There are times when you think, really, the Prime Minister should get out less. The good ideas he comes back with when he goes abroad are fine and dandy — of which, more later — but the bad ones are very bad indeed. One notion he is considering just now after attending a Nordic-Baltic summit is the Swedish/Finnish one of giving people who employ domestic help tax relief on half of the cost. On the plus side, you get more women in the workplace, by allowing them to subcontract the domestic drudgery, and you shift thousands of workers, mostly female, from the black economy to the respectable economy.
For the downside, I hardly know where to start. Look, of all the problem David Cameron has got, the most acute is that he looks, sounds and seems like a toff who gets to know about ordinary people’s lives from his cleaners and his drivers and his friends’ cleaners and drivers (actually, I knew one newspaper editor like that). So let me spell it out: giving a tax break to people like his wife is not the way to seem less out of touch. It makes him look like a man looking after his own. It’s not going to come across as a measure to help the domestics; it’s going to sound and feel like something to help the middle-class women who employ them. It would be a Valentine’s gift for Labour — notwithstanding the fact that every single left-leaning female pundit who opines on it will herself be employing a cleaner, probably of Polish origin, and may indeed mention as much in the course of her diatribe.
Indeed in Sweden, by all accounts — and I yield to the editor of the Spectator on this one — the measure has its critics. They say it benefits the high earners more than the lower paid on the employers’ side and it benefits migrant workers more than locals when it comes to the employees. And the same would be true in spades here — if you know an English cleaning lady, you probably don’t live in London
That out-of-touchness is, I’d say, at the root of an awful lot of Tory problems. It’s how they ended up taking child benefit away from higher rate taxpayers. I can only fancy that the Chancellor had his ear bent by umpteen trust-fund wives, who told him how ridiculous it was that they were being paid child benefit. I know I’ve heard that one from the wealthy again and again. Trouble is, by listening to the upper ten thousand, you lose track of the fact that it’s actually rather a good benefit for many more people who are only just in the higher tax band but whose pips are being well and truly squeezed by rising inflation, the inexorable fact that children get dearer as they get older, and, quite possibly high levels of personal debt — all right, that last one may be just me. Being a universal benefit meant that it didn’t bring in its wake an army of means testers; it was yours of right.
And that’s the other thing that’s wrong with this attempt to use the tax system to get women back to work. The tax system should, I’d say, discriminate in favour of marriage but it should not be used to favour those who work outside the home as against those who work in it, bringing up children and cleaning up after them. A universal benefit doesn’t do that; it’s yours whether you farm your children out or mind them yourself. And giving tax breaks for domestics goes against another erstwhile Tory ambition, which is to simplify the tax system, not render it more complicated.
Which brings me back to one of the Swedish ideas the Prime Minister should have brought back home with him: that of his fellow Conservative (or, rather, ‘Moderate’), the Swedish premier Frederik Reinfeldt, who transformed his country’s economic prospects by cutting taxes for the working poor. Cutting taxes, and letting people spend their money how they want — rather than nudging them in the direction of employing domestics — is, I’d say, a profoundly conservative way to go.
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