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Tuesday, 5th August 2008

Will Cameron and Osborne divorce over marriage?

Peter Hoskin 8:58am

I’d recommend you read Rachel Sylvester’s column in today’s Times. In it, she identifies a split between David Cameron and George Osborne on recognising marriage in the tax system. Cameron’s extremely keen on the idea, and wants to reintroduce the married couple’s allowance. Osborne, on the other hand, isn’t and doesn’t. Here’s the key passage:

"Mr Osborne disagrees. For him, it is not the State's job to tell people how to live their lives. He would prefer to use scarce Treasury resources to support parents, whatever family structure they are in, than to reward a childless millionaire hedge fund manager who happens to be married to a lady who likes to lunch. He is concerned that the Tories will alienate voters if they appear to stigmatise single mothers and cohabiting couples. 'There is a substantial disagreement,' one insider says. 'It's hard to see a way through.'"
It’s difficult to know what to make of any such split. Of course, it’s noteworthy that “there is now a real tension about a tax policy” between Cameron and Osborne. But that tension is unlikely, by itself, to put an end to their relationship.

It could, though, herald a pandemic of similar splits throughout Tory ranks. With “nudging” now the idea du jour in Conservative circles, every policy will increasingly be interrogated on whether it’s a permissible “nudge” or an all-too-hefty “push”.  It's a useful criterion.  But, as the split over marriage demonstrates, few cases are clear-cut.  Meaning there's plenty of scope for disagreement.

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Comments

Ruairidh

August 5th, 2008 9:50am

Obsborne needs to consider the fact that the state already tells people how to lead their lives by making it financially advantageous for many couples to split. In other words the current tax and benefit system is not agnostic to the relationship of a child’s parents. At the moment certain measures and benefits come into affect if there is a break up. Any attempt to redress this balance, even to make the state agnostic on marraige, will mean providing more support to married parents at the (relevant) expense of single parents.

Jane

August 5th, 2008 9:53am

I agree with George Osborne and believe his arguments are in accord with public opinion.

Richard Nabavi

August 5th, 2008 10:01am

Sounds a bit far-fetched to call this a 'split'. It sounds more like a minor difference of emphasis.

No story here, I think.

Ian C

August 5th, 2008 10:30am

Simple solution: remove all personal tax allowances for those with a taxable income above a certain level. It heads many things off that are criticsed about high earners, eg rates of tax, for whom these allowances are paltry. It is a one off tax rise for those who would not notice it and would shut those up who want to tax the rich more.

C Powell

August 5th, 2008 10:49am

The problem which needs addressing is the fact that those who are on benefit or the working poor are worse off if they remain married. So what is good for them and their children is bad for their finances. We should remedy that i.e. there should be no financial advantage to splitting up. The fact that there is now is as a result of a deliberate Labour policy to undermine family structures. But we are not atomised individuals when we have children and it is wrong for the State to take no account of the fact that marriage is the best structure for strengthening society and bringing up children. If Cameron's words about repairing our broken society are to mean anything, then he has to do something to remove the bias against marriage and stable families which currently exists in the tax and benefit system. He - and Osborne - could learn a lot from our Continental neighbours in this regard.

mart

August 5th, 2008 11:06am

It's all so simple if one uses straw man arguments.

The example given is a "childless millionaire hedge fund manager who happens to be married to a lady who likes to lunch."

Right. So a straw man argument decides national tax policy. This unscrupulous type of argument is - I hope - not the basis of policy-making in the Tory party. I hope it's just a journalistic flourish on the part of Ms Sylvester.

Mr Osborne should think himself into the shoes of people much less well-off than himself. He should consider the hard graft and commitment that is at the core of successful marriages. He should consider that successful marriages tend to produce stable successful children. He should go and have a chat with Ian Duncan Smith who will provide some research evidence to prove these points. That's assuming that, with even a moment's thought, they are not already obvious to him, as they are to most of us ordinary plebs.

The Tories would be very popular (with me, anyway) if they allowed the husband and wife to join their income tax allowance, so that the family is not penalised financially for a decision for one parent to stay at home and care for children.

cuffleyburgers

August 5th, 2008 11:17am

A married couple's tax allowance is a good thing on balance as it does encourage a essentially benign behaviour.

However the overarching need is to simplify the tax code immensely, and that rather than sterile argument about gays and lesbians, is what is required between now and the election.

Gordon Brown's epic incompetence has brought one expensively bought commodity, which is widespread disaffection with the current shocking high rates of tax, stealth tax petrol tax stupidity tax and poverty tax, that for once there is a real window of opportunity for floating radical proposals to reform (ie. simplify) the system. He has proved beyond reasonable doubt that high taxes do not buy decent public services.

