Amiel and Melburn Trust Residential Weekend

Slide from Amiel and Melburn Turst Residential Weekend

I was delighted to be invited to present at the Amiel and Melburn Trust weekend where campaigners, activists and thinkers were brought together to exam contemporary capitalism and the economic crisis.

The Trust was founded in 1980 by Norman Melburn and named for his friend and fellow Marxist, the lawyer Barry Amiel. The general objectives of the Trust are to advance public education, learning and knowledge in all aspects of (a) the philosophy of Marxism (b) the history of socialism, and (c) the working class movement.

I talked about capitalism and gender inequality and had a great response to my talk. Gender often gets left out conversations of the economy I was glad to be there and hope to work with the Amiel and Melburn Trust again soon.

The transferable tax allowance for married couples: another blow for women?

My article on behalf of the Women’s Budget Group for Society Central. First published here. Photo – hands with wedding rings by Greg Kendall-Ball shared under a creative commons license.

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On announcing the Transferable Tax Allowance, David Cameron said: I believe in marriage, I believe marriage should be recognised in the tax system. I see this as….a start of something I would like to extend further.” 

wedding ringsThe TTA (or Marriage Tax Allowance) is a scheme that allows the high-earning partner of married couples (or those in a civil partnership) to use some of their low/non-earning partners’ tax-free allowance.

The move promises to reward couples that have taken a vow of commitment to each other but on closer inspection the policy is deeply flawed. Leaving aside the morality of using fiscal policy to shape interpersonal relationships and the radical departure this represents from the Conservative policy of independent taxation, the benefits of this scheme are frankly, unequal.

New analysis from the Women’s Budget Group using data provided by the Institute of Fiscal Studies shows that, far from helping families, the beneficiaries of the TTA are actually 85% male. Women are more likely to be the low-earning partner in couples for reasons including (but not limited to) the fact they tend to work part-time or not at all to care for children or relatives. It is mostly men who are the high-earning partner in couples and, therefore, men who will benefit from this tax break.

Proponents have argued that a tax break for one partner is saving for all the family. But the idea that an individual’s income is split equally with their partner is questionable.

Financial power dynamics between couples are complex and often unequal. There is little evidence to suggest that men split their income equally with their spouses. In fact available evidence suggests that men are more likely than women to use their income for personal spending. This gendered tax relief is therefore unlikely to benefit the rest of the household.

It is important not to overstate the impact of this policy, as the rewards are relatively meagre. High earners will be able to transfer £1000 of their annual personal allowance of tax-free income between themselves, as long as neither pays income tax at more than the basic rate. This will mean the high earner in eligible couples will pay up to £200 less tax a year or around £4 a week.

Given Cameron’s commitment to extending the tax allowance in the future, this announcement is only the thin end of the wedge. Yet increasing this type of tax allowance will only create further economic disparity between men and women and put increasing pressure on low earners, namely women, to remain unemployed or in part-time work.

The limitations also mean that very few married couples will actually benefit. If both partners earn over the income tax threshold it won’t apply. The poorest families (where both partners don’t earn enough to pay tax) also won’t benefit, even though they are most in need of support.

Moreover, only 18 per cent of families with children will be eligible, calling into question the Conservative pledge to do “everything [they] can to support families during tough times”. This is because of the eligibility criteria outlined above, but also because many couples with children are not married including the 2 million single parents in Britain today.

Finally as couples will need to apply to receive the their tax allowance, this automatically reduces uptake for the sizeable proportion of those who don’t know or don’t know how, to claim.

Stranger still, this policy represents a radical departure from Conservative party ideology.

Prior to the 1980s, a married woman’s income was treated as her husband’s. Following a consultation on the matter, the Conservatives (along with all the other major parties) rejected a transferable tax allowance, opting for independent taxation instead. The move made sense.

Marriage has no financial need in and of itself and independent taxation is better for women’s economic autonomy. So why this sudden shift? Few couples will actually benefit from the TTA and those who do, will receive only a token amount.

