Peter Hoskin

Why I remain unconvinced about the Tories’ tax break for married couples

Why I remain unconvinced about the Tories' tax break for married couples
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Ok, Fraser - I'm not going to let this tax 'n' marriage debate rumble on interminably, but I do want the final word!  First, I appreciate your response - it makes a very strong case, but one which fails to convince me.  Why?  Well, largely because I agreed with most of it already.  As I said in my original post, IDS and others have unearthed plenty of statistics which show just how important marriage is to the functioning of society, and to the lives of people within it.  This evidence, much of which you raise, is important and shouldn't be ignored.  

But there are still reasons - beyond those set out by Philip Collins today - for being wary of, specifically, tax-breaks for married couples.  For starters, what's to be gained from them?  Yes, there is an imbalance in the welfare system which sees some people (lone parents) receive income whilst unmarried which they wouldn't receive if they were married. This, of course, is what people mean when they say that the current set-up "penalises" against marriage, and it encourages some people to remain unmarried or - as in the sad case you highlight - to consider divorce for purely financial reasons.  But how many people out there are remaining unmarried (or getting divorced) for those reasons?  I must stress, I'm not asking this question sneeringly - I understand the immense money worries that many families struggle with - but it's a question that I've never seen a convincing answer for.  Are we talking 100s, 1000s, 10,000s, 100,000s?

Right, let's develop that question: how many of those people would then consider marriage (or stop considering divorce) for the sake of a £20-a-week tax break, who wouldn't have considered it before?  Again, is it 100s, 1000s, 10,000s etc.?  I rather fear that we're talking sub-sets of sub-sets here: a tax break, as admirable or as fair as it may be, just may not have that much of a social effect.  It just may not be a determining factor for a lot of people.

But what about the principle of it?  Doesn't justice dictate against this tax imbalance?  Shouldn't we remove these perverse disincentives from the least well-off?  Well, yes.  But surely there are better ways to do it than the Tories propose.  A £20-a-week tax break for married couples is rather like carpet bombing when a smart bomb would be more suitable.  Some estimates say that it would cost the Exchequer around £3.2 billion.  Much of this would be waste; benfitting people who either don't really need it or who would have got married anyway.  And can we or a Tory government tolerate this waste with Brown's debt mountain looming large in the background?  My fear is that it's yet another commitment, of dubious benefit, which could just raise the burden on future generations. 

Of course, you could counter that there will be long-term fiscal benefits because of the stabilising social effects that marriage brings with it  - a point you made, Fraser, in your post.  But, again, can you quantify that?  In light of my questions above, is there any reason to believe that the fiscal benefits will be particularly large?

This doesn't mean that the Tories can't do things to support marriage - I rather like IDS's idea of funding marriage counselling, for example.  And it doesn't even mean that they shouldn't consider tax breaks in future.  But I remain convinced that now is not the time for that, and that their current proposal is so indeterminate that it deserves to be called "bad policy".