§ Mr. Michael Shaw (Scarborough and Whitby)
I beg to move Amendment No. 27, in page 15, line 20, at end insert:(9) In section 214 of the Income Tax Act, 1952 after 'he has employed some other female person for the purpose' there shall be inserted 'whether or not she is resident with him'.Section 214 deals with an allowance given in certain circumstances in respect of a person taking charge of a widower's or widow's children, or acting as his or her housekeeper. The term "housekeeper's allowance" has become well known, and is used not only in this Section but elsewhere.
I concede that in wording my Amendment as I have I have dealt with a point that only partially covers the question of housekeeper's allowance. I have done so deliberately, because I am dealing only with the allowance relating to a housekeeper employed by the taxpayer, and not with the case where a female relative is acting as housekeeper. However, I believe that if my argument is accepted the case of others acting as housekeepers will be accepted as well, because the arguments are very similar.
On the whole, however, the point I have selected is the most appealing. Where a claimant proves that he is a widower, and that during any year of assessment he has a female relative living with him to take charge of any children, or to act as housekeeper, he shall receive an allowance. If he has no female relative who can live with him to act as housekeeper, he can employ a female person to act as housekeeper.
For many years there was doubt as to whether someone employed as housekeeper had to live with him if he was to receive the allowance. That doubt was cleared up in 1964, when the Court of Appeal held that any person employed 770 in the capacity of housekeeper had also to be resident with the taxpayer if he was to claim the allowance.
The allowance was created many years ago. The first relief was given in respect of relatives resident with the taxpayer to look after children. The housekeeper's allowance to look after the children was first given as long ago as 1920. For acting purely as a housekeeper to the widower or widow, the allowance was first given in 1924. These allowances are long-standing. Since those early days conditions under which people live have changed greatly. In those days it was common to have people living in one's home, looking after children or acting as housekeeper. Now it is not. Not only is it not customary to have people living in to assist with the housekeeping, but it is all the more difficult for anyone to obtain the services of such people if it is insisted that they live in.
Customs have changed. People more readily come to act as a housekeeper if they can go back to their own home at night. Many who are in need of this sort of help find it difficult enough to get any sort of help. The pattern of living for the taxpayer has changed in that the taxpayer may be living in a house in circumstances where it would not be convenient for him to have another person living under the same roof permanently.
The need for these allowances is as great as it has ever been, and because of the changed circumstances in which taxpayers live there is a great need to change the definition under which the allowance is granted. I am seeking to bring the definition of "housekeeper" up to date. The changing pattern of society fully justifies granting the allowance in accordance with today's conditions.
§ Mr. Richard Wainwright (Colne Valley)
I am happy to support this Amendment because the insistence on residence is no particular virtue. There is no entitlement to tax relief simply because a person has someone resident in his house. This must only have been inserted in the legislation out of an abundance of caution in earlier days aimed at assisting the Revenue in policing the administration of this Measure.
Insistence on residence has now become an intolerable burden for many 771 good reasons adduced by the hon. Member for Scarborough and Whitby (Mr. Michael Shaw), and for several others too. When the allowance was first introduced the use of a telephone by such people was relatively uncommon. Now it is a familiar arrangement, having regard to the difficulty of getting housekeepers to be wholly resident, for the employer to have a telephone. In this way the housekeeper can live out, returning at night to her home—which she wants to keep on, because otherwise her employer may die and leave her homeless—and keep in touch by telephone during the night for emergencies. This arrangement was not possible when the original legislation was drafted. Because these words are in the Statute only as a policing measure and not because of any inherent virtue in them, the time when they were valid is past and insistence on retaining them causes great unfairness and distress to particularly deserving people.
§ 11.30 p.m.
§ Mr. Tom Boardman (Leicester, South-West)
I support the Amendment. The requirement about residence was not in the Statute. It sprang from a decision in 1937 which was reaffirmed in 1964.
One wonders whether it was ever the intention of the House that residence should be a requirement. In my constituency there are a large number of women who go out to work. The position is particularly hard for widows left with small children who wish to go out to work but find that the burdens of taxation make the decision a borderline one. They are often able to get neighbours to look after the children and to pay them. It is eminently reasonable that they should be allowed the relief of the housekeeper allowance for bringing in someone to look after the children while they go out to work. It is good for the widow, for the neighbours and for the economy.
This is an eminently sensible and reasonable Amendment which I hope will be accepted.
Mr. Donald Wiliams (Dudley)
I support the Amendment. The problem with the Revenue has been for many years that a person in this capacity would attract a dual allowance—that is, the 772 allowance as a wife and the allowance as a housekeeper. The Revenue has fought against this particular form of allowance.
The Minister has indicated that on the question of interest he over-rode his logic with common sense. Common sense would be brought into the law relating to the allowance for housekeepers if the Government accepted the Amendment. Two allowances are given when a married woman is working. Why cannot the Government give a special allowance for housekeepers?
A case in point was brought to my notice. A man's wife died and he was left with four children. He could get someone to look after them only during the day. He was not granted a housekeeper allowance. I hope that the Chief Secretary will accept the Amendment.
