Election promises continue the attack on families with one income

One-earner families enter the top tax bracket at €41,800 while two-income families do so at €65,600, writes Victoria White
Election promises continue the attack on families with one income

ARCHBISHOP Diarmuid Martin called this week for intervention by the mothers and grandmothers of the gangland criminals. He said they were “strong women” and “persons of wisdom”. Who knows if his plea will go anywhere. But at least he recognises the central role a parent can play, not just in a family, but in a society.

Pity our aim is to put them out of business. This government has continued the work of governments since Charlie McCreevy’s tax individualisation budget in 1999 so that a married couple with two earners can currently bring home over €5,000 more than a married couple with one earner on the same wage.

It seems nobody has any problem with this gross inequality. So much so that Enda Kenny confirmed on RTÉ radio this week that Fine Gael’s proposed 5% “claw back” of some of the benefit of USC abolition from workers on over €100, 000 will be paid on individual incomes, not household incomes, and drew no comment.

Two earners on €99,000 each and there’s no “claw back”, it seems; one income of €100,000 and you lose 5%. This blunt instrument takes no account of the number of a family’s children, the state of those children’s health and the size of their mortgage which would make some families far from “super-rich” on €100,000 compared with a married couple with no children and no mortgage on €198,000.

Fine Gael is not alone in its devotion to tax individualisation with no compensating measure to recognise family circumstances. It is just the most galling because Fine Gael led the criticism of Charlie McCreevy’s budget in 1999. It was Michael Noonan who stood up in the Dáil and accused McCreevy of “changing the kind of Ireland we have known and changing it for the worse”. Now, although he’s minister for finance he says he can do nothing about it. He can’t repeal individualisation because “society has changed”, he told RTÉ last year. He agreed that our taxation policy “treated people unequally as families” but added that it “treated them fairly as individuals”. What kind of country would promote individuals over families? What kind of country would divorce children’s married parents in its tax code?

Mr Noonan proposes increasing the home carers’ tax credit from €1,000 to €1,650 and increasing the income threshold above which it is not paid to €10,500. That still leaves a massive gap between families with two earners and families with one earner, a gap which will nearly double for high earners after the “claw back”, although some families with two earners don’t use childcare because they have older children or flexible work.

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This is an ideological attack on stay-at-home parents. You’d have to ask what they have done to deserve it. They mostly raise their kids well and serve their communities diligently. They are no better than parents who work outside the home but they are no worse either. They are the same people in different circumstances.

It is appalling that one-earner families enter the top tax bracket at €41,800 while two-income families do so at €65,600. If a father got offered some night security work to bulk out the family’s income they could streak into the top tax bracket but his partner could take on work in the local supermarket with no penalty. Whose business is it except theirs who goes out to work and who stays home? Lucky the family that has any choice.

The Central Statistics Office is not yet able to offer me today’s breakdown of mothers of children under-15 working full-time, part-time, and at home but my statistics for 2012 showed more than 30% of mothers working full-time, while approximately 20% worked part-time and approximately 50% worked in the home. There are 250,000 mothers working full-time in the home. And while many of those women are finished with the full-time rearing of their children, actuary Brendan Lynch makes the point to me that many women in their 50s and 60s who have devoted two decades to child-rearing won’t make an easy return to the workforce and may still be the emotional mainstay of their families and their communities.

“Strong women”, so. “Persons of wisdom.” But because we have used the tax system to socially engineer the end of the one-income family, we have left young families next to no choice, despite consistent findings like that of Amárach Research in 2013 that full-time daycare was the preferred choice of just 17% of parents. I was mortified recently when a friend who is expecting her first baby detailed her search for a rental home in Dublin decent enough to bring a child into. She’s paying nearly €2,000 a month. No childcare is going to be cheap enough for her. Meanwhile her landlord winters in Spain guzzling the money which should be going straight to her child.

Tax individualisation from 1999 was one of the factors which fuelled our crazy property boom. It transferred money from children to banks and developers. Maybe you think that’s a terribly intelligent way to run a society. I have to say I don’t.

It is an attack on children which began with the abolition of the child tax allowances in the 1980s and progressed to individualisation in 1999. There have been movements of outraged citizens including Nora Bennis, Nora Gilligan, and her daughter-in-law, Áine Uí Ghiollagáin who is secretary general of the parents and carers’ NGO Cúram. She vividly remembers sitting in her car listening to Charlie McCreevy saying he didn’t want to incentivise women to sit around drinking coffee.

They have had very little impact. And that is not surprising because this is an issue on which the traditional right and the traditional left agree. Of course Joan Burton spoke out against tax individualisation when she was in opposition, saying in 2007 that “the policy of individualisation has led to dramatic transfers from families with children to two-income households, many without dependents… Small wonder that many single income families really feel that the State has it in for them.”

Small wonder, Joan. Since getting into Government the same woman has presided over the cutting of pensions for women who have spent most of their lives working in the home on the basis that “Those who pay more benefit more”. She has kicked single parents with no children under seven off the one-parent family payment.

Our tax system does give a tax allowance to children of single parents but none for children of married parents. Do children of married parents come into the world with shoes on their feet? Do they not have mouths to feed?

In France and Germany, countries with much better records on child poverty than we do, children have a tax allowance of their own. Isn’t it clear that the only fair way to tax families with children is as households rather than divorcing their parents and pretending they have no children?

Am I just talking to myself here? Or is anyone prepared to stand up in Government and speak for families with children?

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