Let's not waste this opportunity(it's cost us over a trillion pounds...)

Victoria Street

August 5th, 2008 11:33am

Peter, you say: "But, as the split over marriage demonstrates, few cases are clear-cut. Meaning there's plenty of scope for disagreement."
Surely, this also means there is plenty of scope for compromise.
George and David have shown great maturity in managing their political policy differences over the past two and a half years.
That this nuanced issue should be the cause of splits is nothing more than wishful thinking on behalf of a media class disappointed that not all political 'couples' are on the fast track to the divorce courts.
I do, however, like your new classification of modern Tories - 'Pushers' or 'Nudgers'.
Personally, I'm more of a pusher, nudge, nudge!

Pete Hoskin

August 5th, 2008 11:55am

Richard Nabavi and Victoria Street: I'm referring to a "split" on this issue rather than a complete-and-utter split between Osborne and Cameron. The first kind of split needn't - and, I agree, won't - lead onto the second kind of split, but it's kinda interesting nonetheless. My apologies if the original post isn't clear on that.

Victoria Street: if only the 'Pushers' and 'Nudgers' classification would catch on!

Marcus Cotswell

August 5th, 2008 11:57am

People should be taxed as individuals, end of.

Tiberius

August 5th, 2008 12:10pm

I agree with mart.

Rachel Sylvester rarely makes an argument that sits easily, and this is no exception. And I am on Cameron's side of the argument - society is better ordered with a minimum of "alternative life-styles", so for the tax and benefits system to encourage them is somewhat silly.

Victoria Street

August 5th, 2008 12:18pm

Peter, you apologise for a lack of clarity, but surely phrases like "that tension is unlikely, by itself, to put an end to their relationship" and words like 'pandemic' are designed to nudge, if not push, us towards the idea that a relationship breakdown is a possibility in the future.

mart

August 5th, 2008 12:22pm

Marcus:

"People should be taxed as individuals, end of."

Can you give some reasoning for this statement, Marcus?

CS

August 5th, 2008 12:27pm

Is the only reason that this "split" is being treated as a big story that "divorce" sounds clever when used in conjunction with a discussion of marriage?

mart

August 5th, 2008 12:28pm

Pete:

"if only the 'Pushers' and 'Nudgers' classification would catch on!"

Let's hope it doesn't. It makes one cringe even more than the Labour use of the word "investment" as a euphemism for "spending".

Ray

August 5th, 2008 12:44pm

The argument is less about "the state telling people what to do" and rather about fiscal policy being so constructed that it offers incentives for people to behave in ways that strengthens familial bonds.

Ruairidh is right. At present, this Government seems hell-bent on rewarding behaviour that fuels social breakdown.

Pete Hoskin

August 5th, 2008 12:48pm

Victoria Street: No interntional nudging or pushing, I assure you! 'Pandemic' doesn't refer specfically to Osborne and Cameron. Whilst I only say "that tension is unlikely..." because, if you'll forgive the cliché, nothing's certain in politics. Even though I think that a fullscale Cameron-Osborne split is far from being on the cards...

HJ

August 5th, 2008 12:53pm

Fundamentally, I agree with George Osborne. I well remember as a young engineer that two of my colleagues who were married to each other , received a tax allowance that helped them to live a party lifestyle while I was struggling to pay my mortgage (they eventually divorced, of course, and didn't have children). The problem now, however, is that there are currently a number of ways in which married couples are discriminated against in the current tax and benefits system.

The Tories should take a tax-neutral approach and allow the natural financial and other benefits of marriage to re-emerge.

Unemployment and other benefits should not be denied just because you have a working spouse. Tax allowances should be transferable between married couples, so that they can choose whether they consider it more advantageous for one of them to stay at home (usually with children, but that's up to them) whilst still getting exactly the same tax allowance between them.

Surely such an approach would reconcile Cameron and Osborne?

Puncheon

August 5th, 2008 1:10pm

I understand why historically the law and tax systems have made no distinction between married couples and married couples with children. But today in this era of personal choices that approach no longer holds good. I think there should be a different set of criteria applied to couples, married or otherwise, once they have children, mainly because the latter are third parties that any civilised society must protect. For example, divorce should be made much more difficult once children are born to prevent one or other party walking away from their responsibilities or foisting the cost onto the tax payer. Similarly a diffrent tax regime should apply, so that professional couples without children can be taxed seperately if they wish, but those with children should be subject to a tax regime that encourages them to stay together. If couples with children wish to have some protection and subsidy from the rest of society they must accept a degree of external control.

The Happy Carbon Footprint

August 5th, 2008 1:15pm

While it's not the business of the state to tell people how to live their lives, it is the business of the state to encourage social stability. We have experienced, over the last 11 years, the effects of a government rewarding instability and irresponsibility.

