The families we choose to forget

John Major has little time for low-income mums and dads, says Yvette Cooper

Families are lovely. Politicians love them anyway, and gush over them with soppy warm sentiment whenever they get the chance. John Major had a go again this week, but political representatives from all parties are prone to the same behaviour.

Curiously - given that some at least of these family-friendly politicos are supposed to be running the country - everyone also seems to agree that the nasty old state doesn't do enough to help these kindred clusters. What with the taxes taken away and the benefits and support withheld, the consensus is clear: families in Britain are getting a raw deal. Something must be done.

But much of this paternal and maternal anguishing is nonsense. Some families - and many children - are indeed badly treated by the Government and by society. But families in general have little to complain about. Moreover, changing the tax system to help them in the way that some people - including John Major - have suggested would be unfair and would do nothing to help the families who need support most.

Most of us hate to think we are horribly greedy, and are inclined to resent a politician that makes us feel so. But tell us instead that this extra cash from the state is for us to spend on our families, and we feel smug about ourselves again. For who could blame us for wanting to do the best for our bright-eyed little bubbly ones, even if it is at the expense of some other individual somewhere else?

So what is it that these families supposedly need from their tax and benefit system that they are currently so unfairly denied?

Mr Major's answer is laughable. It seems that for the Prime Minister, the most pressing problem families face is not poverty, child care or marriage break-up, but the frustration of being unable to pass assets from one generation to another. Because rich old people can't give luxurious nest-eggs to their (usually well off) middle-aged son or daughter, the family is being undermined. Ridiculous.

Others offer more superficially plausible policies to improve the family lot - but again, they do little to help those who really need it. Church leaders suggest that marriage itself, rather than children, should get a bigger subsidy. The married couple's allowance could be increased, not whittled away.

What a waste of money. The financial incentives to share family life are already considerable. It is cheaper to stay together, as any divorcee will readily testify, and why should we transfer any more money from lonely singles to happy lovers?

Some go further still, arguing that the present tax system discriminates against families where one parent (of whatever sex) chooses to stay at home to look after children. After all, the husband on pounds 40,000 a year with a wife and children at home will pay more in tax than the couple earning pounds 20,000 each, although their gross household income is the same.

Whether the idea is to subsidise the married, or to subsidise the home- maker, the underlying principle that justifies these ideas is the same: tax the family unit, not the individual. That, after all, is the way we calculate benefits for those who don't work - by household, not per person. So we pay benefits for the woman whose husband is out of work, but not to the non-working wife of a rich barrister.

But appealing as this principle may seem to our cohesion-hungry country, the consequences would be counter- productive. Independent taxation for men and women was achieved after centuries in which the tax system treated married women as in effect the property of their husbands. The IMF economist Janet Stotsky points out in a recent working paper that the Inland Revenue, even as recently as the mid-Seventies, refused to answer letters from married women. If the Missus was overdue a tax refund because she had paid too much one year, the cheque was sent to her husband. Not until 1990 did the "married man's" tax allowance become a transferable allowance for either spouse, and did fair, independent taxation of men and women really begin.

But the biggest objection to a house-spouse subsidy is not history, but waste, once more. Giving tax breaks to rich families where one parent works will do nothing to help the families who are really in trouble - the ones where no one works at all.

The real fiscal fiascos for families take place at the bottom end of income distribution. For a start, an appalling one-in-three children are being brought up in poverty. Single parents bringing up the kids alone struggle to find affordable child care to let them go out to work. The Government's nursery vouchers aren't much use to families like these, serving instead to subsidise the families who are doing very nicely already thank you.

And what about the couples who are trapped in unemployment. As work by Paul Gregg and Jonathan Wadsworth reveals, households in Britain have polarised over the past 20 years into those with two earners and those with none. The traditional nuclear family where dad goes out to work and mum stays at home with the kids barely exists any more.

The real problem is the no-earner families. As new research (from the Gregg stable again) released on Friday demonstrates, many of these families are trapped into cycles of unemployment and low-paid work. And when one partner loses a job, the other has little incentive to get work either given the savage withdrawal rate of benefits for the low paid. These are the families who are really getting a bad deal. The effective marginal tax rate (the rate at which taxes are imposed and benefits withdrawn) for low-paid single people isn't too bad, but for couples with children it is abysmal, rising up to 100 per cent at certain rates of pay. In other words, every extra pound a parent earns is gobbled up entirely by the state.

