David Cameron accused of penalising parents with tax plans

David Cameron was yesterday accused of penalising parents who most need help with his planned tax breaks for married couples.

The Tory leader wants to encourage marriage by skewing the tax system in favour of couples who have wed.

But one in three children are raised by a lone parent or a mum and dad who are not married. And they will suffer.

Fiona Weir, chief executive of Gingerbread, said those 4.5 million children include some of the most needy.

She said: "We don't think that a married tax allowance would be the most effective way of getting money to the families on the lowest incomes who need it most.

"Millions of families are struggling to stay afloat financially. In the current recession it is all the more important that scarce public funds are directed to families on the basis of need."

Mr Cameron has admitted his government would skew the tax system in favour of married couples.

He said: "A society that values marriage is a good and strong society. That's why we will recognise marriage in the tax system."

Mr Cameron is due to speak to Gingerbread next week. The Tories fear he will face a "Women's Institute moment" - a reference to the way Tony Blair was humiliated in 2000 when disgruntled WI members gave him a slow handclap.

The Tory leader has not spelled out precisely how the tax incentives will work.

But last week The Mirror revealed that the only firm proposal - a plan to let married couples share their individual tax-free allowances - would benefit the wealthiest far more than the poorest.

It would let wives who do not need to work pass their tax-free allowance on to their already-wealthy husbands. The scheme would leave poorly-paid households £30 a year better off - while the richest would benefit by £380.

Labour yesterday said Mr Cameron's plans were "outdated nonsense". Children's Secretary Ed Balls said: "The idea that the four-and-a-half million children in families without two married parents should be treated as second class is plain wrong.

"That's what David Cameron's Conservatives are saying. There would be extra tax help if you're married.

"But if you're separated, widowed or divorced or you're co-habiting with a partner there'll be no help for you at all.

"The most important thing for children is strong, stable relationships where adults respect each other. These days families come in all shapes and sizes. The Tories are out of date and out of touch."

Treasury Secretary Liam Byrne said: "After four years, David Cameron still won't say how he'll support marriage in the tax system. The only proposal he has endorsed costs £4.9billion and gives 13 times as much benefit to the highest earners as to people on lower incomes." Mr Cameron has said he did not believe voters who are not married would be put off by his pledge.

He said: "People all make their own choices in life. I think, as a society, saying that marriage is a good thing and celebrating it and encouraging it, including through the tax system, is something that most societies do in Europe."

The Tories' scheme to give an inheritance tax break to the super-rich while planning a pay freeze for public sector workers has already stirred up a hornet's nest.

Polls show support for the Tories slipping. A poll for the Independent yesterday had the Tories on 37%, down three points, Labour unchanged on 27% and the Lib Dems up two points at 20%.

In 10 polls in November, seven had the Tories below the 40% figure they need for an overall majority. In October, in 16 polls they did not slip below 40%.

TAX BID TOO RIGHT-WING FOR THATCHER

David Cameron's plan for a tax break for married couples was once rejected as being too right-wing by Margaret Thatcher.

She realised allowing wives who did not work to pass their tax-free income allowance to their husbands aided the rich, but not couples who were both working.

According to ex-head of the policy unit Ferdinand Mount, former Chancellor Geoffrey Howe proposed the plan, but Mrs Thatcher said: "I simply can't accept it. I can't let the mill girls of Bolton down."

She said: "There are these girls getting up at dawn and working all the hours God gives, and then they see these women in the Home Counties playing bridge and getting exactly the same tax allowance."

Cameron's Business Secretary Ken Clarke also voiced concern this year saying: "This is social engineering for God's sake."