The £700 million that it will cost to fund the TTA could be used instead to tackle some more urgent social needs. For example, this figure could be used to make up for two of the four years for which child benefit has been frozen or raised by less than inflation.

Alternatively, the money could be used to reinstate child benefit as a universal benefit for all children. The higher income charge was projected to take £690 million from parents in 2013/14, almost exactly the same amount as would be paid out to married couples through TTAs from 2015/16.

Rather than further reducing the incentive for women to return to work, the money could also be spent on improving childcare, the cost and availability of which remains one of the biggest hurdles for women returning to the workforce after childbirth.

Only £200 million – about one third of the amount being spent on TTAs – would be needed to extend the proposed additional childcare help in Universal Credit to all, rather than restricting it to those earning above the tax threshold, as currently proposed.

Sue Himmelweit of the Women’s Budget Group said that it was:

both morally suspect and almost certainly counterproductive to bribe people into marriage.”

And given how few married couples will actually benefit from the programme, this can only be seen as Cameron’s attempt to appeal the social conservatives of his party.

Yet the announcement of the Transferable Tax Allowance in the Autumn Financial Statement passed with little remark from either public or press. Perhaps it was seen as small fry compared to the other headline-grabbing commitments of continued austerity or perhaps the public doesn’t see it as a threat.

Either way, if this really is the thin end of the wedge, we should be concerned. The government would be better off helping the most vulnerable in our society rather than using tax to reward one type of living arrangement over another.

Women left behind in the Autumn Statement

women against the cutsThis blog first appeared on the TUC’s Touchstone Blog and is written on behalf of the Women’s Budget Group.

This morning’s Autumn Statement felt rather too familiar. Not only because the headlines were leaked to the press in advance but also because, once again, women were left behind.

Osborne congratulated himself on the indicators of recovery, but at the Women’s Budget Group we asked, recovery for who?

Unemployment is falling, yet women’s unemployment has fallen by less than 4% since 2011, half as fast as men’s (9%). Real earnings are not recovering; instead they have continued to fall for both men (0.4 % for gross hourly earnings) and for women (0.7%). As the cost of living rises and progress on the gender pay gap stalls, inequality only becomes further entrenched.

Yet again the Chancellor’s announcement focused on investment in physical infrastructure and said nothing about care services for children, elderly and disabled people. Investment in social infrastructure is just as important for the long-term health of the country and the further £3 billion cuts in public spending will continue to hurt women the most.

The £700 million married couples tax allowance would be better spent elsewhere. Only 18% of families with children will benefit from this measure. This money will go to the higher earner (the vast majority of whom are men) which will worsen income inequality within married couples.

Taxation policy is no place for moralistic judgements and the tax allowance will not help Britain’s poorest families: couples where both partners earn below the basic tax rate or lone parents (92% of whom are women). What’s more it appears this announcement is only the thin end of the wedge as Osborne promises to extend this tax allowance in the future.

In September 2013 the Women’s Budget Group argued for Plan F – economic recovery for gender equality but this financial statement does nothing towards that.

George Osborne claims Britain’s economy is on the up, but with low wages, spiraling costs of living and a dramatic decrease in social security, whose boat is lifted by the rising tide?

Women are feeling the pinch more than most, and the Autumn Financial Statement does little to alleviate the pain.

Osborne’s recovery is an illusion, women still feel the pinch

Women’s Budget Group press release on the Autumn Financial Statementwomen & economic recovery cartoon

George Osborne claims Britain’s economy is on the up, but people are still struggling to cope with low wages, a rising cost of living, and a dramatic decrease in social security. Women are feeling the pinch more than most, and the Autumn Financial Statement does little to alleviate the pain.

Women’s unemployment has fallen by less than 4% since 2011, half as fast as men’s (9%). Real earnings are not recovering; instead they have continued to fall for both men (0.4 % for gross hourly earnings) and for women 0.7%. Progress on closing the gender pay gap has also stalled.

