Bishop: reform tax system instead of reforming marriage

THE GOVERNMENT should spend more time reforming the tax system to make it fairer to families instead of going ahead with gay marriage proposals with “undue haste”, the Bishop of Exeter has said.

Bishop Michael Langrish launched a scathing attack on the child benefit changes, which he said will penalise oneearner families, and also hit out at the Government’s failure to bring in a married couples’ tax break.

In a House of Lords debate, he said that families where one parent had chosen to stay at home to bring up a family should be “valued and supported rather than penalised” as it was beneficial to the development of their children.

He said that figures showed 61 per cent of one-earnercouple families either had a child below the age of five, someone who was disabled or someone with caring responsibilities so the stay-at-home parent was not in paid employment out of necessity.

From this month, people paying higher rate tax lose their child benefit, but Bishop Langrish said: “Under the change, a one-earner couple begins to lose its child benefit at £50,000 and loses it completely at £60,000, while the two-earner family next door has the potential to earn up to £100,000, so long as neither income rises above £50,000, and keeps all its child benefit up to nearly £120,000, so long as neither income reaches £60,000, before losing it completely. This is not a small unfairness. It is very significant.”

He said Prime Minister David Cameron had argued the top 15 per cent of earners should make a greater financial contribution during difficult times.

But he said the social policy charity CARE had released figures that showed a one-earner couple with four children on £50,000 was in the least well-off half of the population, with a higher net income than only 45 per cent of the population.

“The removal of child benefit will push it even further down the income distribution,” Bishop Langrish said.

“A one-earner couple with three children on £60,000 and in receipt of child benefit is just in the seventh decile, but will drop well into the sixth decile if child benefit is removed.

“Meanwhile, a two-earner couple with two children on the same wage will be well up in the eighth decile and keep its child benefit.”

He said families with one earner on £60,000 already paid a substantially higher amount of tax than those with two incomes of £30,000.

And he added: “There is an extraordinary irony in all this. Prior to the general election, the then Leader of the Opposition [Mr Cameron] talked at great length about his commitment to helping one-earner married couples by giving them a transferable allowance.”

He said the Government had found billions of pounds to increase the personal allowance which “disproportionately benefits those in the top half of the income distribution”, while the transferable allowance would be “far more progressive” as it would benefit lower earners.

And he told peers: “Of course, to the extent that the introduction of transferable allowance was made as a commitment to recognise marriage, albeit only in a one-earner context, the Government’s failure to act has been rendered even more perplexing by the fact that this marriage commitment in the Prime Minister’s manifesto has received no attention, while proposals to redefine marriage that were not in any party’s manifesto are proceeding with undue haste.”

Bishop Langrish said time was running out to introduce transferable allowances and argued that the next Budget, in March, was the last opportunity to do it before the election and urged Chancellor George Osborne to make it a priority.