, then he should condemn the latest budget proposals that seek to support only mothers who work outside the home and discriminate against those who work inside it. He should be vocal in his support for mothers who do decide to care for their children themselves and he should support the call for recognising caring duties within the tax system.
Margaret Thatcher never sought to abolish child benefit for some families and she resisted great pressure to provide tax relief or subsidies for external childcare.
The very first 'social bond' ever created is that between a mother and her child and the primary nurturer of the child is his mother. He knows her voice before he is even born; when he is born it is her heartbeat he recognises. This government's policies, particularly their taxation policy, ignore this.
Why has Mr Gove been so silent in the face of this unrelenting pressure on mums to leave their children in the care of others? On his own views he should be clamouring to support Tim Loughton's amendment.
If the coalition wants to be remembered as family-friendly and wish to make Britain a more cohesive society they should start treating the family as a co-dependent team and do away with the legal and economic fiction that parents of children work in an individual and isolated way.
The modern family is a mutually cooperative unit and a transferrable tax allowance would go some way to acknowledging this reality. Individual taxation is archaic.
Laura Perrins is a former barrister and stay at home mother with two small children who campaigns for Mothers at Home Matter.
The opinions in politics.co.uk's Comment and Analysis section are those of the author and are no reflection of the views of the website or its owners.