Yet again the Chancellor has focussed only on investment in physical infrastructure and said nothing about investing in care services for children, elderly, and disabled people. Making long-term plans investment in social infrastructure is just as important for the long-term health of the country. The cuts in spending continue with a further £3 billion over the next three years.

The £700m given away on the married couples tax allowance would be better spent on elsewhere. Only 18% of families with children will benefit from this measure. This money will go to the higher earner, the vast majority of whom are men, which will worsen income inequality within married couples.

Professor Diane Elson, chair of the Women’s Budget Group, said: “The chancellor talks of recovery but it to doesn’t feel like it to most people with real earnings still falling. The Autumn Financial Statement does nothing to ensure a recovery that supports gender equality”

The WBG’s Sue Himmelweit said: “Transferable Tax Allowances are a bad idea and we concerned to hear the Chancellor plans to build on them. Money given away on the married couples tax allowance would be better spent on real social priorities. One of these would be to extend help with unaffordable childcare costs to the lowest earners among families on Universal Credit, a measure that would cost just £200m.”

 

ENDS.

For further comment, please contact:

Sue Himmelweit : 07963951333

Jerome De Henua: 07860556254

The Women’s Budget Group is a network of over 200 academics and activists. For more information, please visit www.wbg.org.uk or contact Amy Watson (admin@wbg.org.uk) WBG Coordinator

NOTE: An in-depth analysis of the impact of the Transferable Tax Allowances will be published by Women’s Budget Group on Saturday 7th December 2013.

Chancellor’s spending review is bad news for women

This post was first published by the F-Word a contemporary UK feminist site which I was delighted to blog for.

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Though the Chancellor tried to make good headlines with his recent spending review announcement, it is clear that once again the budget has not been gender-proofed. Polly Trenow discusses the implications for women

On 26 June, George Osborne announced his spending review setting out the cuts and savings to be made between 2015 and 2016. With the general election due in 2015, there were few surprises in store: more cuts, more austerity and a couple of crowd-pleasers to keep the voting public on his side.

And like every good Treasury speech, Osborne ensured the bad news was sandwiched between his good news headlines: the NHS budget will be safe from cuts in that financial year and overseas development spending will remain at 0.7% of GDP. The Chancellor also told us that for every public sector job that has been lost, three private sector jobs have been created and announced a huge investment in physical infrastructure – roads, rail and nuclear power stations.

Osborne IF campaign.jpg

So not all bad then? Well not quite. Always the perfect politician, the Chancellor’s boasts of savings and spending hide a multitude of sins.

Despite decades of campaigning, the Treasury have continually failed to ‘gender-proof’ their budgets. The Equalities Impact Assessment for the spending review dedicated a whole seven sentences to the impact on women, all of which only highlight the benefits to women rather than exploring the possible negative consequences. Economic policies can have very different impacts on women and men, yet we rarely see any recognition of this during the budget-making process.

Local governments who have seen their budgets aggressively slashed in recent years face another year of austerity, with their spending reduced by a further 10%. Local authorities fund essential services for women and women’s organisations. Programmes like Sure Start Children’s Centres and the Supporting People programme which fund many sexual and domestic violence support services have already faced cuts of around 11% and now their future looks as uncertain as that of the women and children they support.

 The Chancellor’s ring-fencing is too little, too late and makes no allowance for the fact that health service costs rise faster than inflation

Read more

Plan F – economic recovery for gender equality

tweet womens roomToday, the organisation I work for – the Women’s Budget Group released a briefing outlining how austerity in the UK is hitting women harder than men. Though there are signs of economic recovery they are not yet apparent in the lives of real women. The briefing outlines what is needed to make recovery benefit men and women – plan f.

The briefing was also covered by the Observer and was timed with the Labour Party Conference in Brighton where they were also discussing of the economy. I was delighted to be invited by Caroline Criado-Perez to guest tweet for the Women’s Room on this subject. The conversation was fascinating we covered free school meals (one of Ed Milliband’s announcements today), child care, unconditional basic income, investing in social housing and making social housing accessible, apprenticeships and much, much more.

