Tuesday, July 10, 2007

Guardian nail Tory £20 a week marriage allowance

The Guardian leader this morning has helpfully nailed the Tory £20 a week marriage allowance idea:

Pupils called Arabella get better exam results than the average. That does not mean that being called Arabella makes a girl smarter, only that the name is more common among families that offer a favourable start in life. Marriage, too, is often a marker of a happy situation, rather than its underlying cause. Yet the Conservatives, at least on the evidence of their social justice group's report yesterday, fail to appreciate this. It proposed tax breaks for married people, and highlighted statistics showing that parents who choose to wed stick together. The combined effect was to hint, misleadingly, that if people were financially enticed to walk down the aisle then there would be fewer unhappy families.

...Marriage is one choice that people make that would be made financially more attractive. They could get tax breaks worth up to £6bn. That is big money, and - even given reasonable concerns about how some couples fare with the current tax credits - it is not the right priority, for children raised by lone parents still face twice the risk of poverty. One effect of the plan would be to reward another choice made by some married people, namely to stay at home - spouses, with or without children, who wanted to do this would be free to pass their tax allowance to the breadwinner. Lone parents, by contrast, would have less choice than now in deciding whether to seek work - even those with children as young as five would see their benefits cut if they did not. Sick and disabled people, similarly, would not, as now, be encouraged to work, but instead find themselves obliged to.

The article calls the Tory report "a retreat to the past" and says that the proposals would not be self-funding:

Embracing big tax cuts for married couples would introduce a political dividing line that risks making the Tories look nostalgic for a past that will not return. It could also land his potential government with a bill that it does not know how it would pay.

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