These are the families who really need help. These are the families who the state is currently doing a lot to undermine. If only the Prime Minister could spare just a little attention for them, next time he feels the need to caress families in public again.

Sport
The sun rises over St Andrews golf course, but will it be a new dawn for the Royal and Ancient Golf Club?
sportAnd it's Yes to women (at the R&A)
Arts and Entertainment
Friends is celebrating its 20th anniversary this year
tvSeries celebrates 20th anniversary
Sport
Yaya Touré (left) and Bayern Munich’s Spanish defender Juan Bernat
footballToure's lack of defensive work is big problem for City
Voices
voicesApple continually kill off smaller app developers, and that's no good for anyone
PROMOTED VIDEO
Arts and Entertainment
Liam Neeson said he wouldn't
tv

Liam Neeson's Downton dreams

Sport
Wembley Stadium
footballNews follows deal with Germany
Arts and Entertainment
A spell in the sun: Emma Stone and Colin Firth star in ‘Magic in the Moonlight’
filmReview: Magic In The Moonlight
News
ebooksAn unforgettable anthology of contemporary reportage
Sport
A 'Sir Alex Feguson' tattoo
football

Arts and Entertainment
Ben Whishaw is replacing Colin Firth as the voice of Paddington Bear
tv

Thriller is set in the secret world of British espionage

Life and Style
life

News
ScienceGallery: Otherwise known as 'the best damn photos of space you'll see till 2015'
Life and Style
fashion

Bomber jacket worn by Mary Berry sells out within an hour

Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

SQL Developer - Watford/NW London - £320 - £330 p/d - 6 months

£320 - £330 per day: Ashdown Group: The Ashdown Group have been engaged by a l...

Head of Audit

To £75,000 + Pension + Benefits + Bonus: Saxton Leigh: My client is looking f...

Audit Manager Central Functions

To £85,000 + banking benefits: Saxton Leigh: You will be expected to carry out...

Credit Risk Audit Manager

Up to £90,000 + benefits: Saxton Leigh: Credit Risk Audit Manager required to ...

Day In a Page

Mystery of the Ground Zero wedding photo

A shot in the dark

Mystery of the wedding photo from Ground Zero
His life, the universe and everything

His life, the universe and everything

New biography sheds light on comic genius of Douglas Adams
Save us from small screen superheroes

Save us from small screen superheroes

Shows like Agents of S.H.I.E.L.D are little more than marketing tools
Reach for the skies

Reach for the skies

From pools to football pitches, rooftop living is looking up
These are the 12 best hotel spas in the UK

12 best hotel spas in the UK

Some hotels go all out on facilities; others stand out for the sheer quality of treatments
These Iranian-controlled Shia militias used to specialise in killing American soldiers. Now they are fighting Isis, backed up by US airstrikes

Widespread fear of Isis is producing strange bedfellows

Iranian-controlled Shia militias that used to kill American soldiers are now fighting Isis, helped by US airstrikes
Topshop goes part Athena poster, part last spring Prada

Topshop goes part Athena poster, part last spring Prada

Shoppers don't come to Topshop for the unique
How to make a Lego masterpiece

How to make a Lego masterpiece

Toy breaks out of the nursery and heads for the gallery
Meet the ‘Endies’ – city dwellers who are too poor to have fun

Meet the ‘Endies’ – city dwellers who are too poor to have fun

Urbanites are cursed with an acronym pointing to Employed but No Disposable Income or Savings
Paisley’s decision to make peace with IRA enemies might remind the Arabs of Sadat

Ian Paisley’s decision to make peace with his IRA enemies

His Save Ulster from Sodomy campaign would surely have been supported by many a Sunni imam
'She was a singer, a superstar, an addict, but to me, her mother, she is simply Amy'

'She was a singer, a superstar, an addict, but to me, her mother, she is simply Amy'

Exclusive extract from Janis Winehouse's poignant new memoir
Is this the role to win Cumberbatch an Oscar?

Is this the role to win Cumberbatch an Oscar?

The Imitation Game, film review
England and Roy Hodgson take a joint step towards redemption in Basel

England and Hodgson take a joint step towards redemption

Welbeck double puts England on the road to Euro 2016
Relatives fight over Vivian Maier’s rare photos

Relatives fight over Vivian Maier’s rare photos

Pictures removed from public view as courts decide ownership
‘Fashion has to be fun. It’s a big business, not a cure for cancer’

‘Fashion has to be fun. It’s a big business, not a cure for cancer’

Donatella Versace at New York Fashion Week