Come join the conversation on Twitter using the hashtag #planf, look forward to hearing your thoughts.

CEDAW – what have budgets got to do with it?

First published on the Women’s Resource Centre Tumblr

cedawNext week the government comes under review by the UN to see whether they are complying with the catchily-named Convention for the Elimination of Discrimination Against Women (CEDAW).

The government must report to the committee about the steps they have made towards women’s equality in key areas such as health, employment, education, representation, social and economic benefits, sex role stereotyping, trafficking and marriage and family law.

Just three weeks prior to this, the Chancellor announced his spending review for 2015-16 detailing government spending cuts and increases in advance of the 2015 election. But how and why are CEDAW and the government’s economic policies connected?

How governments spend and raise money have different implications on women and men. When the some of the Women’s Budget Group, a network of over 200 academics and experts, met to discuss the Chancellor’s spending review, it was clear his announcement held significant disadvantages to women.

Though CEDAW makes no specific references to public expenditure, it does ask the government to take all appropriate measures to eliminate discrimination against and ‘ensure the full development and advancement of’ women (Articles 2, 3). They must achieve this not only through active government policy to improve gender equality but also to ensure that their policies don’t unintentionally discriminate against women.

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Bad news for most: The Chancellor’s spending review holds little hope for women

I was delighted to have this article posted on the TUC’s Touchstone blog on 02/07/2013.

Bad news for most: The Chancellor’s spending review holds little hope for women

Last week members of the Women’s Budget Group met to watch and discuss the Chancellor’s spending review for 2015 – 2016. Predictably it held few surprises: more cuts, more austerity and a few titbits to keep the voting public happy in advance of the 2015 election.

Of course there was some good news – the budget for the NHS remains safe from cuts and overseas development spending continues to be set at 0.7% of GDP. For every public sector job that has been lost, three private sector jobs have been created, and the Chancellor also announced a huge investment in physical infrastructure – roads, rail and nuclear power stations. Which has got to be good, right?

Well not quite.

The Chancellor’s ‘good news’ announcements cover up a multitude of sins. Again we see local authorities bearing the brunt of the cuts with their budgets being slashed by a further 10%. Local Governments provide essential services to women and women’s organisations. Successful programmes like Sure Start now have a future as uncertain as the children they support.

The Department for Culture, Media and Sport faces a cut of 7% but many of us balked when Osborne announced that ‘elite sport’ would be protected whilst many local sports clubs face cuts or even closure.  All of these reductions take place whilst the Chancellor has somehow found enough money to protect the defence budget.

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Turning back the clock on women: Northern Ireland and the recession

‘The model of society being held up for women is, “go back to the home, pick up the unpaid caring role that we, the governments, cannot cover and we will focus on incentivising your husband to support you”.’

(The Northern Ireland Economy: Women on the Edge, Women’s Resource and Development Agency 2011)

This is the message being sent by the government to the women of Northern Ireland according to a new 160 page report on women and the recession – The Northern Ireland Economy: Women on the edge? – a comprehensive analysis of the impact of the financial crisis on women.

It examines a range of issues including childcare, lone parents, older and younger women, migrant women, pensions, welfare reform, debt and housing.

The report, published at the beginning of July by the Women’s Resource and Development Agency and funded by the Office of the First Minster and Deputy First Minister,  provides evidence that women are being disproportionately impacted by the financial crisis and ensuing budget cuts.

The dry statistics of job losses and low wages are brought to life by quotations from interviews and focus groups held with a range of women across the region. One said, “my wages are not going anywhere. Diesel has gone up. I’ve had to use the tumble dryer in bad weather. The cost of nappies has gone up. And I’m expecting another child.”

Another said, “I go and stay with my mum 2/3 nights a week because I cannot afford to keep the heating on. The price of oil is terrible and I have to cut back until I get paid again.”

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