: I move amendment No. 12:
In page 8, subsection (1), to add to the Table as follows:—
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Finance Act, 1975:
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Section 11
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(housekeeper allowance)
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165
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600
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(employed person tak- ing care of incapaci- tated person)
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165
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600
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(blind person)
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165
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600
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Finance Act, 1977:
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Section 1 (dependent relative allowance)
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95
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300
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This amendment proposes to increase the housekeeper allowance, the allowance to an employed person taking care of an incapacitated person, the blind person allowance and the dependent relative allowance. The housekeeper allowance was introduced in 1949-1950 and originally was an allowance of £100 against tax. It is now £165. There has been an increase of only 65 per cent in that allowance since it was introduced in 1949—a long time ago.
The increase to £600 which I am now proposing for that allowance would more or less reflect the rate of inflation since 1949-50 when it was introduced. One can see how unfairly the housekeeper allowance category have been treated by comparison with married people who have no problem of this sort and do not have to get a housekeeper in. The married person's allowance since 1961 has increased by 339 per cent whereas the housekeeper allowance since 1949-50 has increased by only 65 per cent, a much smaller increase over a much longer period.
The housekeeper allowance basically is granted in respect of a resident female relative or, if no relative is available, a female employee taking charge of a widower, widow, married man living apart from his wife or a separated wife or as of 1971-72 a a single woman in full time employment or business or, alternatively, a resident female relative taking charge of a brother or sister of an unmarried person. The type of person who would avail of the housekeeper allowance is probably somebody who, if he did not go out to work and take in a housekeeper would either not work at all and have to be supported entirely by social welfare benefits or, if he continued working, the children or the old person or whoever the housekeeper was being employed to look after would have to be committed to an institution and cared for entirely at the expense of the Exchequer. In both cases the failure of the person to adopt the course which allows him to claim the housekeeper allowance would involve a much increased burden on the Exchequer either in terms of social welfare or institution costs if the children or other people being looked after by the housekeeper had to be sent to an institution. Yet the tax allowance for such persons going out to work has been increased by only 65 per cent since 1949-50.
Since 1969-70 there is an allowance for an employed person taking care of an incapacitated individual which is claimable if the taxpayer or his wife is totally incapacitated throughout the year of assessment and employs a person to take care of himself or his wife. That was introduced at £100 in 1969-70 and increased in 1975-76 to £165, a 65 per cent increase over a much shorter period. Basically, I would argue that that allowance is only an extension of the housekeeper allowance and the fact that the housekeeper allowance has not been increased by more than 65 per cent since 1949-50 is the basic point that requires to be made.
The amendment also seeks to increase the blind person's allowance which was introduced in 1971-72. It was increased by 65 per cent in 1975-76 and has not been increased since. That is not in existence as long as the housekeeper allowance and my argument is much stronger in the case of the housekeeper than in the case of the other two. Perhaps the Minister could give me a separate estimate of the cost of giving the increase I suggest in the housekeeper allowance to the employed person to take care of the incapacitated person and the blind person's allowance. The case is stronger for the housekeeper allowance and if the Minister cannot accept the entire amendment he might accept an amendment to increase the housekeeper allowance only. I should be glad to get some figures in regard to this matter.
The other increase proposed is in the dependent relative allowance introduced in 1956-57 at £60. In 1977-78 it stood at £95, an increase of 58 per cent. As I have pointed out other allowance have increased by much more than 58 per cent since 1956-57. The married allowance has increased since 1961 by 339 per cent while this allowance over a longer period has increased by only 58 per cent. Again, this seems not to be keeping pace with inflation for a minority group with dependent relatives. This allowance is granted for each relative incapacitated by old age or infirmity or for a widowed mother or mother-in-law if maintained by the claimant and for a son or daughter resident with and maintained by the claimant whose services the claimant is compelled to depend on because of his own old age or infirmity.
Again, the type of person who would apply for this allowance would be the person who if he did not put himself in a position to do this, the cost to the Exchequer of his not doing so would be far greater than the cost of his availing of this minimal allowance. If, instead of keeping an incapacitated old relative at home he were to request that the relative be admitted to the county home the cost to the Exchequer would be far greater than the cost of granting this allowance. Equally, in the case of the tax-payer himself being incapacitated, if he were not to stay at home but were to seek admission to the county home, although I presume a substantial part of his income would be used by the county home to maintain him while there, assuming he had an income, there would be significant additional cost to the Exchequer, I think, in his going to the county home over and above the very small cost of the £95 granted if he has to have a son or daughter resident and maintained by him and on whose services he is compelled to depend because of his own old age or infirmity. When one considers the situation of such a person and the son or daughter who has to live with him and look after him, we realise that that son or daughter—I think we all know of such cases in our constituencies—if not staying at home to look after the claimant who has the income on which to claim, could be out earning perhaps £2,000 or £3,000 a year, a very large sum compared with the allowance of £95 against the tax of the person they are looking after. Instead, in a spirit of self-sacrifice and loyalty to their own family they decide not to work but to stay at home and look after the incapacitated parent.
All that the tax code can offer them in terms of a concession on their parents' income, if the parent is maintaining them or paying them something so that they can be free to look after them, is a meagre tax allowance of £95. It is not the right sort of priority and I would have preferred to see these sort of allowances getting the attention.
I realise that the Minister has a problem if he is, as he was in the manifesto, trying to get as many votes as possible. Obviously there are a lot more married and single people interested in their own tax-free allowances than there are dependent relatives and so on and they have many more votes than the minority who are in a position to claim the widow's allowance, the dependent relative allowance, the housekeeper allowance and so on. If the Minister had said in the election manifesto that there would only be a small increase in the married allowance but that there would be big increases in the other allowances mentioned here, I suppose the number of votes he would get might not be as many, because the number of people who would benefit might not be as great, and from an electoral point of view the results would not be all that the Minister would wish. That is the reality of the political situation. It is not a question of blaming the Minister or anybody else.
We are talking here in this amendment about a small minority but the fact that they are a minority that have been neglected is clearly borne out by the percentages I quoted. The married person's allowance increased by 339 per cent since 1961 alone, whereas the housekeeper allowance has only increased by 65 per cent since 1949 and the dependent relative allowance by only 58 per cent since 1956-1957. All parties see much more attraction in making an appeal to the big battalions of voters who are in the married person or single person category, and there is no electoral incentive to give concessions to the people I have mentioned. Their need is obviously far greater. They are doing something which is socially beneficial by maintaining a relative at home or by keeping a family without recourse to the State by going out to work. It is not because there is no need but because these people are not an organised group and do not have an equivalent impact on the political process as do the other groups I have mentioned. They are not either well-heeled or articulate.
I realise that the Minister has made his decision for this year in relation to the distribution of the tax allowances. I hope the Minister can indicate that he will do something about the failure to increase the housekeeper allowance. Even if that is not possible, I hope the Minister will give an indication that he will give favourable consideration between now and the next Finance Bill to the points I have made. The neglect of these categories is something which all of us ought to be ashamed of. I hope the Minister will see his way if not to do something about these allowances this year to do something about them next year.