Why a married couples' tax allowance could be deadly for the Tories

Clegg's argument that any spare money should be used to support "all working families" is a powerful dividing line with the Conservatives.

After three years in government, it is only now that David Cameron is talking seriously about introducing a married couples' tax allowance, promising to announce plans "very shortly". The proposal was included in the 2010 Conservative manifesto and the Coalition Agreement (which gave the Lib Dems the right to abstain), so what's taken him so long? The reason for the delay, I suspect, is that influential Tories, most notably George Osborne (one of the most socially liberal MPs), recognise that it is a profoundly flawed measure. 

As Nick Clegg observed at his press conference this morning, a policy that "basically says to people who are not married: you will pay more tax than people who are married" will seem odd to many voters. Clegg's argument that a spare £550m would be better spent "on all working families" is a powerful dividing line with the Tories. 

It's true that a YouGov poll in January found that 53 per cent of the public support the introduction of a  tax allowance, with just 36 per cent opposed, but this total is likely to fall when voters find out that less than a third of married couples would benefit. As outlined in the Tory manifesto, only those couples in which one member is not using all of their personal tax allowance would gain (they could transfer £750 of their unused allowance to their spouse), with higher-rate taxpayers excluded. 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. Clegg's argument that any spare money would be better used on raising the personal allowance is likely to resonate.

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. The policy will also alienate the young, socially liberal voters that the Tories need to win over if they are to ever secure a majority (18-24-year-olds opposed the policy by 40-36 in the YouGov poll). 

In reaffirming his support for an allowance, Cameron may enhance his standing with his party and with traditional Conservative voters but only at the cost of further limiting the appeal of the Tory brand. 

The decoration of a wedding cake is seen at the wedding fair on January 8, 2012 in the western German city of Essen. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

Photo: Getty
Show Hide image

Like it or hate it, it doesn't matter: Brexit is happening, and we've got to make a success of it

It's time to stop complaining and start campaigning, says Stella Creasy.

A shortage of Marmite, arguments over exporting jam and angry Belgians. And that’s just this month.  As the Canadian trade deal stalls, and the government decides which cottage industry its will pick next as saviour for the nation, the British people are still no clearer getting an answer to what Brexit actually means. And they are also no clearer as to how they can have a say in how that question is answered.

To date there have been three stages to Brexit. The first was ideological: an ever-rising euroscepticism, rooted in a feeling that the costs the compromises working with others require were not comparable to the benefits. It oozed out, almost unnoticed, from its dormant home deep in the Labour left and the Tory right, stoked by Ukip to devastating effect.

The second stage was the campaign of that referendum itself: a focus on immigration over-riding a wider debate about free trade, and underpinned by the tempting and vague claim that, in an unstable, unfair world, control could be taken back. With any deal dependent on the agreement of twenty eight other countries, it has already proved a hollow victory.

For the last few months, these consequences of these two stages have dominated discussion, generating heat, but not light about what happens next. Neither has anything helped to bring back together those who feel their lives are increasingly at the mercy of a political and economic elite and those who fear Britain is retreating from being a world leader to a back water.

Little wonder the analogy most commonly and easily reached for by commentators has been that of a divorce. They speculate our coming separation from our EU partners is going to be messy, combative and rancorous. Trash talk from some - including those in charge of negotiating -  further feeds this perception. That’s why it is time for all sides to push onto Brexit part three: the practical stage. How and when is it actually going to happen?

A more constructive framework to use than marriage is one of a changing business, rather than a changing relationship. Whatever the solid economic benefits of EU membership, the British people decided the social and democratic costs had become too great. So now we must adapt.

Brexit should be as much about innovating in what we make and create as it is about seeking to renew our trading deals with the world. New products must be sought alongside new markets. This doesn’t have to mean cutting corners or cutting jobs, but it does mean being prepared to learn new skills and invest in helping those in industries that are struggling to make this leap to move on. The UK has an incredible and varied set of services and products to offer the world, but will need to focus on what we do well and uniquely here to thrive. This is easier said than done, but can also offer hope. Specialising and skilling up also means we can resist those who want us to jettison hard-won environmental and social protections as an alternative. 

Most accept such a transition will take time. But what is contested is that it will require openness. However, handing the public a done deal - however well mediated - will do little to address the division within our country. Ensuring the best deal in a way that can garner the public support it needs to work requires strong feedback channels. That is why transparency about the government's plans for Brexit is so important. Of course, a balance needs to be struck with the need to protect negotiating positions, but scrutiny by parliament- and by extension the public- will be vital. With so many differing factors at stake and choices to be made, MPs have to be able and willing to bring their constituents into the discussion not just about what Brexit actually entails, but also what kind of country Britain will be during and after the result - and their role in making it happen. 

Those who want to claim the engagement of parliament and the public undermines the referendum result are still in stages one and two of this debate, looking for someone to blame for past injustices, not building a better future for all. Our Marmite may be safe for the moment, but Brexit can’t remain a love it or hate it phenomenon. It’s time for everyone to get practical.