Five problems with the Tories' married couple's tax allowance

Including, only a third of married couples will actually gain, it discriminates against single parents and it reduces work incentives.

With Tory MPs continuing to agitate for the introduction of a married couple's tax allowance, Treasury minister David Gauke has written a letter to backbenchers reassuring them that the government "will legislate for this in this Parliament". 

The policy, as outlined in the 2010 Conservative manifesto, would allow individuals not using all of their personal tax allowance (because their income is less than the current threshold of £9,440) to transfer up to £750 of this unused allowance to their spouse or civil partner, reducing the latter's tax bill by up to £150. It would apply only to couples where the higher-income member is a basic rate taxpayer, with gains tapered away from higher earners. The proposal was included in the Tory manifesto and the coalition agreement provided the Lib Dems with the right to abstain, so Tory MPs are understandably angered by the government's tardiness. But as I show below, there are at least five good reasons why George Osborne (one of the most socially liberal MPs) shows every sign of wanting to abandon it. 

1. Only a third of married couples will​ benefit 

Despite the broad promise to "recognise marriage" in the tax system, most married couples won't gain from it. In 2010, the IFS estimated that just four million out of 12.3 million married couples would benefit (at a cost of £550m), including only 2.5 million of the 8.7 million married couples with someone in work. The remaining 1.5 million gainers are mostly married pensioners. As the IFS noted, "The policy is not, therefore, a general recognition of marriage in the tax system, as it affects only 32% of married couples and 29% of non-pensioner married couples." 

The policy could, of course, be redesigned so that all or most married couples benefit but this, not least for the fiscally conservative Osborne, would be prohibitively expensive. 

2. It discriminates against single parents, widows and widowers and more

In his recent GQ article, Andy Coulson described the perception that David Cameron does not like single parents as "electoral halitosis", but this policy unambiguously discriminates against them. Among those who also don't gain from the policy, as Don't Judge My Family notes, are widows and widowers, people who leave abusive relationships and working couples (discussed below). Is Osborne comfortable with tilting the tax system against them? In addition, if, as previously suggested, those in civil partnerships benefit from the measure, it will become even harder for the government to argue against introducing them for heterosexual couples (a policy that, unlike equal marriage, really would undermine marriage). 

3. It will reduce work incentives

Through policies such as reserving childcare support for dual-earner couples, Osborne has sought to increase work incentives, but this measure will reduce them. Since only those couples with one earner with an income above the personal allowance will benefit, it will encourage actual or potential second earners to stay at home. 

4. There's no evidence that marriage improves child outcomes

One of the main justifications for the policy is that marriage is beneficial for children. As Iain Duncan Smith has argued, "You cannot mend Britain’s broken society unless you support and value the institution which is at the heart of a stable society". But while children born to married couples have better developmental outcomes than those born to cohabiting couples, there's no evidence that this is due to marriage itself. Instead, as the IFS and others have argued, it is more likely due to the fact that better educated and higher-earning couples are more likely to get married. The right has confused correlation and cause. 

5. It will further complicate the tax system

Osborne has made much of his commitment to simplifying the tax system, but this proposal will create a new layer of complexity. To summarise, it will introduce a transferable allowance restricted to a third of married couples, capped at £750 and tapered away from higher-rate taxpayers. As the IFS points out, "Simpler ways to provide support to low- to middle income married couples would include introducing a married couples’ ‘premium’ into working tax credit and pension credit." 

David Cameron speaks with scientists before opening the Li Ka Shing Centre for Health Information and Discovery at Oxford University on May 3, 2013. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

Photo:Getty
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Labour is a pioneer in fighting sexism. That doesn't mean there's no sexism in Labour

While we campaign against misogyny, we must not fall into the trap of thinking Labour is above it; doing so lets women members down and puts the party in danger of not taking them seriously when they report incidents. 

I’m in the Labour party to fight for equality. I cheered when Labour announced that one of its three Budget tests was ensuring the burden of cuts didn’t fall on women. I celebrated the party’s record of winning rights for women on International Women’s Day. And I marched with Labour women to end male violence against women and girls.

I’m proud of the work we’re doing for women across the country. But, as the Labour party fights for me to feel safer in society, I still feel unsafe in the Labour party.

These problems are not unique to the Labour party; misogyny is everywhere in politics. You just have to look on Twitter to see women MPs – and any woman who speaks out – receiving rape and death threats. Women at political events are subject to threatening behaviour and sexual harassment. Sexism and violence against women at its heart is about power and control. And, as we all know, nowhere is power more highly-prized and sought-after than in politics.

While we campaign against misogyny, we must not fall into the trap of thinking Labour is above it; doing so lets women members down and puts the party in danger of not taking them seriously when they report incidents. 

The House of Commons’ women and equalities committee recently stated that political parties should have robust procedures in place to prevent intimidation, bullying or sexual harassment. The committee looked at this thanks to the work of Gavin Shuker, who has helped in taking up this issue since we first started highlighting it. Labour should follow this advice, put its values into action and change its structures and culture if we are to make our party safe for women.

We need thorough and enforced codes of conduct: online, offline and at all levels of the party, from branches to the parliamentary Labour party. These should be made clear to everyone upon joining, include reminders at the start of meetings and be up in every campaign office in the country.

Too many members – particularly new and young members – say they don’t know how to report incidents or what will happen if they do. This information should be given to all members, made easily available on the website and circulated to all local parties.

Too many people – including MPs and local party leaders – still say they wouldn’t know what to do if a local member told them they had been sexually harassed. All staff members and people in positions of responsibility should be given training, so they can support members and feel comfortable responding to issues.

Having a third party organisation or individual to deal with complaints of this nature would be a huge help too. Their contact details should be easy to find on the website. This organisation should, crucially, be independent of influence from elsewhere in the party. This would allow them to perform their role without political pressures or bias. We need a system that gives members confidence that they will be treated fairly, not one where members are worried about reporting incidents because the man in question holds power, has certain political allies or is a friend or colleague of the person you are supposed to complain to.

Giving this third party the resources and access they need to identify issues within our party and recommend further changes to the NEC would help to begin a continuous process of improving both our structures and culture.

Labour should champion a more open culture, where people feel able to report incidents and don't have to worry about ruining their career or facing political repercussions if they do so. Problems should not be brushed under the carpet. It takes bravery to admit your faults. But, until these problems are faced head-on, they will not go away.

Being the party of equality does not mean Labour is immune to misogyny and sexual harassment, but it does mean it should lead the way on tackling it.

Now is the time for Labour to practice what it preaches and prove it is serious about women’s equality.

Bex Bailey was on Labour’s national executive committee from 2014 to 2016.