“The most important thing we do as a nation is raise the next generation.” – John Howard
I’m always fascinated when former Prime Minister John Howard intervenes in public policy debates.
The 78-year-old’s wisdom is worth hearing.
His last intervention was during the marriage plebiscite when he and his former deputy John Anderson called out the Turnbull Government for failing to protect freedom of speech and freedom of religion.
It beggars belief that a “conservative” government could neglect freedoms and then allow its members to vote against amendments to protect them, but I digress.
Mr Howard’s latest foray https://www.theaustralian.com.au/national-affairs/treasury/save-family-tax-breaks-says-john-howard/news-story/32548e7f1837466199ab0e77f20262d3 is to again remind a “conservative” government of the basics.
Yesterday he “blasted” (The Australian’s word) claims that family tax benefits were middle class welfare.
This “pejorative slogan” had eaten away at the family tax payment system to help families, particularly single income families.
Now as a young dad in the early 2000s, I was always uncomfortable about the taxpayer largess that came my way the more children we had.
It certainly helped our family budget as my wife chose (often against my urging of her to consider an earlier return to the workforce) to care for our pre-school children at home.
I wished instead of having money from the government deposited into our bank account, that we had been able to income split.
Why have the government take money away in tax, churn it through the bureaucracy and then give it back?
Apart from the obvious waste, it creates a false impression of dependency on government when in reality it is churning what is our money in the first place.
It is my understanding that in those early years of the Howard Government income-splitting for single income households was the preferred method favoured by many of the elected people.
But the bureaucrats, who like to be in control, won out and we got Family Tax A and B.
Because the money was being “given” to households a big straw man called “middle class welfare” was set up and it has been attacked relentlessly ever since.
A recent advocate for family income splitting was Senator Matt Canavan, before he was promoted to cabinet and the gag on innovative policy ideas kicked in.
Canavan pointed out that Australia has “one of the most hostile tax systems in the world for single income families”.
A single income family earning $120,000 per year pays approximately $10,000 more tax than a dual income family on $120,000.
This is because the dual income family has access to not one but two tax-free thresholds.
“This situation violates the key tax principle of horizontal equity,” Canavan says.
“People with similar ways and means should pay similar amounts of tax.”
I can only assume that after months in Cabinet, the government is not interested.
As Mr Howard says, the most important thing a society does is raise the next generation.
While child care is magnificent, there are many people, like my wife, who would prefer to work in the home and care for their own children rather than put them in childcare.
I’m forever thankful to Wendy, who later returned to her career, for doing this. It gave our kids a great start and allowed her to share once-in-a-life-time precious time with them while they were very young.
The tax system should respect this choice but it doesn’t.
Massive childcare subsidies are available to pay for the ever increasing costs of childcare but little is offered to the mum or dad who chooses to stay at home with young children.
On Sky this week Bronwyn Bishop said childcare subsidies should also be paid to parents caring for their children at home as it is more efficient than having government money go to the institutional costs of the childcare centre, such as electricity and building maintenance.
As his attempt to help government policy prioritise the next generation unravels under a “conservative” government, it is no wonder Mr Howard is “blasting” the current sad state of affairs.
Since the 1970s, conservative parliamentarians like Mr Howard have had to battle the headwinds of political correctness when seeking to prioritise the basic group unit of society – mum, dad and the kids – in public policy.
We rightly support single parent families but with financial pressure a major contributor to marriage breakdown, family income-splitting is the least government can do to help us as a society put family first.