§ The Chief Secretary to the Treasury (Mr. John Diamond)
I hope that I can meet the arguments and cases described, but I must make it clear that I cannot accept the Amendment.
Hon. Members have had in mind the case of the young child. When the housekeeper allowance was first devised—and the recent court case has merely removed doubt and reaffirmed the practice which has obtained throughout—what was envisaged was someone taking the place of a deceased wife in looking after young children. Therefore, after the children's mother died, the person who was helping would naturally live in to look after the children. Residence, therefore, was part of the conditions of the allowance.
We have moved on very considerably since then. That allowance remains at £75, but an additional personal allowance has largely taken its place, though not entirely. That further allowance, which meets the point made by every hon. Member so far in this debate, has been raised by my right hon. Friend in this very year to £100. It is available to a widow or widower with a young child, but it does not require that a housekeeper shall be employed, or that the housekeeper shall be resident, or even that there shall be a housekeeper. If a person has the use of some friend or relative to help, this allowance of £100 will be available.
The only purpose which the old housekeeper allowance still serves is a limited purpose, and one which has got some 773 distance from the original purpose. The purpose is not that of looking after children, not where a child is involved, but where there is a widow or widower. In this limited number of cases where there is a widow or a widower, and therefore nothing like the same need of help, an allowance of £75 is available only where the housekeeper employed is resident.
I hope that what I have said about the first allowance meets the real point that hon. Members had in mind. It is, in short, an allowance not of £75 but of £100 to a widow or widower and totally irrespective of whether the housekeeper is living in or is living in her own home and at the end of a telephone. That is the new situation as a result of the increase provided for in this year's Budget.
On the other allowance, I would not be able to recommend to the House that we should remove the restriction on living in, of residence there, because that would quite simply mean that in time we would inevitably be driven to give an allowance for everyone who employed outside domestic help. That is just what it would come to—to every widow or widower, and it would soon move even wider than that, who employed outside domestic help. It would be enormously expensive, and not based on need at all. It is for the individual to decide how to spend his money, and whether to spend it on outside help or not is an individual decision. I hope I have explained that the case that has been put is met not only as to £75 but as to £100, but I cannot recommend acceptance of the Amendment to the House.
§ Mr. Eldon Griffiths
The Chief Secretary's reply is disappointing, and I want to put two very narrow points to him.
If the concession is confined to housekeepers who remain overnight, the right hon. Gentleman is saying, in effect, that it is available only to those who have a room available where the housekeeper can live. I understand that the policy of both major parties towards the elderly is to encourage them to live in smaller homes; that is to say, to move out of what are in many cases council houses with two or three bedrooms into, in some areas, small specialised old people's homes. In almost every case there is no spare bedroom there, and cannot be. It would be wrong for the nation to 774 provide a spare bedroom. It is then not possible for a housekeeper to be resident. She cannot stay overnight, because there is no room for her, and in the circumstances described by my hon. Friend the person concerned is automatically excluded from benefiting from the concession. That cannot be just.
The other point is equally narrow but equally important. The concession will be available only to those who employ housekeepers to be resident overnight. Many women are glad to work as housekeepers and are badly needed by the elderly, who will not be able to meet the terms described by the Chief Secretary. Those housekeepers cannot be away at night because their husbands and children need them at home. Automatically that group of people, who are perfectly willing to be housekeepers, cannot do this work because of the terms of the legislation.
In the whole of our social policy with more and more elderly people living alone, it must be desirable to encourage people to work for them, at their own expense and encouraged by tax allowances rather than elderly people having to lean on the home help service or other services provided by the taxpayer. We should encourage people to rely more on their own hiring of help.
§ Mr. Michael Shaw
I echo the view of my hon. Friend the Member for Bury St. Edmunds (Mr. Eldon Griffiths) that the reply by the Chief Secretary was disappointing. I am grateful to my hon. Friends for their support for the Amendment.
With his usual skill, the Chief Secretary divided the case and sought to demolish it on the weaker grounds put forward. I accept that as far as concerns children that was the weaker ground, but acting as a housekeeper is the stronger case which I emphasised. The Chief Secretary said that if he were to grant the concession or extend the allowance by removing the need for residence that would open the whole case for an allowance for domestic help of all kinds. That danger has existed not only recently but since 1924 when the housekeeper allowance was introduced. Even in those days it was asked in what capacity was the domestic help used in the home. One had to satisfy the Inland Revenue that it was in the capacity of a housekeeper. That 775 test would still have to be applied whether the housekeeper were resident or not.
Changes which have come over the social scene in these many years since the original legislation was passed mean that it is natural in normal circumstances for the housekeeper to live outside rather than in the taxpayer's home. That is the whole criterion for this Amendment.
§ Amendment negatived.
§ Dame Irene Ward
On a point of order. Mr. Deputy Speaker. When you put the Question a second time hon. Members on this side of the House said "Aye". Did you not hear them?
Mr. Deputy Speaker
I put the Question and collected the voices and determined that the Noes had it, so the Noes have it.
§ Dame Irene Ward
Further to that point of order. Hon. Members on this side said "Aye", so you could not have collected the voices.
Mr. Deputy Speaker
It is for the Chair to decide when the voices have been collected. I have collected the voices on this issue and decided that the Noes have it.