Tax breaks for married families don't make marriage mandatory. People can still choose not to get married and to raise their children in social squalor.

I don't like George Osborne. These people appear to have no connection to real life, and they don't seem to read the papers, other than doing word checks to see if their name is mentioned.

Verity

August 5th, 2008 1:26pm

Ray - "At present, this Government seems hell-bent on rewarding behaviour that fuels social breakdown."

"seems"? SEEMS? The socialists have spent 11 years intensively deconstructing a society it took our ancestors hundreds of years to build.

Now George Osborne is buying into the programme. Other than William Hague - now that David Davis is gone from the Shadow Cabinet - the Tories have no steely conservative beliefs to strengthen their backbone. They are LabourLite Lite. They are also cowards and hungry for power at any price. They make me sick.

Tiberius

August 5th, 2008 2:58pm

Verity; you really do sound as if you are scweaming!

My ears truly popped when I read your upper case - IN ITALICS!

David Lindsay

August 5th, 2008 3:11pm

Well, he's againt fatherhood despite being the heir to a baronetcy, so it's no surprise that he's against marriage as well.

Or, in general, that he is thick.

Of course, we knew that anyway. He's only there because he's a member of the Bullingdon Club, which is why Cameron not only will not, but actually cannot, sack him.

Oscar

August 5th, 2008 3:18pm

Why has this emerged as a 'story' now? It's a difference of opinion that's been well documented for a long time. But talk of such 'splits' get talked up in therun up to conference season. I well remember efforts to make out there was a serious Cameron/Osborne 'split' just before last year's conference - remember the supposed 'uber-moderniser' spat, which melted like the morning dew? The debate about supporting marriage in the tax system is an important and complex one and it's a healthy sign that Cameron and Osborne can openly debate it. I nudge towards Cameron on this one by the way.

Verity

August 5th, 2008 3:20pm

Tiberius - Take two aspirins and lie down.

(I don't know what "scweaming" means, unless it was a typo.)

Verity

August 5th, 2008 3:23pm

David Lindsay, why cannot Cameron sack him? If you have some skinny, please share it!

Tiberius

August 5th, 2008 3:44pm

Verity; surely you didn't miss Bonny Langford in Just William?

Do you want a couple of my aspirins?

Ray

August 5th, 2008 3:46pm

Verity - you are right and I apologise. I was being far too generous about the motives of McBean and his crew.

TomTom

August 5th, 2008 3:47pm

"than to reward a childless millionaire hedge fund manager who happens to be married to a lady who likes to lunch."

Osborne should change his circle of friends...he is way out of touch with everyday reality.

If he has a problem with hedge-fund managers he should tax them with a Minimum Tax Obligation. It seems absurd to base family policy for a nation on the basis of the peculiarities of a rich man's absurd and moneyed friends....no doubt he would deny them NHS care and pensions and police cover too !

David Lindsay

August 5th, 2008 3:55pm

Cameron can't sack a Bullingdon Brother, Verity. Even if he were prepared to do so in principle (and I'm sure he isn't), yet another Tory coup would result within hours, possibly minutes.

Verity

August 5th, 2008 4:44pm

Well, David Lindsay, I imagined it was something to do with the Bullingdon Club, of course - but why can't he sack a Bullingdon brother? Bad form? Or something darker?

Tiberius writes: "Verity; surely you didn't miss Bonny Langford in Just William?" I must have done. I have no idea what you're talking about.

I do know that you would not have written "scweaming" in response to a male who posted one word in italicised capitals. I don't like your dismissive attitude.

David Lindsay

August 5th, 2008 5:34pm

"but why can't he sack a Bullingdon brother? Bad form? Or something darker?"

What could be darker than bad form, Verity?

It is obvious that this simpleton is only in the job because he is a Bullingdon Club member, which he nearly never became because he is the son of a mere baronet.

Those who would pretend that Cameron, or at least his family, are really just middle-class on the make should consider that, by contrast, Cameron sailed into the Bullingdon Club.

Tiberius

August 6th, 2008 1:49pm

Verity: I, for better or worse, have a "vive la difference" view of men and women; not a dismissive view.

If a man had typed your phrase, I don't think the image of Bonny Langford in Just William would have popped into my mind.

But I do apologize if I have offended you.

Nigel Sedgwick

August 6th, 2008 4:44pm

I'm with HJ (comment August 5th, 2008 12:53pm) and question things thus.

Consider two otherwise identical families (eg same number and ages of children). In one, husband and wife earn approximately equal amounts; in the other one of them earns all the family income (the same amount in total).

Why should these two families not pay, in total, the same amount in Income Tax and National Insurance Contributions?

Best regards

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